PomegraReddit Stock Plunges 29% After Weak Q4 Guidance
Why did Reddit stock plunge 29%?
Reddit (RDDT) stock fell 29.2% on Friday to $91.73 after weak fourth-quarter revenue guidance, as the company said Google's AI search is cutting traffic and it will test requiring logins.
Key numbers
| Reddit share price (Oct 30 close) | $91.73-29.2% in one day |
|---|---|
| Q3 2026 revenue | $895M+53% YoY |
| Q4 2026 revenue guidance | $1.00B–$1.03Bvs $1.05B expected |
| Daily users (Q3) | 130.3M+12% YoY; US -2% |
| Stock performance year to date | about -60%(per [2]) |
What happened
Reddit (RDDT) stock fell 29.2% on Friday to $91.73 after weak fourth-quarter revenue guidance, as the company said Google's AI search is cutting traffic and it will test requiring logins. Sales still grew 53% from a year earlier to $895 million, beating forecasts. But Reddit's own forecast (guidance) for the next quarter is $1.0 billion to $1.03 billion, below the $1.05 billion Wall Street expected. It also said daily users could fall by a low double-digit percentage from 130 million, as visits from Google search are "down meaningfully".
Why it matters
Reddit's plunge shows how Google's AI-written search answers can cut visits to websites that depend on search traffic. Reddit earns its money from ads, so fewer visitors can mean less revenue. Requiring logins could turn more visitors into account holders, which helps ads, but it may also push some people away. Logged-in and app users already account for over 80% of the money Reddit earns from users.
Who this affects
- MarketbearishMedium impact
- Roblox and Pinterest also fell; bad for holders of internet stocks.
- CompanybearishHigh impact
- Shareholders lost about 29% in one day, its worst ever.
- CompetitorsbearishLow impact
- Pinterest and Roblox also fell, though for different reasons.
- IndustrybearishMedium impact
- Websites relying on Google traffic face pressure from AI search.
Reddit vs Pinterest, Roblox
How we got here
Reddit reports Q3 revenue of $895M, up 53%, and guides Q4 to $1.0B–$1.03B.
CEO Steve Huffman says Reddit will test requiring logins, starting outside the US in Q4.
Shares close down 29.2% at $91.73, Reddit's worst day since its 2024 IPO.
What to watch
- Reddit's login-requirement tests in markets outside the US and their effect on usersQ4 2026
- Whether Reddit's daily users fall as warned and how Google search traffic trendsQ4 2026
- Reddit's fourth-quarter results versus its $1.0B–$1.03B revenue guidanceQ1 2027
Educational content only. Not investment advice.
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