Reddit to move most of its site behind logins as search traffic drops

Reddit told investors on Thursday that it plans to move most of its site to a primarily logged-in experience, a shift meant to keep posts and comments out of reach of AI companies that scrape the open web to train their models. The company announced the change during its third-quarter earnings call, saying it would let Reddit control who can read its content and push more companies toward paid licensing deals instead of free scraping.

Reddit said the move follows a sharp drop in traffic from search engines as AI-generated answers replace traditional search results. Search referrals fell by more than 1 million per week on average in October, the company said. If that trend continues, Reddit warned, its daily active users could fall by a low-double-digit percentage next quarter, down from the 130.3 million global daily active users reported for the third quarter, a figure flat compared with the prior quarter. In the U.S., Reddit’s largest market, daily active users dropped from 53.2 million in the second quarter to 50.7 million in the third, a 2% decline from a year earlier.

Despite the user losses, Reddit’s business kept growing. Revenue rose 53% year-over-year to $895 million, beating Wall Street estimates of about $875 million, and net income climbed 74% to $283 million. Advertising revenue grew 54% to $847 million, while revenue from other sources, including AI data-licensing deals, grew 35% to $48 million. U.S. revenue per daily active user rose 53% to $13.82, and the global figure rose 36% to $6.87. Reddit says logged-in users are worth more to advertisers because they provide more data about their interests, which helps target ads and build personalized feeds.

How the rollout will work

Reddit said the change will not happen overnight. It plans to test the logged-in approach first in select markets outside the United States during the fourth quarter, and it has not set a timeline for a worldwide rollout. The company said a logged-out front page will still be available, and that logging in will not require giving up anonymity. Reddit’s “incognito mode,” which allows anonymous browsing, is being rebuilt rather than removed.

Reddit co-founder and CEO Steve Huffman addressed the change in a post on the platform. “I don’t know about you, but as someone whose life has been defined by the open internet, it’s a big change for me,” he wrote, adding that he had concluded it was “the right decision for our platform and the right decision for our business.” He also acknowledged open questions, writing that “there are still plenty of questions that are unanswered, particularly around where the boundaries should be between logged-in and logged-out experiences.”

Reddit has not said which countries will see the first tests or when U.S. users might be affected. The next earnings report will show whether the predicted drop in daily active users happens, and whether the shift toward logged-in browsing offsets the continued decline in search-driven traffic.