Reddit $RDDT stock dropped 9% on Wednesday after the Wall Street Journal reported the company had internally discussed ending Google $GOOGL's ability to access its content for AI training purposes.
Reddit's $60 million-a-year deal with Google is ending soon, and the company is reassessing whether renewing it makes sense
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Reddit $RDDT stock dropped 9% on Wednesday after the Wall Street Journal reported the company had internally discussed ending Google $GOOGL's ability to access its content for AI training purposes.
Reddit and Google struck a $60 million-a-year deal in 2024 allowing Google to train its AI models on Reddit's content, according to CNBC. That agreement is ending soon, and the two companies are in talks about potentially renewing it. With Google's AI-powered query responses cutting into traffic to third-party sites, Reddit's leadership is questioning whether the arrangement still serves the company's interests, the Journal reported, citing people familiar with the matter.
Reddit is not alone. USA Today, Politico, the Economist, People Inc. and Reuters are all weighing how, or even if, they will continue working with Google. USA Today's flagship national outlet saw its organic Google search traffic from U.S. readers decline by close to 50% in the twelve months ending June 2026, per Semrush data. Over that same twelve-month stretch, Politico saw its Google search traffic decline 23%, CNN's fell roughly 25%, and Business Insider experienced a loss of more than 85%.
"This is existential for some categories of publishers," David Buttle, CEO of media consulting firm DJB Strategies, said.
In response, Google said its AI search tools direct substantial traffic across the web and, in a statement to the Journal, said those features support audience growth for publishers and content creators.
Reddit also has a data licensing partnership with OpenAI that allows the ChatGPT maker to train its models on Reddit's content. Reddit CEO Steve Huffman addressed both relationships on a recent earnings call. "We have important partnerships with both Google and OpenAI," Huffman said. "Those are very meaningful to us, and I think it's mutual. We continue to value those."
Reddit reported first-quarter revenue of $663 million, a 69% jump from a year earlier, with advertising driving the bulk of that growth. Data licensing, which includes the Google and OpenAI partnerships, generated $39 million in the quarter. Reddit is scheduled to report second-quarter earnings on July 30.
Reddit's share price has fallen approximately 27% since the start of the year.
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