Reddit is considering ending its $60 million-a-year AI content deal with Google, causing its stock to drop 9%. The potential move comes as Google's AI-powered search summaries reduce referral traffic to publishers, with some sites like Business Insider seeing drops of over 85%. While Reddit also has a deal with OpenAI, the conflict highlights growing tensions between content creators and AI firms over data use and traffic.
Reddit-Google AI content deal
- ▪Reddit's data licensing deal with Google, valued at $60 million per year, was established in 2024 and is nearing its end
- ▪Reddit has discussed shutting off Google's access to its content, which is used for training AI models like Gemini
- ▪Reddit and Google are in talks about potentially renewing their partnership
Google AI traffic impact
- ▪Reddit is reconsidering its deal with Google because the search giant's AI summaries are reducing referral traffic to external websites
- ▪Between June 2025 and June 2026, Google referral traffic reportedly fell for several publishers, including Politico (23%), CNN (25%), and Business Insider (over 85%)
- ▪Google stated that its AI features, including AI Overviews, help creators and publishers grow their audiences by sending traffic to a diverse range of sites
Media company legal responses
- ▪Education technology company Chegg sued Google in 2025, alleging that the search engine's AI summaries negatively impacted its traffic and revenue
- ▪Some media companies are taking legal action against AI firms to protect their intellectual property as their websites experience lower search traffic
Reddit data licensing business
- ▪Reddit CEO Steve Huffman described the company's partnerships with both Google and OpenAI as "very meaningful" and "mutual."
- ▪Reddit's data licensing business, which includes a similar content deal with OpenAI, helped the company beat earnings expectations in Q1 2026
Reddit financial performance
- ▪In the first quarter of 2026, Reddit's revenue increased by 69% year-over-year, surpassing analysts' expectations
- ▪On July 22, 2026, Reddit's shares slid 9% following a report that it might not renew its content deal with Google
- ▪As of July 22, 2026, Reddit's stock was down approximately 27% year-to-date
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