Reddit Q2 Earnings Beat Expectations, but AI Impact on Search Traffic Triggers Sharp Stock Price Decline

According to TechCrunch, Reddit announced its Q2 2026 financial results, with total revenue of $805 million, up 61% year-over-year; net income of $253 million, up 183% year-over-year, both exceeding Wall Street expectations, and Q3 revenue guidance was also higher than expected. However, CEO Steve Huffman warned in a letter to shareholders that referral traffic from search engines fluctuated significantly this quarter; coupled with market concerns regarding the substitution effect of AI search, Reddit's after-hours stock price plummeted by over 10%. Data shows that Reddit's U.S. daily active users declined slightly quarter-over-quarter, dropping from 53.5 million in Q1 to 53.2 million. Additionally, there is uncertainty regarding whether the AI training data licensing contract between Reddit and Google can be renewed; Huffman stated he would ensure "maximizing Reddit's value", but did not provide a clear answer.