Reddit CEO Claims Chatbots Fail to Boost Traffic

Bassyonni

ago 8 hours

Reddit CEO Claims Chatbots Fail to Boost Traffic

During a recent earnings call, Reddit CEO Steve Huffman emphasized that AI chatbots do not significantly contribute to traffic on the platform. Despite advances by companies like OpenAI and Google in using AI for search, Huffman stated that traditional methods remain dominant.

Traffic Sources for Reddit

Huffman pointed out that Google search and direct traffic are Reddit’s primary sources. In response to an analyst’s query, he confirmed that about 50% of the platform’s traffic comes from each of these channels, describing the figures as “approximate, but pretty close.”

AI Chatbots and Data Relationships

While Reddit has engaged in partnerships with significant AI companies, including OpenAI and Google, Huffman noted a complex relationship with AI firms. In May 2024, the company implemented a new policy limiting data access for commercial use. Nevertheless, Reddit reached an agreement with OpenAI to allow the use of its data for training models.

Legal Challenges

Reddit has also been involved in legal disputes with AI developers such as Anthropic and Perplexity over the use of its data.

Financial Performance and User Engagement

In the latest quarter, Reddit reported impressive revenues of $585 million, reflecting a 68% year-on-year increase. Key user statistics also showed growth, with 116 million daily active unique users and 444 million weekly unique users, marking a 20% year-over-year rise.

31% year-on-year growth in international daily users.
Over 190 million Americans visit Reddit weekly.
75 million users perform searches on Reddit weekly.

Huffman discussed ongoing investments in enhancing the search experience on the platform, indicating that AI-powered features account for 20% of search volumes. A unified approach to integrating AI with core search functions is anticipated in the coming quarters.

Improving User Experience

To bolster early user engagement, Reddit is piloting a simplified onboarding process. Huffman expressed a commitment to ensure that new users quickly realize the platform’s value, stating, “We want them to see in their first session that Reddit is amazing and has content for them.”