Reddit shares slid 18% in after‑hours, closing at $21.33 versus $26.20 pre‑market.
The company posted Q3 revenue of $895 million, up 9% YoY but still shy of the $1.12 billion consensus. Net income was $109 million, a 12.2% margin, up from $83 million and 10.8% in Q2, according to the filing filed with the SEC.
Global daily active users rose 12% year‑over‑year to 130.3 million, falling short of the 133.5 million analysts had modeled. U.S. daily active users slipped 2% to 70.4 million, underscoring the traffic risk that the new access policy aims to address.
CEO Steve Huffman announced a plan to limit non‑logged‑in access, saying the move mirrors industry norms and could boost conversion. The company will test phased roll‑outs in international markets over Q4, per the earnings call transcript.
The shift arrives amid a wave of tech earnings disappointments: Nasdaq tumbled 0.7% on Thursday, while competitors such as Snap and Pinterest reported lower revenue per user. Investors are watching whether Reddit’s monetization model can offset the traffic dip.
CFO Jen Wong told Bloomberg that the access restriction could trim short‑term traffic but improve long‑term monetization. Reddit will provide 2027 guidance next quarter, and analysts will gauge the impact on user growth, advertiser revenue, and shareholder value.