Reddit sinks 9% on report it may cut off Google's AI data access

Published Jul 22, 04:41 PM UTC

Reddit shares fell 9% to $169.48 following a Wall Street Journal report that the company may block Google from using its content to train AI models. The two sides are negotiating a renewal of their 2024 data-licensing agreement, estimated at $60 million per year, but talks have stalled over traffic cannibalization concerns. Google's AI Overviews answer queries directly on search pages, reducing referral clicks that Reddit relies on for ad revenue. Reddit executives reportedly want usage-based fees. The stock is down 26% year-to-date, though Q1 revenue surged 69%. Analysts maintain a $227 price target. Other publishers like USA Today and Reuters are also reassessing Google relationships. Alphabet shares were little changed. Insider COO Jennifer Wong sold stock under a pre-arranged plan.