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

David Moadel Wed, July 22, 2026 at 9:41 AM PDT | 4 min read

Tickers: RDDT | GOOG | NVDA | META | GOOGL

Quick Read

• Reddit may block Google from training AI on its content as negotiations for a $60 million annual data deal stall over traffic cannibalization concerns.
• RDDT stock has shed 26% year to date, but Reddit's Q1 revenue surged 69%, and analysts price the stock at $227, well above today's levels.
• Act now: The analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Google didn't make the cut. Grab the names FREE today.

Shares of Reddit (NYSE: RDDT) are down 9% to $169.48 in Wednesday afternoon trading following a Wall Street Journal report that the company is weighing whether to cut off Alphabet's (NASDAQ: GOOGL) Google from using Reddit content to train artificial intelligence models.

The move leaves Reddit stock 26% lower year to date (YTD) and extends a rough stretch that included a 15% pullback over the past week. Reddit's market capitalization sits near $32.3 billion.

WSJ Report on Google Renewal Sparks Selling

According to the Wall Street Journal, Reddit is considering whether to block Google's access to its content as the two sides negotiate a renewal of their 2024 data-licensing agreement, estimated at about $60 million per year. No final decision has been made.

The core issue is traffic cannibalization. Google's AI Overviews answer user queries directly on the search page, reducing the referral clicks Reddit relies on to sell ads. Reddit executives reportedly want usage-based fees on the next deal.

The bullish read: Reddit's human-conversation data is among the most-cited sources feeding AI answers, and the company also licenses data to OpenAI, giving it real pricing leverage in a renewal.

The bearish take: If AI Overviews keep siphoning clicks, other publishers — including USA Today, Politico, Reuters, The Economist, and People Inc. — are also reassessing their Google relationships, and Reddit's ad engine could weaken over time.

Peers, the ETF Wrapper, and Insider Noise

The read-through to social-media advertising rivals is muted so far:

• Meta Platforms (NASDAQ: META) is trading at $629.44.
• Snap (NYSE: SNAP) shares sit at $4.51 and are down 43% YTD.

If Reddit's referral base erodes, Meta Platforms and Snap could benefit competitively for the same digital ad dollars, though that is a potential risk rather than a reported outcome.

Alphabet stock is little changed, up less than 1%, as its sheer scale absorbs the headline.

The Global X Social Media ETF (NASDAQ: SOCL) holds Reddit, Meta Platforms, Snap, and Alphabet, but the fund is heavily weighted toward international names. Reddit is only 7% of net assets, so a Reddit-specific stumble barely moves the ETF. That said, the fund is a narrow, volatile, single-theme vehicle with real concentration risk.

On the ownership side, Allspring Global Investments Holdings disclosed a reduction in its Reddit stake, and COO Jennifer Wong recently sold Reddit stock. The Wong sale was executed under a pre-arranged Rule 10b5-1 trading plan, which is routine and not a directional signal.