Overview
- Reddit disclosed Tuesday that it has begun a limited test placing paid ads directly inside its in-app search results, with ads chosen for their contextual relevance to a user’s search terms.
- The pilot is restricted to a select group of eligible advertisers and Reddit says it will study user response before deciding how broadly to roll the format out.
- The test follows a third-quarter report that beat revenue estimates but included weaker fourth-quarter guidance and a drop in U.S. daily active users, which the company tied to fewer referrals after Google added AI answers to search.
- Reddit has also announced a planned move to a logged-in-only browsing model to make scraping harder and to give advertisers more precise signals for targeting ads.
- If expanded, the change could reduce casual discovery for unregistered visitors, alter moderators’ and researchers’ access to content, and provide a new revenue stream that investors hope will offset traffic losses.