Reddit considers blocking Google’s AI training access as $60 million annual data deal negotiations falter over traffic concerns.
Reddit shares fell 9% to $169.48 after reports the company may cut off Google’s access to its content for AI training. The move follows stalled negotiations over a $60 million annual data-licensing agreement, with Reddit seeking usage-based fees to offset lost ad revenue from reduced referral traffic.
Reddit’s Q1 revenue surged 69%, but its stock has declined 26% year-to-date, underperforming analyst price targets of $227. The company’s market capitalization stands at $32.3 billion, down from recent highs. Reddit also licenses data to OpenAI, giving it leverage in pricing discussions.
The dispute centers on Google’s AI Overviews, which answer queries directly on search pages, reducing clicks to Reddit. Executives reportedly view the platform’s human-generated data as critical for AI models, but traffic cannibalization remains a key concern.