By Jaspreet Singh <\/p>\n
July 30 (Reuters) – Reddit said on Thursday that choppy search-engine traffic affected U.S. user growth in the second quarter, overshadowing an upbeat \u200crevenue forecast and sending its shares down around 13% in extended \u200ctrading. <\/p>\n
The social media company operates in a highly competitive market. Bigger rival Meta through its Threads communities \u200bhub and new Forum app for Facebook Groups users appears to be directly targeting Reddit’s core community model. <\/p>\n
“Search referrals were choppy in the quarter, and traffic was more volatile later in the quarter, but the bigger picture is unchanged: the commercial business is \u200cstrong,” co-founder and CEO Steve \u2060Huffman said in a letter to shareholders. <\/p>\n
Growth in its U.S. daily active unique visitors (DAUq) slowed to 6% in the second quarter from \u20607% in the prior three-month period. Global DAUq rose 18% from a year earlier to 130.3 million and was slightly higher than prior quarter growth. <\/p>\n
COO Jen Wong told Reuters \u200bthat “SEO headwinds” \u200bcaused by changes in search algorithms “more than \u200boffset” the company’s efforts in \u200cterms of user acquisition in the quarter. <\/p>\n
Still, product improvements are helping convert lower-engagement visitors from search engines into loyal app users, she said. <\/p>\n
Reddit also forecast slower revenue growth in the third quarter. However, the forecast range of $860 million to $870 million was above LSEG-compiled analysts’ average estimate of $829.1 million. <\/p>\n
“The company’s advertiser growth in the second quarter \u200cwas 70% year-over-year. So, we continue to onboard \u200ba lot more new advertisers onto Reddit,” Wong said. <\/p>\n
She \u200badded the growth was particularly \u200bstrong among mid-market and small- and medium-sized businesses and international advertisers. <\/p>\n
The \u200ccompany’s AI-powered tools are designed to \u200benhance campaign performance by \u200boffering a library of successful ads, generating Reddit-specific ad copy, tracking visitor actions after exposure and enabling interest and community-based targeting within subreddit discussions. <\/p>\n
Second-quarter revenue \u200brose 61% to $805 million, beating \u200cestimates of $730.4 million. <\/p>\n
Reddit expects quarterly adjusted earnings before interest, taxes, depreciation \u200band amortization of $385 million to $395 million, above estimates of $369 million. <\/p>\n
(Reporting by Jaspreet \u200bSingh in Bengaluru; Editing by Sriraj Kalluvila) <\/p>\n","protected":false},"excerpt":{"rendered":"By Jaspreet Singh July 30 (Reuters) – Reddit said on Thursday that choppy search-engine traffic affected U.S. user…\n","protected":false},"author":2,"featured_media":567586,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[345,343,344,85,46,256818,3123,17582,256819,125],"class_list":["post-567585","post","type-post","status-publish","format-standard","has-post-thumbnail","category-artificial-intelligence","tag-ai","tag-artificial-intelligence","tag-artificialintelligence","tag-il","tag-israel","tag-quarter-growth","tag-reddit","tag-revenue-growth","tag-search-engine-traffic","tag-technology"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/567585","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=567585"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/567585\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/567586"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=567585"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=567585"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=567585"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}