Throughout Reddit’s Q2 2024 earnings call Tuesday, cofounder and CEO Steve Huffman stated that Reddit’s 342 million energetic customers are more and more utilizing the platform as a search engine, leading to over one billion inside searches per 30 days.
Huffman additionally defined how AI may draw customers deeper into Reddit whereas including some promoting {dollars} to the corporate’s income. AI may assist moderate content on Reddit to make the location safer and switch it right into a search powerhouse.
“Search on Reddit is a big alternative,” Huffman stated, on the decision. “Many new customers run a search… they’re actually typing right into a field precisely what they’re involved in. So it is [a] actually essential client product service space.”
Huffman stated that Reddit will begin testing new AI search end result pages with summaries and proposals “later this 12 months” to assist customers discover solutions and new communities. Google, at the moment the biggest search engine on the planet with over 90% of the market, rolled out AI search results earlier this 12 months to blended opinions and has since scaled back the function.
Huffman additionally stated that AI search held long-term promoting potential, which may improve the platform’s income. Reddit famously did not make a profit within the practically 20 years it operated earlier than it went public in March, however Huffman stated that the platform was now worthwhile on an adjusted EBITDA (earnings earlier than curiosity, taxes, depreciation, and amortization) foundation.
“For the second consecutive quarter, we had optimistic money movement,” he stated. Reddit has solely launched two quarterly reports thus far.Reddit CEO Steve Huffman. Picture Credit score: Spencer Platt/Getty Photos
Huffman additionally talked about extra ways in which customers may make cash off of Reddit. The workforce is engaged on getting the developer platform monetized “this 12 months” in order that creators can earn cash, he defined.
Associated: Here’s Your Cheat Sheet of AI Tools That Actually Work, According to Real Entrepreneurs
Although Redditors could quickly be capable to monetize conversations, Huffman reassured shareholders that Reddit would not change into one other YouTube or Twitch. The present free communities on Reddit will continue to grow and present, with the paid subreddits present alongside them.
“In my expertise on Reddit, at any time when we add mainly a brand new manner of utilizing Reddit, what occurs is it expands Reddit, however we have not seen it cannibalize present Reddit,” Huffman stated. “Now we are going to unlock the door for brand spanking new use instances, new forms of subreddits that may be constructed which will have unique content material or personal areas, issues of that nature.”
The remainder of Reddit’s report confirmed that income for the second quarter was up 54% year-over-year, hitting $281.2 million. The expansion was led by a 41% improve in advert income, which jumped to $253.1 million.
The platform’s each day energetic customers additionally grew by 51% to 91 million.
Reddit has content material licensing offers with Google and ChatGPT-creator OpenAI.
Associated: Reddit Traffic Nearly Triples in 8 Months, Posts Rise to the Top of Google Search