Reddit plans to make people log in to use the site, and will begin testing the change in some countries outside the US this quarter. In its third-quarter shareholder letter, published on 29 October, the company also warned that its daily user count could fall by a low-double-digit percentage in the fourth quarter because traffic from search engines is dropping fast.
That warning came alongside some of Reddit’s strongest financial results. Revenue rose 53% to $895 million in the three months to 30 September, according to its results release. The letter shows Reddit facing two problems at once: it is growing as a business while losing the stream of casual visitors that search has long sent it, and it now wants more of those visitors to sign in.
Search is sending fewer people
Reddit says its search referral traffic was “down meaningfully” in the third quarter, with the decline speeding up later in the quarter. The biggest effect was on logged-out and web traffic, but some of it reached logged-in and app users too, because search is a common way people come back to Reddit. The fall has continued into October. “During October, we have seen that search traffic has dropped by more than 1 million referrals on average per week,” the letter says. If that rate continues, Reddit says, its daily active uniques, or DAUq, could fall in the fourth quarter by a low-double-digit percentage from the current base of 130 million.
The quarterly figures show where Reddit is exposed. Global DAUq held at 130.3 million, the same as in the second quarter and up 12% on a year earlier. In the US, though, DAUq fell to 50.7 million, from 53.2 million in the second quarter and 51.6 million a year earlier. International users kept growing, up 24% to 79.6 million.
Most of Reddit’s daily audience still does not sign in. Logged-out DAUq were 76.8 million in the quarter, against 53.5 million logged-in. In the US, logged-out users fell 4% from a year earlier, to 27.3 million. Reddit says logged-in and app users make up “the vast majority of engagement” and more than 80% of its monetisation, and that both groups grew from the second quarter.
The letter does not say which search engines are sending less traffic or why. It places the change against a broader shift, describing web search as moving “from a gateway to the web to becoming an AI-powered destination itself”. Google’s owner reported its own results a day earlier, with Alphabet’s revenue up 25%. How AI systems find web pages is also changing: Cloudflare and OpenAI said this month that a network-signal pilot helped ChatGPT search discover hundreds of millions of new pages.
Why Reddit wants people to sign in
Chief executive Steve Huffman wrote that “a key piece of work to retain new audiences is shifting Reddit to a logged-in-only experience”. He called it “a big one for us, and it’s a big one for me.”
He gave several reasons. Signed-in users get a more relevant experience, he wrote, and “It is better for our business because we will have more signals for ads targeting”. Being logged in also “allows us to protect access to Reddit’s extremely valuable corpus of data, and helps us better adapt to emerging regulations around the world.” He did not say which regulations he meant.
“In Q4 we’ll begin fully testing this in select markets outside the U.S.,” the letter says. “The results of those tests will inform an optimized version of logged-in-only Reddit globally.” Reddit did not name the test markets, give a date for a wider rollout, or explain what someone who follows a Reddit link from a search result will see. Huffman argued that “Pretty much all of the major ad-based platforms have gone through this transition.”
Reddit is also trying other ways to keep new visitors. It plans an improved incognito mode in the app and wants to move more mobile web users into the app, noting that only about 13% of eligible mobile web users currently see its app prompt.
A UK backdrop
Reddit’s letter does not mention the UK, and nothing in it says the UK will be a test market. Britain is, though, one place where regulators have already examined who can see Reddit without an account. In February, the Information Commissioner’s Office issued a penalty notice requiring Reddit to pay £14,472,500 for breaches of UK data protection law over its handling of children’s personal data. The notice says that until July 2025 Reddit had no form of age assurance, and that the platform “was available to view by anyone who landed on it”. Ofcom is separately reviewing which content counts as harmful to children under the Online Safety Act.
The results behind the warning
Advertising revenue rose 54% to $847 million in the quarter, and net income rose to $283 million from $163 million a year earlier. For the fourth quarter, Reddit expects revenue of $1,000 million to $1,030 million and adjusted EBITDA of $480 million to $510 million. Its forward-looking statements now list “plans, timing, and the anticipated effects of a logged-in-only experience” among the matters that may not turn out as expected.
Trading open access for signed-in users
This is TSN’s analysis. Reddit is choosing to give up some of the reach that made it one of the web’s best-known answer sources in exchange for users it can identify. The trade makes commercial sense on its own figures: signed-in and app users bring in more than 80% of the money, while the logged-out majority is the group most exposed to falling search traffic. If those visitors are slipping away anyway, asking the ones who remain to sign in costs Reddit less than it would have a few years ago.
The data point matters as much as the advertising one. Huffman links logging in to protecting Reddit’s corpus, and large archives of human writing have become something AI companies pay for, as news groups such as CNN, in its deal with Google, have shown. A wall around the site makes that corpus harder to collect without permission, which strengthens Reddit’s hand in any licensing talks.
The risk is to the open web habit itself. Many people know Reddit from a search result they read without an account. If a sign-in screen greets them instead, some will sign up, and others will leave. That is why the choice of test markets, and the numbers Reddit reports from them, will matter more than the strategy’s rationale. Regulators that have scrutinised children’s access to the site may also take an interest in how sign-in and age checks fit together. The first evidence should come with Reddit’s fourth-quarter results, when the company will show whether its daily users fell as far as it warned.
Sources
- Reddit: Q3 ’26 Shareholder Letter, 29 October 2026 (PDF)
- Reddit Investor Relations: Reddit Reports Third Quarter 2026 Results, 29 October 2026
- Information Commissioner’s Office: Penalty Notice, Reddit, Inc., 23 February 2026 (PDF)
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