<div id="readability-page-1"><div><div>Reddit Inc. RDDT is gaining increased visibility in Alphabet Inc.'s GOOG GOOGL Google's AI Overviews, but analysts say that traffic boost may not translate into meaningful revenue growth.What Happened: According to data from analytics firm Semrush, Reddit is the second most-cited source in Google's AI-generated summaries, trailing only Quora.The rise is likely tied to a $60 million content licensing deal Reddit signed with Google in 2024, which allows Google to use Reddit data to train its AI systems and display it more prominently in search.&#34;Quora and Reddit users often ask and answer niche questions that aren't addressed elsewhere,&#34; the Semrush report said, adding, &#34;Making them rich information sources for highly specific AI prompts.&#34;But while this exposure is boosting Reddit's web traffic, it's coming largely from &#34;logged-out users&#34;—people who click Reddit links from Google but don't sign in or stick around, reported Business Insider.Analysts at Redburn wrote in March, &#34;Accelerated user growth has been driven predominantly by logged-out users who arrive on the platform largely via Google Search.&#34;&#34;These users are much less valuable to Reddit as they are typically just looking for an answer to a query and thus spend little time on the platform,&#34; the analyst continued, the report added.Moreover, with Google's AI Overviews summarizing Reddit content directly on the search page, fewer users may click through to Reddit at all, the report said.Today's Best Finance DealsWhy It's Important: Reddit, which went public in 2023, is under mounting pressure to grow ad revenue and prove long-term profitability, the report noted.While its partnership with Google has increased exposure, the quality of that traffic matters more than volume.As Google leans more heavily on AI-generated answers, Reddit may find itself widely cited but less visited, posing a challenge for monetization. Last month, Google launched a new &#34;AI mode&#34; in Search and Chrome for U.S. users, providing a ChatGPT-like conversational experience instead of traditional search results.Price Action: Reddit shares have declined 28.77% year-to-date but have surged 95.82% over the past 12 months, according to Benzinga Pro data.Benzinga's Edge Stock Rankings show a steady upward trend for Reddit in the short and long term, while reflecting a downward movement in the medium term. Additional performance insights are available here.<ul> <li>Dow Jones Breaks 43,000, Palantir Hits New Record Highs: What's Driving Markets Wednesday?</li> </ul>Photo courtesy: Henry Franklin/Shutterstock</div></div></div>

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Reddit Inc. is now the second most-cited source in Google's AI Overviews, following Quora, due to a $60 million content licensing deal with Google. However, analysts warn that the increase in traffic is primarily from logged-out users, who are less valuable for ad revenue. This trend poses challenges for Reddit's monetization efforts, especially as Google integrates AI-generated answers directly into search results. Despite a 95.82% increase in shares over the past year, Reddit's stock has dropped 28.77% year-to-date, highlighting concerns about long-term profitability.

- Reddit Inc. is gaining visibility in Google's AI Overviews, becoming the second most-cited source after Quora, due to a $60 million content licensing deal with Google.  
- Despite increased web traffic, primarily from logged-out users, analysts warn that this may not lead to significant revenue growth, as these users typically do not engage deeply with the platform.  
- As Google emphasizes AI-generated answers, Reddit faces challenges in monetization, needing to convert this traffic into valuable, engaged users to ensure long-term profitability.  

Reddit Is The Second Most-Cited Source In Google AI Overviews, But Logged-Out Traffic May Undercut Revenue Gains