"Reddit ( RDDT) stock fell as much as 8% in early trading Wednesday, extending a 5% decline from the previous trading session amid new data that showed the use of its content in leading AI chatbot ChatGPT had plummeted in mid-September. Reddit content was cited in just 2% of ChatGPT responses on Tuesday, much lower than the 9.7% of ChatGPT responses that cited Reddit the previous month, according to data from AI search engine tracker Promptwatch."
"Reddit is often used as a social media version of a search engine, with users frequently appending "reddit" to online queries when looking for advice or instructions. Google ( GOOG, GOOGL) still dominates "traditional" online search. That means Reddit, like other search resources, faced a potentially existential threat with the rise of AI chatbots, beginning with the launch of ChatGPT in late 2022."
Reddit citations in ChatGPT responses plunged in mid-September, falling to 2% from a prior monthly average of 9.7% and a September peak above 14%, according to Promptwatch. Reddit remained the most-cited social platform in September with a 4.3% average, while LinkedIn trailed at 0.4%. Reddit's stock fell as the citation decline extended a prior drop. Reddit secured billion-dollar data licensing deals with OpenAI and Google and explored dynamic pricing tied to usage. Reddit has also launched its own AI search and advertising tools to monetize content and compete amid chatbot-driven shifts in search behavior.
Read at Yahoo Finance
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