"Reddit ( RDDT) stock pared its losses for the day following a report that it's in "early talks" with Google parent Alphabet ( GOOGL) on a new content-sharing agreement. The social media platform plans to discuss new deal structures for its content with both Google and OpenAI, according to Bloomberg. Reddit stock has rallied nearly 45% in the past three months, helped by strong Q2 results posted on July 31."
"A fast-growing digital advertising business has been the top factor for Reddit's strong stock performance. But the company has also unlocked new revenue by licensing the content on its platform to developers of AI algorithms. That includes a reported $60 million per year deal with Google last year and an OpenAI agreement with similar terms. Those deals were classified within an "Other" sales category that analysts project will contribute $141.7 million in revenue for Reddit in 2025, about 7% of its projected annual sales, according to FactSet."
Reddit is in early talks with Alphabet and plans to discuss new deal structures with both Alphabet and OpenAI. The stock has rallied nearly 45% over three months and sits more than 600% above its March 2024 IPO price, supported by strong Q2 results. A fast-growing digital advertising business remains the primary driver of performance. Reddit also monetizes platform content by licensing it to AI developers, including a reported $60 million-per-year Google deal and a similar OpenAI agreement. Analysts project those AI-licensing deals will contribute roughly $141.7 million, about 7% of 2025 sales.
Read at Investor's Business Daily
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