Reddit's Q3 User Miss Led by Soft Search-Referral Traffic, BofA Says

10:59 AM EDT, 10/30/2026 (MT Newswires) -- Reddit's (RDDT) Q3 user miss was driven by weaker search-referral traffic, which declined further in October, with current trends pointing to a low-double-digit decline in daily active users in Q4, BofA Securities said Friday in a note. Reddit's Q3 revenue was $895 million, exceeding Street estimates. Q3 daily active users were 130.3 million, below the Street consensus, driven by a decline in Google search referral traffic, according to the note. The company is shifting marketing spend toward app installs and plans to test a logged-in-only experience internationally in Q4, BofA noted. The firm expects the transition to a logged-in user experience to take multiple quarters and weigh on headline traffic trends, the note added. However, the change could result in a higher quality user base, improve monetization and eliminate the Google traffic overhang, the brokerage said. BofA expects sentiment to remain subdued for a few quarters until Reddit demonstrates positive growth momentum for US logged-in users. BofA kept a neutral rating on Reddit and lowered its price target to $135 from $190. Shares of Reddit were down 26% in Friday trading. Price: 95.24, Change: -34.36, Percent Change: -26.51