Oct 30 : Shares of Reddit and Pinterest fell in premarket trading on Friday, after Reddit warned that Google's AI search features could shrink its user base, and Pinterest forecast weak fourth-quarter revenue.
Reddit shares tumbled 23 per cent, while Pinterest slumped 8 per cent.
Here are more details:
• Reddit said search engine referrals fell by more than 1 million on average each week in October
Guess WordCrack the word, one row at a timeBuzzwordCreate words using the given lettersMini SudokuTiny puzzle, mighty brain teaserMini CrosswordSmall grid, big challengeWord SearchSpot as many words as you can Show More Show Less• Total daily active unique visitors could fall by a low double-digit percentage in the fourth quarter from about 130 million if referral traffic continues to fall, Reddit added
• JPMorgan analysts said the expansion of Google's AI Overviews and AI Mode, along with changes to how machine-translated content ranks, has pushed search traffic down
• A reset in expectations is appropriate, and the near-term outlook is increasingly clouded, Piper Sandler analysts added
• Reddit said in a filing it had extended its cloud services agreements with Amazon Web Services and Google through 2029, committing to spend $880 million and $580 million, respectively, over three years
• Pinterest's third-quarter revenue of $1.17 billion missed the LSEG-compiled estimate of $1.21 billion
• Pinterest forecast fourth-quarter revenue of $1.425 billion to $1.475 billion, below Wall Street estimates
• RBC analysts said changes to the EU's de minimis exemption hit cross-border sellers sooner and harder than expected, leaving Pinterest's European revenue flat
• Reddit had fallen about 44 per cent this year and Pinterest about 23 per cent through Thursday's close
• If current losses hold, Reddit is set to lose $5.7 billion in market value and Pinterest about $900 million