Huffman focuses on logged-in users
Reddit is clearly moving toward "a logged-in-only experience" to reduce dependency on search referrals. Huffman wrote that "logged-in and app DAUq are our most valuable users, and they are our primary focus." User reports indicate Reddit has tested login requirements on desktop since at least August. The login requirement is one of many changes that Reddit has made over the past couple of years aimed at growing its user base of its website and mobile apps that also make it easier to track user activity. These changes help Reddit manage AI scraping and evolving search habits while making the site more appealing to advertisers and investors.
The company is also testing a requirement for users to use a mobile app to access the mobile website, a move that Huffman said has room to scale because "currently only about 13 percent of eligible mobile web users are seeing the app conversion prompt." This mobile testing follows a series of restrictions, including a July requirement that users log in to use Old.Reddit.com and a more recent block on access for anyone who had not logged in within the previous six months. These updates follow the 2024 decision to effectively shutter most third-party apps by making the Reddit API expensive. These combined changes should make it significantly easier for Reddit to understand who uses the platform and why.
User growth and financial results
Reddit reported $895 million in revenue for Q3, a 53 percent year-over-year increase, and a net income of $283 million, which represents a 74 percent year-over-year increase. The company also saw its average number of DAUqs increase 12 percent year-over-year in Q3. Advance Publications, which owns the parent company of Ars Technica, Conde Nast, remains the largest shareholder in Reddit. The 12 percent increase in DAUqs occurred during the same quarter that the company reported its significant revenue and net income growth.
| Metric | Q3 Performance | Year-over-Year Change |
|---|---|---|
| Revenue | $895 million | 53 percent increase |
| Net Income | $283 million | 74 percent increase |
| Average DAUqs | 12 percent increase | 12 percent increase |
The platform intends to use data from logged-in users to understand user activity and gain additional insight into how advertisers interact with the site. This strategy helps Reddit respond to AI scraping and changing search habits. By prioritizing logged-in accounts, the company can better understand who uses Reddit and why, which assists in managing the platform. These changes, including the 2024 API pricing shift that effectively shuttered most third-party apps, work together to consolidate user data and decrease the impact of search referrals.
