Reddit Jumps 15% on S&P 500 Entry as AI Deals Threaten 90% Ad Revenue
Updated
Updated · Yahoo Finance · Aug 15
Reddit Jumps 15% on S&P 500 Entry as AI Deals Threaten 90% Ad Revenue
3 articles · Updated · Yahoo Finance · Aug 15
Summary
Reddit’s S&P 500 addition next week has driven a double-digit stock rebound after a rough 2026, with index-tracking funds expected to buy shares ahead of its Aug. 18 inclusion.
More than 90% of Reddit’s revenue still comes from advertising, leaving executives debating whether lucrative AI licensing deals could cannibalize the core ad business.
Wall Street has rewarded Reddit when it announces AI partnerships but turned colder once new licensing deals dried up, even as ad revenue kept growing and Q2 revenue rose 61% to $805 million.
That tension leaves Reddit trying to sell itself as both a source of authentic human conversation and a training ground for AI models—a strategy that could eventually weaken the user value it monetizes.