Reddit Stock Falls 18% Despite 53% Revenue Growth, How Does It Compare With Pinterest?

• Reddit (RDDT) stock fell 18% after hours despite 53% revenue growth, as US daily active uniques declined 2%
• Reddit’s CEO blamed Google AI search for weaker referrals, with sign-in requirements set for testing outside the US
• Pinterest stock dropped 8.58% premarket as its revenue outlook disappointed, despite reaching 661 million monthly active users

Reddit brought in more advertising money. Pinterest attracted a record audience. Neither was enough to keep investors from selling after Thursday’s earnings reports. Reddit stock fell 18% in extended trading on October 29, while Pinterest stock remained under pressure before Friday’s opening bell. Behind the declines were two different problems. This included getting people onto a platform and earning enough from those already there.

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Why Reddit Stock Fell Despite Stronger Earnings

The Reddit earnings report showed revenue rising 53% to $895 million, with advertising revenue up 54%. Diluted earnings reached $1.40 per share. But US daily active uniques fell 2% to 50.7 million, even as the global figure climbed 12% to 130.3 million. The domestic decline became harder to dismiss after CEO Steve Huffman discussed Google AI search.

“The reality is, the AI mode does not drive traffic,” Huffman said on the earnings call, according to reports. He warned that continued referral weakness could produce a low-double-digit percentage decline in global daily visitors during the fourth quarter.

Reddit plans to test a primarily logged-in experience in selected markets outside the US. The change puts more emphasis on returning users, but also asks casual visitors to take another step before browsing.

For holders of RDDT stock, the concern is whether advertising growth can hold up as the flow of visitors changes. Management forecasts fourth-quarter revenue of $1 billion–$1.03 billion.

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Reddit vs Pinterest: Different Weaknesses Emerge

The Pinterest earnings release showed a different imbalance. Monthly active users reached 661 million, up 10%, while revenue increased 12% to $1.174 billion. Global average revenue per user barely moved, rising 1% to $1.80.

Revenue missed expectations, and the holiday-quarter forecast disappointed too. Pinterest expects fourth-quarter sales of $1.425 billion–$1.475 billion. Its shares were quoted at $18.21 in October 30 premarket trading, down 8.58% from the previous regular-session close.

Europe helps explain the problem. Pinterest’s monthly audience there grew 7%, but regional revenue stayed flat at $193 million. More users had not translated into more sales

MarketCapOf’s comparison for October 1–30 shows a hypothetical $500 investment in Reddit stock falling to $435.90, a loss of 12.82%. The same investment in Pinterest would be worth $514.58, a gain of 2.92%. Pinterest finished $78.68 ahead in this calculation, despite its slower revenue growth.

Reddit’s daily visitor count and Pinterest’s monthly audience measure different things. The useful comparison is how each business converts attention into revenue. Reddit enters the holiday quarter trying to protect its traffic and Pinterest needs stronger spending from advertisers to make its audience gains count.

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