Social media company Reddit (RDDT) is engaged in talks with Google parent company Alphabet (GOOGL) regarding a new content licensing agreement related to artificial intelligence (AI).
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Reddit already has a data‑licensing contract in place with Alphabet reportedly worth $60 million. However, the company known for its online messaging boards is now seeking a new agreement that will include participation in future AI training and search features.
The licensing agreements essentially allow Alphabet to feed Reddit’s online content into its Gemini chatbot and other AI applications. Technology companies are striking a growing number of content deals as they train and develop their AI models.
Content Deals
Reddit also has a licensing agreement related to AI with privately held OpenAI, which operates ChatGPT. Management at Reddit has said that deals to use its content have generated more than $200 million in revenue for the company in recent years. Most licensing deals run for two to three years.
Talks with Alphabet over a new content licensing agreement are said to be in the early stages. Reddit is anticipating revenue in the current third quarter of $535 million to $545 million, against a consensus estimate of $545.9 million. RDDT stock is up 57% in 2025.
Is RDDT Stock a Buy?
The stock of Reddit has a consensus Moderate Buy rating among 24 Wall Street analysts. That rating is based on 16 Buy and eight Hold recommendations assigned in the last three months. The average RDDT price target of $219.04 implies 14.52% downside from current levels.
