Reddit Investor Sues Over Google Search, AI Traffic Impact (1)

Reddit Inc. misled investors about the impact of changes to Google Search‘s algorithm and artificial intelligence summaries, a proposed class action filed Wednesday said.

Share prices sank 9.3% May 21 after analysts downgraded Reddit’s stock on concerns about permanent disruptions to traffic, said the investor’s complaint filed in the US District Court for the Northern District of California.

On May 19, Wells Fargo analysts had lowered their Reddit share price target, calling Google Search’s addition of AI features a likely permanent issue for the social media platform’s user traffic, with any user reduction hindering Reddit’s advertising revenue, said the ...