Reddit CEO Steve Huffman confirmed that the company is moving "to a logged-in-only experience," according to a letter to shareholders about third-quarter performance. Huffman wrote that Reddit will start testing the login requirement in "select," non-US markets in the fourth quarter. The company will use those tests to decide what a logged-in-only Reddit will look like "globally," he said.
Huffman said the change will help users "find the content and communities most relevant to them." He also said it is better for the business because Reddit will have "more signals for ads targeting," and that logged-in users engage more. He added that it "allows us to protect access to Reddit's extremely valuable corpus of data, and helps us better adapt to emerging regulations around the world." He said the requirement will also help Reddit retain new users.
The announcement comes as Reddit search referral traffic "was down meaningfully in Q3," Huffman wrote. He said search traffic has dropped by more than 1 million referrals on average per week in October. He wrote that if that rate of decline continues, total daily active unique users (DAUqs) could fall in the fourth quarter by a low-double-digit percentage from the current base of 130 million. Reddit's average DAUqs rose 12 percent year over year in the third quarter.
Ars Technica reported that Reddit has been testing a login requirement on desktop since at least August, based on user reports. The outlet also reported that Reddit has made earlier changes, including requiring users to be logged in to use Old.Reddit.com and effectively shutting most third-party apps by making its API expensive in 2024.
Reddit reported third-quarter net income of $283 million, a 74 percent year-over-year increase, on revenue of $895 million, a 53 percent year-over-year increase.