Reports indicate that Reddit is considering blocking Google from using its platform's content to train artificial intelligence models, a move that sent the company's shares sharply lower.

Reddit (RDDT) stock fell 9% on Wednesday following the news. The company is reportedly reevaluating the value of its partnership with Google, as the search giant increasingly prioritizes showing AI-generated summaries to users, which reduces traffic to external websites like Reddit.

Alphabet (GOOGL) and Reddit had entered into an agreement in 2024 allowing the search giant to use Reddit's data for AI training. However, the rollout of Google's AI Overviews feature, which provides answers directly on the search results page, has led to a significant decline in referral traffic to publishers and news sites.

Data cited in the report shows widespread traffic declines from Google for similar websites between June 2025 and 2026, with drops of 23% for Politico, approximately 25% for CNN, and over 85% for Business Insider.

Many media and publishing companies are now reassessing their relationships with leading AI firms. Some platforms, facing lost search traffic, have turned to litigation to protect their intellectual property.

Last year, Chegg filed a lawsuit against Google in federal court, alleging that the AI summaries in search results were harming its website traffic and revenue.

In response to such concerns, Google has stated that its AI features help content creators and publishers reach wider audiences, noting it sends billions of clicks to websites annually.

The annual $60 million agreement between Reddit and Google is nearing its expiration, and the two companies are currently in discussions about its renewal.

Reddit also has a similar data licensing deal with OpenAI, allowing the ChatGPT developer to use its content for AI model training. This data licensing business contributed to the company's better-than-expected performance last quarter.

In its first-quarter earnings report, Reddit's revenue surged 69% year-over-year, significantly exceeding analyst forecasts with earnings per share of $1.01 versus an expected $0.58 and revenue of $663 million versus an expected $611 million.

Reddit CEO Steve Huffman told analysts on the earnings call that the partnerships with Google and OpenAI are important and valuable, emphasizing the company's ongoing commitment to these relationships.

Reddit is scheduled to report its second-quarter financial results on July 30.