Reddit’s $465 Million Ad Boom Faces a Bot-Fueled Bust—But Can It Survive the AI Flood?

Reddit has surged in prominence over the past year, benefiting from two fast-growing monetization channels: AI licensing and advertising. With daily active users (DAUs) up 21% year-over-year and advertising revenue soaring 84% to $465 million in Q2 2025, Reddit is experiencing its most profitable quarters ever. Strategic licensing agreements with OpenAI and Google have brought highmargin revenues to the company, capitalizing on Reddit’s vast trove of authentic, human-generated content. However, this same authenticity is now under threat. AI-generated spam, content farms, and bots are beginning to infiltrate Reddit’s communities, threatening the very quality that underpins its appeal to both users and enterprise partners. Reddit is now battling on two fronts: maintaining platform integrity against a deluge of machine-generated posts, while simultaneously monetizing the unique data and high-intent user base that AI and advertisers covet. This paradox poses strategic and operational challenges as Reddit attempts to scale revenue without sacrificing the human touch that built its brand.