Shamis & Gentile, P.A. Notifies Investors It Has Filed a Complaint to Recover Losses Suffered by Purchasers of Reddit, Inc. Securities and Sets a Lead Plaintiff Deadline of August 18, 2025

/EIN News/ -- MIAMI, June 18, 2025 (GLOBE NEWSWIRE) -- The following statement is being issued by Shamis & Gentile, P.A:

To: All persons or entities who purchased or otherwise acquired Reddit, Inc. (“Reddit” or the “Company”) (NYSE:RDDT) securities between October 29, 2024 and May 20, 2025, inclusive. You are hereby notified that the class action lawsuit Tamraz, Jr. v. Reddit, Inc., et al., Case No. 3:25-cv-05144 has been commenced in the United States District Court for the Northern District of California. For more information go to:

Securities Fraud Class Action

Impacted investors may also contact attorney Andrew Shamis at securites@shamisgentile.com or (305) 479-2299. There is no cost or obligation to you.

The complaint alleges that the social media website Reddit receives a significant portion of its user traffic from Google Search, and Reddit’s primary source of revenue is generated from advertising to users on its own platform. Throughout the relevant period, Google Search began implementing new Artificial Intelligence (“AI”) capabilities such as AI Overview that could change the nature of search results.

Defendants are alleged to have made false and misleading statements, and failed to disclose, that: (i) changes in Google Search’s algorithm and features like AI Overview were causing users to stop their query on Google Search; (ii) these algorithm changes were materially different than prior instances of reduced traffic to the Reddit website; (iii) Defendants were aware that the increase in the query term “Reddit” on search engines was because users were getting the sought after answer from Google Search without having to go to Reddit, and not because they intended to visit Reddit; (iv) this zero-click search reality was dramatically reducing traffic to Reddit in a manner the Company was unable to overcome in the short term; and (v) Defendants, therefore, lacked a reasonable basis for its outlook on user rates and advertising revenues.

On May 1, 2025, after the market close, Reddit issued an earnings release announcing its first quarter 2024 financial results for the period ending March 31, 2025. The earnings release revealed that Reddit had experienced three consecutive quarters of deceleration in daily active user growth.

On this news, the price of Reddit’s common stock fell $4.96 per share, or 4.2%, from a closing price of $118.79 per share on May 1, 2025, to a closing price of $113.83 per share on May 2, 2025.

Then, on May 19, 2025, Wells Fargo analysts downgraded Reddit’s stock and lowered their price target to $115 per share from a previous $168 per share. Wells Fargo called Google Search’s implementation of new AI features as likely “permanent” disruptions on user traffic for Reddit.

On this news, the price of Reddit’s common stock fell $5.24 per share, or 4.6%, from a closing price of $113.23 per share on May 16, 2025, to a closing price of $107.99 per share on May 19, 2025.

Finally, on May 21, 2025, Baird analysts substantially downgraded Reddit’s stock, reducing the price target to $120 per share from the previous $140 per share. Citing similar concerns as the Wells Fargo analysts, Baird analysts additionally noted the new and disruptive developments in Google Search that had just been presented at the Google I/O developer conference.

On this news, the price of Reddit’s common stock fell $9.79 per share, or 9.3%, from a closing price of $105.64 per share on May 20, 2025, to a closing price of $95.85 per share on May 21, 2025.

If you suffered a loss in Reddit securities, you have until August 18, 2025 to request that the Court appoint you as lead plaintiff. Your ability to share in any recovery doesn’t require that you serve as a lead plaintiff.

About Shamis & Gentile P.A.

Shamis & Gentile, P.A. stands out as an advocate for investors who are victims of securities fraud. The firm is committed to securing recoveries for investors who have incurred damages due to false and misleading statements or other corporate misconduct by public companies. Shamis Gentile has recovered over $1 billon for consumers nationwide. Its extensive experience, expertise, and resources enable the firm to resolve disputes in a wide range of matters, including class actions, mass torts, and mass arbitrations.

Contact

Andrew Shamis
Shamis & Gentile, P.A.
14 NE 1st Ave, Ste 705
Miami, FL 33132
securites@shamisgentile.com
Tel: (305) 479-2299
www.ShamisGentile.com