OpenAI may pay Reddit $70M for licensing deal

2025-02-14 00:00:05

Reddit reported its earnings last night, and while it underperformed in terms of user growth (thanks to Google), the earnings report seemed to highlight how much OpenAI is paying Reddit to license its content.

As per Adweek, between Google and OpenAI, its AI licensing deal brings in about 10% of its revenue. 10% of its revenue is about $130 million. We know Google paid about $60 million to Reddit for its content deal, and the only other known company to have a deal with Reddit for its content is OpenAI. That leaves OpenAI paying $70 million to Reddit for its licensing deal.

More details. I spotted this via Glenn Gabe who posted about this on X and wrote:

Rough math, but interesting :) Reddit told AdWeek that its AI licensing deals make up about 10% of its revenue. Annual revenue for Reddit in 2024 was $1.3B, so 10% is $130M. Google pays Reddit $60M so that means OpenAI is paying Reddit about $70M per year. That number has never been revealed. Again, interesting.

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I am not sure if we knew how much OpenAI paid for the content licensing deal for Reddit, but now we seem to.

Why we care. I am not financial expert, and I rarely cover financial news but Reddit seems like an interesting stock. It’s stock price dropped 15% in after hours trading after it did not meet user growth expectations, which Reddit’s CEO noted may have been due to Google Search’s algorithm changes. Also, Reddit seems to have two content licensing deals that make up about 10% of its revenues.

Either way,  was already facing backlash among SEOs because Google appears to be favoring the platform in the Discussions and forums SERP feature. Reddit is even outranking original sources of content in some instances.