Reddit Unveils AI-Powered Ad Tools To Enhance Brand Engagement, But Retail Remains Skeptical

Reddit’s AI tools, Reddit Insights, and Conversation Summary Add-ons, will help marketers analyze trends and boost ad engagement by featuring positive user comments.

Reddit Inc. (RDDT) stock traded over 4% higher on Monday after the company introduced a suite of AI-driven advertising tools at the 2025 Cannes Lions International Festival of Creativity, aiming to enhance brand engagement. 

These tools utilize Reddit's repository of over 22 billion posts and comments, offering brands an opportunity to tap into real-time user conversations.

The tools launched include Reddit Insights and Conversation Summary Add-ons. Reddit Insights is an AI-powered social listening tool that provides marketers with real-time, data-driven insights to inform campaign strategies and validate creative concepts. 

Conversation Summary Add-ons integrates positive user comments directly beneath advertisements, boosting authenticity and fostering deeper connections with audiences.

By focusing on collective insights from user discussions rather than individual influencers, Reddit aims to offer brands a more genuine and impactful way to engage with consumers. 

Early adopters have reported success using Reddit Insights to validate creative concepts, monitor brand sentiment, and identify cultural trends. 

For instance, campaigns for The Hershey Company and Comcast have benefited from the tool's ability to uncover new audiences and enhance brand awareness through community-driven feedback analysis.

Additionally, Conversation Summary Add-ons have shown promising results in early tests, with a 19% higher click-through rate compared to standard image ads. 

A Reuters report stated that WPP Media lowered its global ad revenue growth forecast from 7.7% to 6%, driven by shifting U.S. trade policies. 

The community-based social media network saw its daily active unique users (DAUq) climb 31% yearly to 108.1 million in the first quarter (Q1), slower than the fourth quarter's 39% growth.

In Q1, the company’s revenue surged 61% year-on-year to $392.4 million, surpassing the analyst consensus estimate of $369.68 million, as per Finchat data.

For the second quarter, Reddit anticipates revenue of $410 million to $430 million, against an estimated $424.42 million. 

On Stocktwits, retail sentiment around Reddit remained in ‘bearish’ territory with a ‘low’ message volume.

Reddit stock has lost 25% year-to-date and has more than doubled in the last 12 months.

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