Reddit Now Spends Millions of Dollars on AI Translation per Quarter

Reddit now spends millions of dollars on machine translation (MT) per quarter. The online network just released its Q3 2024 shareholders report (PDF), citing MT as a factor in a YOY increase of revenue and adjusted operating expenses in Q3.

During an October 29, 2024 investor call, Reddit’s CFO Drew Vollero stated that “adjusted operating expenses were up 17% year-over-year in Q3, slightly higher sequentially, driven primarily by rising people costs and machine translation costs.” 

Vollero also emphasized the “cost-effectiveness of MT” by stating that “the translation cost for each language was less than USD 1m in Q3 2024, with total spending less than 1% of revenue.” While small in the grand scheme of things for Reddit, any company spending millions of dollars per quarter on MT alone is remarkable.

The Reddit MT rollout impact has been dramatic. Reddit’s daily active users outside the US grew by 44% YOY in Q3 2024, with focus markets like France, India, and the Philippines experiencing a 53% surge.

France, the first market to experience Reddit’s rollout, has alone seen significant growth in both logged-out and logged-in traffic. French subreddits (topical Reddit communities) are fast attracting new members, with the r/france community surpassing 2 million users. 

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In communities like r/phryge, English-speaking moderators are using MT to interact with French-speaking users interested in the Paris Olympics mascot. In addition, translated posts are now appearing in search engine results. This is driving new users to local communities to discuss topics like finance, law, and education in their preferred language.

Addressing the phenomenon, Reddit’s CEO Steve Huffman said that a large number of users intentionally use Google to navigate to Reddit, which to him suggests a strong user preference for the platform. 

Huffman added that “machine translation is scaling. We drew four times as many users this quarter as we did last … And the machine translation has some other positive externalities. One is that the translated content gets indexed into other search engines.”

After going public in March, Reddit’s MT leap year began with plans to go global shared in the May 2024 shareholders call, with Huffman calling MT “the big unlock.” By the end of Q3 2024, MT was fully operational for Reddit communities in France and Spain, with translation initiated in Germany, Brazil, and Italy.

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“We plan to expand machine translation to over 30 countries through 2025. As Reddit becomes a truly global platform, we are focused on ensuring everyone, regardless of their language, can participate in and benefit from the communities on Reddit,” added Huffman.

Shares jumped on the earnings release, which added about USD 7bn to Reddit’s market capitalization.