Reddit shares jumped 11% in late buying and selling following the announcement.

The settlement “will enable OpenAI’s AI tools to better understand and showcase Reddit content, especially on recent topics,” the businesses stated Thursday in a joint assertion. Reddit can even supply its customers new AI-based instruments constructed on OpenAI’s fashions, and OpenAI will develop into a Reddit promoting companion. Terms of the deal weren’t disclosed.

Reddit final week launched new insurance policies governing using its knowledge, a part of an effort to extend income by way of licensing agreements with synthetic intelligence builders and different firms. The firm, which offered shares in an preliminary public providing in March, additionally signed an accord in January with Alphabet Inc.’s Google value $60 million to assist practice massive language fashions, the expertise underpinning generative AI. The San Francisco-based social community has signed licensing offers value $203 million in whole, with phrases starting from two to a few years.

OpenAI, for its half, is more and more forging partnerships with media firms to assist practice its AI methods and present extra real-time content material inside its chatbot. The ChatGPT maker additionally penned offers with Dotdash Meredith earlier this month and the Financial Times in April.

Sam Altman, chief government officer of OpenAI, has a protracted historical past with Reddit — he was one of many firm’s largest shareholders on the time of its IPO earlier this yr, and briefly served as Reddit’s interim CEO in 2014. The firms famous within the assertion that their partnership was led by OpenAI Chief Operating Officer Brad Lightcap, and was authorized by its unbiased administrators.

The shares of Reddit, which had declined 5.5% to $56.38 in New York buying and selling, soared as excessive as $64.75 after the partnership was introduced. The inventory has gained 66% since its IPO.