HomeSnap confirms $400M Perplexity deal ended amicably
Snap has ended its partnership with Perplexity, the company disclosed Wednesday during its quarterly earnings report. The agreement, originally announced in November, would have integrated Perplexity's AI search engine directly into Snapchat. Under the terms, Perplexity was to pay Snap $400 million in cash and equity over a one-year period.
Snap noted that both parties "amicably ended the relationship in Q1" and that its sales outlook "assumes no contribution from Perplexity." When Snap first announced the deal during its third-quarter earnings last year, it expected revenue from the partnership to begin impacting its financials in 2026.
Under the deal, Perplexity would have been embedded within Snapchat's "Chat" interface, enabling users to ask questions and get conversational responses directly in the app. Although the feature was being tested with a limited group of users, Snap stated in February that the companies had "yet to mutually agree on a path to a broader roll out."
Snap CEO Evan Spiegel remarked at the initial announcement that the deal reflected the company's goal of using AI to enhance discovery on Snapchat, and that Snap was eager to "collaborate with more innovative partners in the future."
Perplexity did not immediately reply to TechCrunch's request for comment.
Snap reported on Wednesday that Snapchat's global daily active users (DAU) increased 5% year-over-year to 483 million, while monthly active users (MAU) also grew 5% to reach 965 million. The company attributed this growth to new features across the app, such as Snap Map and its Lenses AR filters.
In a press release, Spiegel stated, "In Q1, we returned to growth in daily active users, accelerated revenue growth, expanded margins, and generated strong free cash flow. We remain focused on disciplined execution as we invest in Specs and our long-term opportunity in intelligent eyewear, and look forward to sharing more at AWE on June 16th."
Snap announced in April that it was laying off approximately 16% of its global workforce, affecting about 1,000 full-time employees, citing advancements in AI as the reason for the cuts.
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Snap has ended its partnership with Perplexity, the company disclosed Wednesday during its quarterly earnings report. The agreement, originally announced in November, would have integrated Perplexity's AI search engine directly into Snapchat. Under the terms, Perplexity was to pay Snap $400 million in cash and equity over a one-year period.
Snap noted that both parties "amicably ended the relationship in Q1" and that its sales outlook "assumes no contribution from Perplexity." When Snap first announced the deal during its third-quarter earnings last year, it expected revenue from the partnership to begin impacting its financials in 2026.
Under the deal, Perplexity would have been embedded within Snapchat's "Chat" interface, enabling users to ask questions and get conversational responses directly in the app. Although the feature was being tested with a limited group of users, Snap stated in February that the companies had "yet to mutually agree on a path to a broader roll out."
Snap CEO Evan Spiegel remarked at the initial announcement that the deal reflected the company's goal of using AI to enhance discovery on Snapchat, and that Snap was eager to "collaborate with more innovative partners in the future."
Perplexity did not immediately reply to TechCrunch's request for comment.
Snap reported on Wednesday that Snapchat's global daily active users (DAU) increased 5% year-over-year to 483 million, while monthly active users (MAU) also grew 5% to reach 965 million. The company attributed this growth to new features across the app, such as Snap Map and its Lenses AR filters.
In a press release, Spiegel stated, "In Q1, we returned to growth in daily active users, accelerated revenue growth, expanded margins, and generated strong free cash flow. We remain focused on disciplined execution as we invest in Specs and our long-term opportunity in intelligent eyewear, and look forward to sharing more at AWE on June 16th."
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