Snap confirms $400M Perplexity AI deal ended amicably in Q1

Snap confirmed on Wednesday that its $400 million partnership with the AI search startup Perplexity has been terminated. The announcement was made as part of Snap's first-quarter earnings report, where the company noted that the deal ended amicably. This partnership, which was first unveiled in November 2024, represented a significant attempt to bring advanced conversational search capabilities to the Snapchat platform.^[1][2]

The primary objective of the agreement was to integrate Perplexity’s conversational AI search engine directly into Snapchat’s Chat interface. This integration would have allowed users to interact with the AI search tool without leaving the messaging app. Under the original terms, Perplexity was slated to pay for the integration, which was valued at approximately $400 million over the course of the deal.^[1][2]

While the specific reasons for the termination were not detailed in the earnings report, both companies have indicated that the conclusion of the deal was not contentious. The move comes as social media platforms continue to experiment with various AI integrations to enhance user engagement and provide new utility within their ecosystems. Snap's decision to reveal the end of the partnership during its quarterly financial update highlights the scale of the intended collaboration.^[1][2]