Snap and Perplexity End $400M AI Deal

AI Summary

Snap has ended its $400M deal with Perplexity, which would have integrated Perplexity's AI search engine into Snapchat. The deal's termination was revealed in Snap's quarterly earnings report.

The End of a Lucrative Partnership

Snap has ended its $400M deal with Perplexity, a company that specializes in AI search engines. The deal, announced last November, would have seen Perplexity's technology integrated directly into Snapchat.

Details of the Failed Partnership

The deal was worth $400 million in cash and equity over one year.
Perplexity's AI search engine was to be integrated into Snapchat's 'Chat' interface.
The partnership was expected to contribute to Snap's financials in 2026.
Snap and Perplexity 'amicably ended the relationship in Q1.'

Impact on Snap's Financials

Snap's sales guidance 'assumes no contribution from Perplexity.' The company revealed that its global daily active users (DAU) rose 5% year-over-year to 483 million, while monthly active users (MAU) also grew 5% to reach 965 million.

The Future of AI Integration

Snap CEO Evan Spiegel had previously stated that the deal reflected the company's vision to use AI to enhance discovery on Snapchat. The company remains focused on investing in AI and other technologies, such as intelligent eyewear.

What's Next for Snap and Perplexity

While the deal with Perplexity has ended, Snap continues to explore other partnerships and technologies to enhance its platform. The company will share more about its plans at AWE on June 16th.