Perplexity’s $400 Million Deal Brings AI-Powered Search to Snapchat

Snap Inc. has announced a groundbreaking $400 million partnership with Perplexity, the AI startup behind a popular conversational answer engine. The agreement, revealed alongside Snap’s Q3 2025 earnings, will integrate Perplexity’s AI directly into Snapchat, giving its massive user base a new way to access real-time, research-oriented answers without ever leaving the app (TechCrunch).

Under the terms of the deal, Perplexity will pay Snap $400 million in cash and equity over one year for access to more than 940 million Snapchat users worldwide (Yahoo Finance; Silicon Republic). Starting in early 2026, the AI tool will appear within Snapchat’s chat interface, allowing users to ask questions and receive detailed, conversational responses drawn from verifiable web sources. The partnership marks Perplexity’s most ambitious expansion yet, positioning the company at the forefront of social-integrated search tools.

For Snap, this collaboration represents both a revenue boost and a strategic step toward making Snapchat a hub for AI interaction. The company reported Q3 2025 revenue of $1.51 billion, a 10% increase from last year, and narrowed its losses to $104 million, down from $153 million. Subscriptions to Snapchat+, the platform’s premium tier, have grown to over 17 million members (TechCrunch). Following the announcement, Snap’s shares surged by more than 14%, underscoring investor optimism about the new AI-driven direction (Silicon Republic).

The addition of Perplexity builds upon Snapchat’s existing AI feature, “My AI,” which is powered by models from OpenAI and Google. While My AI offers general conversational abilities, Perplexity’s engine specializes in providing factual, source-backed answers. Reviews have praised Perplexity as more reliable for research due to its “answer engine” approach, which emphasizes transparency and citation. With both AI systems soon available in the chat interface, Snapchat users could even compare outputs from the two bots side by side, fostering a new kind of interactive learning experience (Yahoo Finance).

Snap plans to begin integrating Perplexity early next year, with revenue recognition from the partnership starting in 2026. Though some users might find the presence of multiple chatbots in their inbox overwhelming, especially alongside Sponsored Snaps, Snap is betting that the payoff is worth it. As one of the largest social platforms for Gen Z, with over 75% of 13- to 34-year-olds across more than two dozen countries actively using the app, Snapchat sees AI as a way to deepen engagement and discovery (Silicon Republic).

For Perplexity, this deal not only expands its audience but also strengthens its position amid growing competition in the AI search space. The company claims to handle more than 150 million questions weekly and recently entered a multi-year partnership with Getty Images to display licensed visual content through its AI tools. However, Perplexity has faced controversy over alleged content scraping practices, including a lawsuit filed by Amazon accusing it of “computer fraud” related to its AI browsing agent, Comet (Silicon Republic).

Despite the scrutiny, Perplexity’s CEO Aravind Srinivas remains optimistic, framing the Snap partnership as a natural step toward the company’s mission of “supporting the world’s curiosity.” Snap CEO Evan Spiegel echoed this sentiment, describing the deal as part of a broader vision to enhance connection and discovery through responsible AI integration. If successful, this collaboration could redefine how social platforms weave AI into everyday communication, turning curiosity into conversation, right inside the Snapchat inbox.

This article was written by the Covertly.AI team. Covertly.AI is a secure, anonymous AI chat that protects your privacy. Connect to advanced AI models without tracking, logging, or exposure of your data. Whether you’re an individual who values privacy or a business seeking enterprise-grade data protection, Covertly.AI helps you stay secure and anonymous when using AI. With Covertly.AI, you get seamless access to all popular large language models - without compromising your identity or data privacy.

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Works Cited

TechCrunch. “Perplexity to Pay Snap $400M to Power Search in Snapchat.” TechCrunch, 6 Nov. 2025, https://techcrunch.com/2025/11/06/perplexity-to-pay-snap-400m-to-power-search-in-snapchat/.

Yahoo Finance. “Perplexity to Pay Snap $400M to Power Search in Snapchat.” Yahoo Finance, 6 Nov. 2025, https://finance.yahoo.com/news/perplexity-pay-snap-400m-power-113313416.html.

Silicon Republic. “Perplexity, Snap Ink $400M Deal to Pump More AI into Snapchat.” Silicon Republic, 6 Nov. 2025, https://www.siliconrepublic.com/business/perplexity-snap-snapchat-400m-conversational-ai-chat-social-media.

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