Perplexity to Pay Snap $400M to Power Search in Snapchat

Why It Matters

The integration provides Snap with a differentiated AI search capability that can boost user engagement and open a new revenue stream, while Perplexity gains massive distribution to accelerate its growth in the competitive generative‑AI market.

Summary

Snap announced a $400 million cash‑and‑equity deal with Perplexity to embed the startup’s AI search engine into Snapchat’s My AI chatbot, giving Perplexity access to Snap’s 940 million‑plus user base. The feature is slated for rollout early next year, with Snap beginning to recognize revenue from the partnership in 2026. The announcement coincided with Snap’s Q3 2025 results, which showed revenue of $1.51 billion, a 10% year‑over‑year increase, and a narrowed loss of $104 million. Snapchat+ now counts over 17 million subscribers.