A major deal reshaping the social media and AI landscape has been announced, with AI startup Perplexity agreeing to pay Snap Inc. (parent company of Snapchat) $400 million to embed its conversational search engine directly into the Snapchat app. The landmark agreement, a mix of cash and equity paid out over one year, was revealed during Snap’s better-than-expected Third Quarter (Q3) 2025 earnings report. The integration is expected to begin in early 2026, with revenue flowing into Snap starting next year.
The Perplexity Snapchat $400 Million deal is a huge win for both companies. For Perplexity, it instantly gains access to Snapchat’s vast global user base of nearly one billion monthly active users, allowing it to scale its product dramatically among a crucial, younger demographic. As Perplexity CEO Aravind Srinivas stated, the partnership allows them to serve curiosity directly where it occurs—within the messaging environment.
For Snap, the partnership is a strategic move to boost user engagement and retention, helping it compete more effectively against rivals like TikTok and Meta. The integration will allow users to ask questions and receive clear, conversational answers drawn from verifiable sources without having to leave the chat interface. Snap CEO Evan Spiegel hinted that this is just the first step in positioning Snapchat as a major platform for external AI partners.
The Perplexity Snapchat $400 Million agreement ensures that the integration is focused on providing a clean, utility-driven user experience. Snap has confirmed it will not be selling advertising against the Perplexity responses, underscoring a commitment to making AI “more personal, social, and fun,” as the company looks to redefine the role of AI within social communication.
