Snap no longer has an agreement with Perplexity, as disclosed on Wednesday in its quarterly earnings report. The partnership, announced last November, was intended to integrate Perplexity’s AI search engine into Snapchat, with Perplexity paying Snap $400 million in cash and equity over a year. Snap stated that they “amicably ended the relationship in Q1” and that their sales guidance “assumes no contribution from Perplexity.” When initially announced in the third-quarter earnings last year, Snap anticipated revenue from the collaboration to start contributing in 2026.
The arrangement aimed to incorporate Perplexity into Snapchat’s “Chat” interface, enabling users to get conversational answers within the app. Although testing was conducted with select users, Snap mentioned in February that no mutual agreement had been reached for a broader rollout.
Snap CEO Evan Spiegel, at the time of the initial announcement, emphasized the deal’s alignment with the company’s AI-driven discovery goals on Snapchat, expressing eagerness to work with more innovative partners.
Perplexity has not yet provided a comment regarding this matter.
On Wednesday, Snap reported a 5% year-over-year increase in Snapchat’s global daily active users (DAU) to 483 million and a 5% rise in monthly active users (MAU) to 965 million, attributing growth to new app features like Snap Map and Lenses AR filters.
“In Q1, we returned to growth in daily active users, accelerated revenue growth, expanded margins, and produced strong free cash flow,” Spiegel stated in a press release. “We remain committed to disciplined execution as we invest in Specs and our long-term potential in intelligent eyewear and look forward to more revelations at AWE on June 16th.”
Snap announced in April plans to cut roughly 16% of its global workforce, affecting around 1,000 full-time employees, citing AI advancements as the reason for reductions.
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