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Snap has ended its proposed $400 million partnership with AI startup Perplexity. The high-profile generative AI collaboration comes to an end even before a wider rollout could begin.
The company confirmed the development in its first-quarter earnings report, stating that both firms had ‘amicably ended the relationship’ during Q1. The deal was expected to integrate Perplexity’s AI-powered search tools into Snapchat’s chat experience.
Snap and Perplexity had announced the partnership in late 2025 as part of a broader push to bring conversational AI features to social media platforms. Under the agreement, Perplexity was set to pay Snap $400 million in cash and equity over a year.
The integration entered limited testing earlier this year. Snapchat users in select markets reportedly gained access to AI-based search responses inside chats. The feature aimed to help users discover information without leaving the app.
However, the companies did not move toward a broader launch.
Snap said its future revenue guidance no longer includes any contribution from the Perplexity agreement. Reports suggest the partnership ended because both companies could not align on long-term product direction and rollout plans.
Neither company publicly disclosed further details about the decision.
The move reflects the fast-changing nature of AI partnerships, where companies continue to reassess strategies amid rising competition and rapid product development.
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Despite the setback, Snap continues to invest heavily in artificial intelligence and augmented reality features. The company has been expanding AI tools across Snapchat, including chatbot functions, creator tools, and AR experiences.
Snap also reported 483 million daily active users globally for the quarter, marking a 5% year-on-year increase.
Perplexity, meanwhile, remains one of the most closely watched AI startups in the search space as competition intensifies among firms building conversational search products.
