Market & Regulation

Snap and Perplexity End $400M AI Deal

TechCrunch AIMay 6, 2026high confidence

Why it matters

→The termination of the deal highlights challenges in AI integration partnerships.
→Snap's growth in users suggests resilience despite the deal's collapse.
→The decision impacts Snap's long-term AI strategy and revenue projections.

Snap and Perplexity End $400M AI Deal — ©TechCrunch AI

Snap and Perplexity have amicably ended their $400 million deal, which was set to integrate Perplexity's AI search engine into Snapchat. The decision was revealed in Snap's quarterly earnings report, noting that the companies couldn't agree on a broader rollout plan. Initially, the partnership was expected to contribute to Snap's revenue by 2026. Despite this setback, Snap reported a 5% increase in both daily and monthly active users, attributing growth to new app features.

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