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Perplexity will pay Snap $400M to power AI search inside Snapchat, bringing conversational search to millions of users and reshaping how people discover content.
When technology meets ambition, the stakes can reach into the hundreds of millions… and that’s exactly what’s happening with the latest deal between Snap Inc. and Perplexity AI.
In a move that signals AI’s deepening role in everyday apps, Perplexity will pay Snap $400 million in cash and equity to power its search features inside Snapchat. The punchline? One of the world’s largest chat apps is turning over its search engine to an AI specialist, betting big that users will embrace conversational answers and not just keyword hits.
Under the agreement announced just after Snap’s Q3 2025 earnings, Perplexity will integrate its AI search engine directly into Snapchat’s chat interface in “early 2026.”
In exchange for paying Snap $400 million, Perplexity gets access to Snap’s global user base of around 940 million monthly active users. For Snap, this is more than a revenue hit: the company said it expects to begin booking income from the deal in 2026.
Why is this transformative? Because rather than users leaving the app to Google or another browser, Snapchat intends to embed AI-driven answers where the conversation already is, turning casual chats into search moments.
Snap CEO Evan Spiegel framed it as: “Our goal is to make AI more personal, social, and fun — woven into the fabric of your friendships, Snaps, and conversations.
This deal speaks volumes about the evolving battleground of search and AI. Rather than relying on legacy web search, Perplexity is betting that chat-based discovery (inside apps like Snapchat) will be the next frontier. And Snap is placing its chips on becoming a distribution platform for intelligent agents.
At a time when Snap’s own revenue reached $1.51 billion in Q3 (up 10% year-over-year) and its loss narrowed to $104 million from $153 million the prior year, this deal offers a strategic inflection point.
For Snap users, the user-experience shift could be subtle but significant: ask a question in chat, get an answer powered by Perplexity’s engine, stay inside the app, and share the result with friends. For Perplexity, it ramps up its scale and visibility with global exposure to Snap’s audience.
Of course, questions remain: how seamlessly will the integration feel? Will users trust AI answers over traditional search? How will Snap monetize this in the chat-centric world (ads, subscriptions, data?). Still, the headline number — itself eye-catching — monumental.
In short: Snap opens its doors to AI search, Perplexity buys the key, and users may end up with a new kind of conversational search inside one of their favorite apps. The marriage of chat + AI search seems to have officially arrived.
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