Nov 6, 2025 - Business

Snap signs $400 million search deal with Perplexity

Dan Primack

Photo illustration of the Wall St. bull statue with cartoon eyes and barfing a rainbow. — Photo illustration: Greg Ruben/Axios

Snap will receive $400 million in cash and equity in Peplexity, as part of an agreement whereby Snap will incorporate Perplexity's AI search engine into Snapchat next year.

Why it matters: For Snap, it's a new business line that it seems eager to replicate. For Perplexity, it's a giant distribution boost. For everyone, it feels like a step toward sponsored AI and, possibly, agentic commerce.

By the numbers: Perplexity most recently was valued by VCs at $20 billion. Snap closed yesterday with a $12.3 billion market cap, although shares jumped 17.5% at today's open.

In addition to the $400 million, Snap will receive a percentage of revenue from the partnership.

Go deeper, via the FT: "The tie-up comes as [Snap] has struggled to expand its advertising business in line with expectations and move to profitability given competition from deep-pocketed rivals such as Meta, which is pouring billions of dollars into developing its own AI models."

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Snap signs $400 million search deal with Perplexity

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