Snap stock tumbles after Perplexity AI deal is cancelled
Updated
Updated · Barron's · May 7
Snap stock tumbles after Perplexity AI deal is cancelled
12 articles · Updated · Barron's · May 7
Shares fell 8% to $5.62 in premarket trading after first-quarter results showed an $89 million loss and revenue rising 12% to $1.53 billion.
The scrapped agreement had envisaged Perplexity paying $400 million to integrate its AI search tools into Snapchat, but both companies said they ended the relationship amicably.
The setback may intensify pressure from activist investor Irenic Capital Management, which has urged layoffs and a closure or spinoff of Snap's Specs unit after last month's 16% job-cut plan.
With its major AI deal gone, how will Snap pivot to appease investors and revive its stock?
Will copyright lawsuits against Perplexity cripple the future of AI-powered search engines?