Perplexity is stepping away from advertising on its AI search product, betting that an ad free experience will build more trust and drive more paying subscribers.
Quick Summary – TLDR:
- Perplexity has phased out ads and says it has no plans to bring them back right now.
- The company tested sponsored answers in 2024 but executives worried ads would make users doubt results.
- Perplexity is leaning harder into subscriptions, with paid plans aimed at professionals and power users.
- The move stands out as rivals push ads deeper into AI search and chat products.
What Happened?
Perplexity has phased out advertising on its AI search platform after experimenting with sponsored placements in 2024. Company executives said ads can clash with the idea of answers users can trust, even when those placements are clearly labeled.
No ads coming to Perplexity. Not a good sign for ChatGPT -> Perplexity says it has no plans to further pursue ads, which it introduced in 2024, after phasing them out in late 2025 over fears they would erode user trust
— Glenn Gabe (@glenngabe) February 18, 2026
“A user needs to believe this is the best possible answer,… pic.twitter.com/jvoeMCQEhD
Why Perplexity Is Walking Away From Ads?
Perplexity is not just turning off a revenue switch. It is making a statement about what it thinks will win in AI search. According to reporting from the Financial Times, executives at the San Francisco based startup have confirmed that ads have been halted, and there are currently no plans to pursue them further.
The company started phasing out the placements late last year, after trying out a format that put sponsored content beneath chatbot answers. These ads were clearly labeled as “sponsored,” and Perplexity says they were presented in a way that did not affect the AI’s outputs. Still, the company appears to have decided that the visual presence of ads alone creates a credibility problem.
One executive told the Financial Times, “the challenge with ads is that a user would just start doubting everything, which is why we don’t see it as a fruitful thing to focus on right now.” Another executive described Perplexity as being “in the accuracy business,” adding that ads are “misaligned with what users want.”
That is the core issue. In AI search, users are not only judging speed and convenience. They are judging whether the answer feels clean, unbiased, and reliable. Even if ads are separated from responses, executives believe users may still suspect commercial relationships are shaping what they see.
Subscription First, Not Ad Supported Scale
Instead of chasing ad dollars, Perplexity is leaning into subscriptions as its main business engine. The company offers paid tiers ranging from about $20 per month to roughly $200 per month, alongside a free version. Paid plans come with higher usage limits and additional features built for professionals and heavy users.
Perplexity’s view is simple. If the product is truly useful and the answers feel dependable, people will pay. As one executive put it, “A user needs to believe this is the best possible answer, to keep using the product and be willing to pay for it,” according to the Financial Times.
This is also where the bigger strategy shift shows up. Perplexity once suggested advertising could become a massive business for AI search. Now it is betting on a smaller but more valuable audience that is willing to pay for an experience that feels premium and trustworthy.
How This Compares With OpenAI, Google, and Anthropic?
Perplexity’s position looks even sharper when you compare it with the wider market.
Many major players are moving in the opposite direction. OpenAI has begun testing advertisements in ChatGPT for free tier users. Google already runs ads in AI Mode and AI Overviews inside traditional search results, though the company has denied plans to introduce ads into Gemini. Microsoft has also been pushing deeper ad tech integration across its ecosystem as AI costs rise.
Those costs matter. Running large language models is expensive, and advertisers offer a familiar way to subsidize free usage while keeping growth high. Investors also want a clear path to profitability, which makes advertising tempting.
But Perplexity is saying the tradeoff is too risky, at least right now.
Anthropic has taken a similar stance. The company has publicly committed to keeping Claude ad free and recently ran Super Bowl commercials pushing that message. The ads carried the theme “Ads are coming to AI. But not to Claude” and showed chatbot conversations being interrupted by advertising. Anthropic has said ads have “no place” in personal AI chats.
SQ Magazine Takeaway
I think Perplexity is making the right call, even if it leaves money on the table. In AI search, trust is the product. The moment people suspect the answer is nudged by sponsors, the whole experience starts to feel like old search with a new coat of paint. If Perplexity can truly stay focused on accuracy and convince power users to pay, it could carve out a stronger position than rivals chasing ad supported scale.
