AI search startup Perplexity has stopped its advertising business, the Financial Times reported on Feb. 18.

The move runs counter to a trend among rivals to adopt advertising as a monetisation strategy.

Perplexity introduced advertising in 2024, the first among generative AI companies to do so. It tested showing sponsored responses beneath chatbot answers. It began scaling back advertising in stages from late last year. This week, Perplexity executives said they would no longer pursue advertising, the FT reported.

Perplexity executives said, "Users have to believe the answer is the best for them to keep using the product and become willing to pay." Perplexity stated that advertising does not affect chatbot answers, but said, "If there are ads, users start to doubt everything," and concluded the advertising model offered little benefit.

OpenAI has recently begun testing advertising for free ChatGPT users. Google introduced advertising to its AI Mode and AI Overview features. Anthropic has officially declared it will not put ads in its AI chatbot Claude.

Perplexity is currently valued at $18 billion, and its annualised revenue is said to be $200 million. Its user base has surpassed 100 million. Perplexity offers paid subscriptions ranging from $20 to $200 a month, and also provides a free service.

Perplexity said, "We are in the accuracy business. Providing truth and correct answers is the essence of the business," adding, "Advertising does not match what users want, so it may not be necessary going forward."