Apple Inc. has initiated internal conversations about possibly acquiring artificial intelligence startup Perplexity AI as part of its strategic push to bolster AI capabilities, according to Bloomberg. These discussions involve Adrian Perica, Apple’s head of mergers and acquisitions, alongside Eddy Cue, the company’s services chief, and key AI leaders within Apple, sources familiar with the matter revealed. However, the talks are in the preliminary stages and may not culminate in a formal offer, the sources cautioned.
Per Bloomberg, this potential move aligns with Apple’s ambition to develop its own AI-driven search engine, a priority that has gained urgency amid threats to its lucrative default search agreement with Google. That partnership, which has historically made Google the default search provider on Apple devices, reportedly generates approximately $20 billion annually for Apple but is now under scrutiny by U.S. antitrust regulators.
As of now, Apple has not initiated any direct acquisition discussions with Perplexity AI’s management, Bloomberg notes. The AI startup confirmed it is unaware of any ongoing or prospective merger and acquisition talks involving its company. Apple declined to comment on the report.
Earlier reports from Bloomberg indicated that Meta Platforms Inc. pursued acquisition talks with Perplexity earlier this year but ultimately did not reach an agreement. Following the breakdown of negotiations, Meta invested heavily in Scale AI, acquiring a 49% stake valued at $14.3 billion, as part of its broader strategy to assemble a leading AI research team.
Perplexity AI’s technology focuses on delivering real-time answers by accessing up-to-date web information, a capability that could significantly advance Apple’s efforts in AI-driven search functionality. Any acquisition move by Apple is expected to be timed carefully, likely contingent on the outcome of ongoing antitrust proceedings involving Google, which will determine whether Apple must alter or terminate its existing search deal.
Bloomberg reports that news of Apple’s interest in Perplexity prompted a market reaction, with Google shares slipping nearly 1% in late trading.
Perplexity recently closed a funding round that valued the company at approximately $14 billion, which would make any acquisition by Apple its largest to date. For context, Apple’s most significant purchase was the $3 billion acquisition of Beats in 2014, although it has made several other billion-dollar deals in recent years, including buying Intel’s modem division and investing in Chinese ride-hailing company DiDi.
The competition for AI talent remains intense between Apple and Meta. Meta is reportedly in advanced talks to recruit Daniel Gross, co-founder of Safe Superintelligence Inc., an AI startup. Apple has also shown interest in Gross, who previously sold his company Cue to Apple in 2013. That acquisition laid the groundwork for early AI features in Apple’s iOS. Notably, Robby Walker, a Cue co-founder, led the Siri voice assistant team until recently and now heads Apple’s Knowledge project, which aims to develop an AI rival to OpenAI’s ChatGPT capable of utilizing open web data.
