- Adoption Is Slow: Marketers are intrigued by Perplexity’s ad potential but frustrated by its limited availability and lack of lower-funnel tools.
- Scale Is the Barrier: With only 22M users, Perplexity can’t yet compete with Google or ChatGPT for ad dollars.
- ROI Still Unclear: Buyers cite brand safety, measurement, and CPM inefficiencies as reasons for hesitation.
- Ad Platform Still Early: Executives confirm the product is in its infancy—more conceptual than commercial.
- Growth Depends on Performance Ads: Without direct response options, Perplexity risks losing momentum with advertisers seeking results, not just awareness.
Six months after launching its advertising business, Perplexity AI has captured the curiosity of marketers—but not yet their confidence.
Despite a roster of well-known early testers like Whole Foods, Indeed, and PMG, the AI-powered search engine's ad offerings remain in limited pilot stages, leaving advertisers wanting more than just potential.
The early buzz surrounding Perplexity's subtle sponsored placements has yet to materialize into a scalable, performance-driven ecosystem. And in an ad market dominated by metrics and efficiency, that's becoming a problem.
Early Interest, Limited Inventory
When Perplexity unveiled its advertising initiative in November 2024, it promised to reimagine how brands engage users within AI-powered search. Early partners were eager to test the waters, intrigued by the idea of embedding sponsored responses seamlessly alongside AI-generated answers. Yet six months in, those opportunities remain confined to a select group.
Advertisers who spoke to Digiday expressed a shared frustration: limited inventory, slow rollout of features, and a lack of meaningful data on return-on-investment. Even Perplexity's Merchant Program—a commission-free option aimed at helping retailers surface their products in AI-powered shopping recommendations—has been slow to scale.
“We’re in talks with Perplexity about their Merchant Program, and they’ve earmarked one of our larger clients for testing opportunities, but progress has been slow,” one anonymous ad exec shared in a conversation with Digiday.
Check out the Perplexity AI’s Deep Research Tool: Free, Fast, and a Game-Changer for In-Depth Analysis
The Scale Problem
Perhaps the most glaring challenge facing Perplexity is one of reach. With roughly 22 million active users across its website and app, the platform remains a small player in a field dominated by giants. For comparison, ChatGPT reportedly boasts over 400 million users, and Google's AI Overviews reach more than 1.5 billion people monthly.
The lack of scale puts Perplexity at a disadvantage, particularly in a cautious ad market where marketers are under pressure to justify every dollar spent. Without a large, addressable audience, advertisers see the platform as little more than a brand awareness tool—not a serious contender for lower-funnel, conversion-driven campaigns.
“Our hesitation stems from a few key concerns: limited scale, lack of demonstrated ROI, brand safety considerations, and CPM efficiency,” said Ryan Bopp, SVP of digital strategy at Eden Collective.
Platform Positioning: Awareness Over Action
According to Perplexity's leadership, the platform isn’t trying to be the next programmatic workhorse—at least not yet. In recent public comments, executives, including Chief Business Officer Dmitry Shevelenko and Head of Advertising and Shopping Taz Patel have emphasized that the ad platform is in its "product-driven" early stages.
“We’re not trying to say we have a programmatic or bidding ad system. We’re trying to redefine this and do it from scratch,” Patel said during Luma Partners’ DMS event.
That future-facing vision is appealing in theory, but in practice, it has left media buyers with more questions than answers. Without a fully-formed ad platform—complete with robust targeting, analytics, and scalable inventory—Perplexity remains a curiosity rather than a cornerstone.
“I was impressed with how he described the agentic future, but overall the way he talked about Perplexity’s work in advertising still seemed very early and conceptual,” another ad exec stated.
Financial Pressure Mounts
Perplexity may need to accelerate its advertising ambitions if it hopes to sustain its rapid growth. According to The Information, the company generated $34 million in revenue in 2024 but burned through $65 million in the same year, primarily on cloud infrastructure and model training.
Despite raising a reported $500 million at a $14 billion valuation, this marks the company’s fifth funding round in under two years. Ad revenue could provide the kind of steady income needed to stabilize operations and support a long-term product roadmap.
“Whoever displaces Google will do exactly what Perplexity is doing right now: constantly experimenting, with a relentless focus on the user experience,” said Shevelenko. “The businesses who partner with us to explore new ways to serve and engage their customers already get this.”
Still, patience is wearing thin.
What Advertisers Want Next
To move beyond the experimental phase, Perplexity will need to offer more than just brand visibility. Advertisers are looking for:
- Lower-funnel solutions: Opportunities to drive conversions and measurable ROI.
- Better targeting and reporting: Advertisers need tools that go beyond impressions and clicks.
- Improved inventory access: Opening up ad opportunities beyond a small pilot group.
As Robert Kurtz of Basis Technologies put it, "It's our job to position the ad opportunity Perplexity does offer and align it with the expected outcome such as awareness and engagement… But without more lower-funnel options, the pitch has its limits."
A Promising Start, but the Clock Is Ticking
Perplexity may have been first out of the gate with AI-powered search ads, but it now faces the same fundamental question that has plagued every new ad platform: Can it deliver results at scale?
So far, the answer is a tentative maybe. Advertisers are watching. They’re intrigued. But without stronger signals on performance and broader access, Perplexity risks fading into the background of a rapidly maturing AI ad market. It has the vision—now it needs the volume.
