NVIDIA is reportedly discussing an investment in AI search startup Perplexity, according to the U.S. tech publication The Information, which reported on the 23rd local time, citing sources familiar with the talks.
In this funding round, Perplexity is expected to be valued at more than $30 billion, or about 42 trillion won. A technology licensing deal is also reportedly being considered alongside a simple equity investment.
Perplexity became known as an AI search service that answers questions by searching the web and organizing responses with sources. Often described as a rival to Google Search, it has grown rapidly and was valued at about $20 billion in its previous round. If $30 billion becomes reality, its valuation would jump by more than 50%.
Its growth has driven the valuation higher. Annual recurring revenue, or ARR, which annualizes monthly subscription income, was under $250 million at the beginning of the year, but has recently surpassed $750 million. That is roughly a threefold increase in a little over six months.
The product behind that growth is the AI agent “Perplexity Comet.” Rather than stopping at search answers, it handles tasks people do on a computer, from research to document writing. As the search company expands into task delegation, its revenue model is seen as becoming more subscription-based and more robust.
This is not NVIDIA’s first startup investment. It has previously invested in Perplexity, and recent reports said it has also been in talks to invest in, or acquire, Korean AI chip startup Rebellions.
At the end of last year, NVIDIA also joined forces with U.S. inference chip company Groq. It is a move to reinvest the cash earned from AI chip sales back into the broader AI services and semiconductor ecosystem.
Markets offer different interpretations. One view is that NVIDIA is pursuing a strategy of expanding the overall market by nurturing service companies that generate chip demand, such as search and agent products. On the other hand, critics argue that companies NVIDIA invests in may use that money to buy NVIDIA chips again, inflating the AI investment boom.
As the bubble debate intensifies, NVIDIA’s investment list has become one of the first things the market examines. Negotiations are ongoing and terms could change. NVIDIA and Perplexity have not commented on the report. If the investment is confirmed, Perplexity, which is challenging Google’s long-dominant search market, would gain both funding and semiconductor firepower, likely affecting the competitive landscape in AI search.