The Mechanics of the Growth Experiment

In July 2025, Perplexity partnered with Airtel, India’s second-largest telecom operator, to offer a free 12-month Perplexity Pro subscription (valued at ~$200) to its 360 million customers. This strategy was designed to rapidly capture market share in India, a region known for massive user scale but significant monetization challenges. The impact was immediate: Perplexity recorded 5.9 million downloads in July 2025 alone—a 625% increase over the previous month—and accumulated 56 million downloads over the seven-month promotional period.

Post-Promotion Retention and Revenue

As the promotional window closed in January 2026, new downloads dropped by over 90%. However, the user base proved resilient. Monthly active users (MAUs), which peaked at 22 million in October 2025, stabilized at approximately 14 million by July 2026—more than five times the average from the first half of 2025.

Crucially, revenue metrics have shown positive trends despite the decline in new acquisitions. Perplexity’s monthly net mobile revenue in India grew from ~$34,000 in January 2025 to $156,000 by July 2026. Furthermore, daily in-app purchase revenue between mid-July and mid-August 2026 was 27% higher than the average for the first half of 2026. While some of this revenue may stem from users failing to cancel auto-renewing subscriptions, the data suggests that a segment of the user base has successfully transitioned from free promotional access to paid usage.

Market Implications for Generative AI

Perplexity’s experiment serves as a bellwether for other AI firms, including OpenAI and Google, which have since launched similar subsidized access programs in India. The core challenge remains whether these companies can convert the massive scale achieved through subsidies into sustainable, long-term revenue. Perplexity’s experience indicates that while the "download boom" is temporary, the promotion effectively established a higher baseline for both active users and recurring revenue, proving that aggressive distribution partnerships can be a viable, albeit costly, strategy for entering price-conscious emerging markets.