Character.ai will shut down if no buyer emerges, capping a fall from $2.7 billion Google deal to bankruptcy
Character.ai has filed for bankruptcy and is looking for a buyer. If none steps up, the platform shuts down. Founded by ex-Google researchers, the company once had over 20 million users but is now battling lawsuits over harm to minors and operational problems. The sale should close by the end of 2026.
Via The Decoder
Oct 13, 2026
AI chat platform Character.ai has filed for bankruptcy and is up for sale. The deal should close by early December 2026. No buyer means the service shuts down. The platform and subscriptions keep running until then. Character.ai blames lawsuits over harm to children, regulatory pressure, and operational problems. One teenager took his own life.
Disney is picking up some assets for $20 million, including a perpetual, non-exclusive technology license. Former Character.ai employees who moved to Disney last…
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