AI Companion App Market Growth: Revenue, Trends & Forecasts (2025–2030)

AI companion apps drew an estimated $82 million in app-store consumer spending in the first half of 2025, and Appfigures projected more than $120 million for the full year, as TechCrunch reported. For the first half of 2026, Appfigures reported about $327.6 million across two new categories. Those categories use a different classification, so the jump isn’t a growth rate.

Published forecasts, meanwhile, put the “AI companion market” anywhere from $4 billion to $37 billion. No single number describes this market. Tracker spending, company run rates, and analyst models each measure something different, and none of them shows profit.

This report explains what each figure measures. It also covers where the money goes, what Character.AI’s bankruptcy shows about the economics, and which laws come next.

How to Read AI Companion Market Numbers

Four kinds of figures share the “AI companion market” label:

1. Gross app-store spending: what users pay through Apple and Google before store fees. Appfigures and Sensor Tower estimate it. It excludes web payments and ad income.
2. Developer revenue: what the operator keeps across all channels. Few companion firms publish it.
3. Annualized run rate: a current monthly rate multiplied by twelve. It isn’t revenue already earned.
4. Analyst market size: a modeled estimate whose scope may include enterprise, wellness or services.

This article relies on Appfigures’ published categories rather than reclassifying apps itself. None of these four measures shows profitability, and they shouldn’t be added or divided across types.

AI Companion App Statistics at a Glance

How Big Was the AI Companion App Market in 2025?

Dedicated companion apps were on track for more than $120 million in app-store spending in 2025. Appfigures counted 337 active apps that generated spending, 128 of them launched that year. First-half downloads reached 60 million, a count of installs rather than unique people.

Appfigures defines a companion app as one built around premade or user-generated synthetic characters with personalities. Replika, Character.AI, PolyBuzz and Chai fit that definition. ChatGPT doesn’t.

Did AI Companion Spending Keep Growing in 2026?

Appfigures’ H1 2026 data splits the category in two:

• Romantic and NSFW apps: 214 apps, $162.8 million in spending
• General “PG” apps: $164.8 million, with nearly twice the downloads

The 2026 apps were sorted by store metadata, age ratings, and romance- or adult-related terms. The rise from $82 million reflects an unknown mix of real growth and wider scope.

The category edges are also blurry. ChatBox: AI Chat Bot Assistant, an assistant-style app, ranked third among romantic/NSFW apps at $13 million. If it’s misclassified, the romantic total would fall to about $149.8 million and the combined figure to about $314.6 million. That’s an illustration of the uncertainty, not a corrected estimate.

Sensor Tower’s Q1 2026 data points the same way: companion in-app revenue rose about 30% quarter over quarter, the fastest of any generative AI sub-segment.

AI Companion Market Forecasts Compared

Research firms disagree by an order of magnitude because they define the market differently.

The Business Research Company alone publishes two figures, $4.24 billion and $18.35 billion, because it uses two definitions. All four forecasts sit behind paid reports, so their full methods aren’t public. Averaging them would be meaningless. None of them can project app-store spending inside Zeta or Replika.

How AI Companion Apps Make Money

Most companion apps earn through subscriptions and one-off in-app purchases. Some, like Character.AI, also sell ads. Web-only platforms such as Candy AI, SpicyChat and Joi AI bill outside the app stores, so trackers miss them entirely.

Spending and downloads often diverge. In H1 2026, Emochi led romantic apps with 7.9 million installs to Zeta’s 3 million, yet Zeta drew more than four times Emochi’s spending. That points to a monetization gap. Without paid-conversion, retention, and payer-spend data, the reason remains unknown.

Revenue per download rose from $0.52 in 2024 to $1.18 in 2025, averaged across all installs.

Higher spending per download doesn’t guarantee better margins. An app can monetize aggressively and still lose money if its heaviest users cost too much to serve.

Who Earns the Money in AI Companion Apps?

In Appfigures’ 2025 data, the top 10% of companion apps took 89% of spending, and only about 33 apps had passed $1 million in lifetime spending.

In 2025, 17% of active apps had “girlfriend” in the name, against 4% for “boyfriend” or “fantasy.” Naming isn’t demand, though. Crushie AI, a female-focused “AI boyfriend” app, ranked fourth in H1 2026.

Chai: Company-Reported Revenue Run Rate

Chai reported closing 2025 at $58 million in ARR. On its own site, it says it reached $85 million in annualized revenue in April 2026, with positive gross margins. Positive gross margins aren’t the same as operating profit, and none of these figures are audited.

Are AI Companion Apps Profitable?

Public evidence is thin, and the clearest case is a failure.

Character Technologies filed for Chapter 11 in Delaware late on October 12, 2026, to sell its assets through the court. Disney is the stalking-horse bidder at $20 million for a non-exclusive, perpetual license to certain IP and claims. Higher offers can still win. Character.AI says it will wind the service down only if no buyer keeps it running.

Character.AI’s Costs Against Its Revenue

The figures below come from 404 Media’s review of the filing:

Average 2026 compute alone exceeded the best month of total revenue. The operating loss also reflects payroll, legal, and safety costs, so it isn’t revenue minus compute. Ads made up about 47% of revenue by August 2026.

Compute wasn’t the only strain. The CEO’s filing cites the cost of age restrictions, harm detection, and litigation. Character.AI reached preliminary settlements with five families in January 2026. By September, Disney had hired most of its employees, per Reuters.

The sale now faces regulators too. On October 14, 40 state attorneys general filed a notice asking the court to protect children’s data and private conversations in any sale. They reserved the right to object.

Chai’s reported positive gross margins offer a contrast, but they’re unaudited. One bankruptcy doesn’t make the category unprofitable. It does show that audience size says little about margins.

What Regulation Applies to AI Companion Apps?

SB 243 took effect in California on January 1, 2026, requiring AI disclosure, crisis referrals, and safeguards for minors.

SB 1119 (Adam’s Law) was signed on September 10, 2026. Under the enacted bill text, most duties apply from July 1, 2027. Akin Gump’s summary lists these for operators that allow child users:

• Default parental controls disabling persistent memory and push notifications
• One-hour session and two-hour daily caps
• Crisis protocols linked to a parent account or the 988 line
• Limits on child-targeted ads and data use
• Independent child-safety audits from January 1, 2029

Operators under $500 million in prior-year gross revenue are exempt from the audit duty until 2032, but not from the other duties. Operators must determine each user’s age or apply the protections to everyone. Under specified conditions, a harmed child, or a parent acting for one, can sue.

Federally, the FTC sent 6(b) orders to seven companies in September 2025, including Character Technologies. The orders open a study, not an enforcement action.

How SB 1119 Could Affect Companion Businesses

This is analysis, not a statutory requirement. Memory, notifications, and long sessions drive engagement in many companion apps, and SB 1119 limits all three by default for covered child users. Persistent memory sits at the center of how AI companion customization works, so child-facing products may need real redesign. The revenue effect will depend on each operator’s user base.

AI Companion Market Indicators to Watch

• A consistent full-year Appfigures cut: one definition across both years
• Web revenue disclosures: from platforms that bill outside the app stores
• Compute cost per active user: whether cheaper inference narrows the gap
• Paid conversion and retention: whether downloads turn into lasting spending
• The Character.AI sale and the states’ conditions: both still open in court
• SB 1119 product changes: ahead of July 2027

The leading AI companion apps behind these totals span both the PG and adult segments.

Where the AI Companion Market Stands

AI companion apps are a real, growing paid category, worth hundreds of millions a year in app-store spending alone. Broader forecasts reach the billions only by widening the definition. Profitability remains the open question. Character.AI showed how inference, safety, and legal costs can outrun revenue.

FAQs

Q. How big is the AI companion app market in 2025?

The AI companion app market was projected to generate over $120 million in app-store consumer spending in 2025, according to Appfigures. Broader market research estimates range from $4.24 billion to $36.8 billion, depending on whether they include wellness platforms, AI services, and other companion technologies. These figures measure different markets and aren’t directly comparable.

Q. Why do AI companion app market forecasts vary so much?

AI companion market forecasts differ because research firms use different market definitions and revenue models. Some measure dedicated companion apps, while others include AI wellness tools, virtual assistants, customer support, and related services. For example, The Business Research Company published separate 2025 estimates of $4.24 billion and $18.35 billion based on different market scopes.

Q. How fast is the AI companion app market growing?

The AI companion app market recorded 64% year-over-year growth in consumer spending and 88% growth in downloads during the first half of 2025, according to Appfigures. Sensor Tower reported approximately 30% quarter-over-quarter revenue growth in Q1 2026. However, changes in app classifications prevent a reliable direct growth comparison between the two years.

Q. Which AI companion app generated the most revenue in 2026?

Zeta led the romantic AI companion app category in H1 2026, generating an estimated $33 million in gross consumer spending. Other leading apps included Tipsy Chat, ChatBox, Crushie AI, and Emochi. Separately, Chai reported an $85 million annualized revenue run rate in April 2026, which is not directly comparable to six-month app-store spending.

Q. Are AI companion apps profitable?

AI companion apps can generate substantial revenue, but profitability varies significantly. Character.AI reported operating losses of approximately $8–9 million per month in August 2026, with computing expenses exceeding revenue. In contrast, Chai reported positive gross margins in April 2026. However, positive gross margins do not necessarily mean a company is profitable overall.

Q. Did Character.AI file for bankruptcy in 2026?

Yes. Character.AI’s parent company, Character Technologies, filed for Chapter 11 bankruptcy in October 2026. Court filings revealed significant computing costs, operating losses, and financial pressure. Disney emerged as the initial bidder for a $20 million non-exclusive intellectual property license, while state attorneys general raised concerns about protecting children’s data during the sale.

Q. What regulations apply to AI companion apps in 2026?

AI companion apps face increasing regulation, particularly concerning child safety and user privacy. California’s SB 243 took effect in January 2026, introducing chatbot disclosure and safety requirements. SB 1119 adds further protections beginning in July 2027, including parental controls, usage limits, and restrictions on children’s data. The FTC is also studying chatbot safety practices.

Q. Is ChatGPT considered an AI companion app?

ChatGPT is not classified as a dedicated AI companion app under Appfigures’ market definition. Dedicated companion apps, such as Replika, Character.AI, and Chai, primarily offer interactions with AI-generated personalities or virtual characters. Although people may use ChatGPT for companionship, its broader general-purpose functionality places it outside these specific market spending estimates.

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