India's AI Boom: Firms Sacrifice Revenue for User Growth Amidst Winding Down Promos

• India became the world's largest market for generative AI app downloads in 2025, surpassing the US with a 207% year-on-year surge.
• Despite high adoption, India generated only about 1% of in-app purchase revenue, highlighting monetization challenges.
• Promotional offers from companies like OpenAI and Perplexity AI are now being scaled back, testing user conversion to paid subscriptions.
• AI app in-app purchase revenue in India declined in late 2025, with ChatGPT's revenue falling sharply after aggressive pricing.
• India's vast digital ecosystem and large user base present a significant AI opportunity, but firms face pressure to convert growth into sustainable revenue.