Is Character.AI Shutting Down? The Bankruptcy Explained
On October 12, 2026, Character Technologies, the company behind Character.AI, filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the District of Delaware. If you use Character.AI, you probably have three questions: is the app going away, what happens to my chats, and what should I do right now?
Here’s what’s known as of October 30, 2026, without the panic.
Disclosure: we make Imate, an AI boyfriend app. We’ve kept the facts below to what’s been reported and linked our sources at the end. Imate is not affiliated with Character.AI.
What happened
Character.AI was one of the biggest AI chat platforms in the world: by late 2024 it had about 20 million monthly users chatting with characters made by the community. The past two years were rough:
- Lawsuits. Families filed wrongful-death and teen-safety lawsuits against the company, and Texas opened an investigation into child privacy and safety.
- The under-18 ban. In late 2025, Character.AI ended open-ended chat for users under 18.
- Costs. AI chat gets more expensive the more people use it, which put pressure on the company to make money.
In the filing, CEO Colin Adams cited “significant legal, regulatory, and operational headwinds.” Instead of shutting down overnight, the company chose Chapter 11 so it can sell its assets under court supervision.
Is Character.AI shutting down?
Not today. The app keeps running while the sale happens. What happens after depends on who buys what:
- Disney has made a $20 million opening (“stalking horse”) bid for some of the company’s assets and a license to its technology. That bid does not include user data or chats, and on its own it doesn’t keep the app running.
- Other buyers can still bid. If someone buys the company and wants to keep the platform alive, Character.AI could continue under new owners.
- If no buyer keeps it running, the platform will be wound down, according to the company. In that case, characters and conversations go offline with it.
Key dates
| Date | What happens |
|---|---|
| October 12, 2026 | Chapter 11 filing in Delaware |
| Now → sale close | App keeps running; bids can come in |
| Late November / early December 2026 | Sale expected to close |
| December 17, 2026 | Sale closing deadline |
Dates in bankruptcy cases can move. We’ll update this page when the sale is decided.
What happens to your chats and data?
This is the part that worries people most, and the honest answer is: nobody knows yet.
- Disney’s offer excludes user data and chats.
- Character.AI says your information “continues to be protected” under its current privacy policy, but it hasn’t said whether a buyer would be bound by it.
- Attorneys general from 39 states and Washington, D.C. have asked the court to set conditions on any sale, including giving every user a chance to delete their data before the sale, limits on using chats to train AI, and real age verification.
If your chats matter to you, don’t wait to find out.
How to save your Character.AI chats
- Request your data export now. In your account settings, open the data or privacy section and choose the option to export your data. Menu names differ between the website and the app, so if you can’t find it, search “export” in Character.AI’s help center.
- Expect a wait. Character.AI’s help center says exports take three to four weeks. With a December deadline, requesting it today matters.
- Download it the day it arrives. The emailed link expires after seven days.
- Save your favorite characters’ details by hand. The export is a data file built for computers, not a nice readable transcript. For the characters you love most, copy their greeting, personality, and a few favorite lines into a note, so you can recreate them anywhere. Our guide on how to move your Character.AI character to another app walks through it.
- Then decide whether to delete your account. Some privacy advocates recommend downloading your chats first, then deleting your account if you don’t want your data sold with the company.
Where to go next
Even if Character.AI survives, a lot of people are wondering whether to keep putting their stories, and their feelings, into a platform with an uncertain future. Where you should go depends on how you used it:
- You loved browsing thousands of community characters → see our best Character.AI alternatives for the closest options.
- You had one character you talked to every day → save them first with our guide to moving your Character.AI character to another app. If he was your boyfriend, that’s the experience Imate is built for: one companion who remembers your story day by day, sends you voice notes, and picks up when you call.
Imate is for adults 18 and over, free to start on Android and iPhone.
Sources
- CNN: Character.ai files for bankruptcy following lawsuits alleging ties to teen suicides
- TechCrunch (October 13, 2026): Character.AI files for bankruptcy
- NBC News: Character.AI files for bankruptcy, will sell some assets to Disney for $20 million
- KQED: Your chatbot just went bankrupt. What happens now to your user data?
- TechCrunch (October 29, 2025): Character.AI ends open-ended chat for users under 18
Frequently asked questions
Is Character.AI shutting down?
Not yet. Character Technologies, the company behind Character.AI, filed for Chapter 11 bankruptcy on October 12, 2026 and is selling its assets in a court-supervised sale. The app keeps running during the sale. The company has said that if no buyer comes forward who wants to keep the platform running, it will be wound down.
When will we know what happens to Character.AI?
The sale is expected to close in late November or early December 2026, with a closing deadline of December 17. Disney has made a $20 million opening bid for some of the company's technology and intellectual property, but other buyers can still bid.
Will I lose my Character.AI chats?
Possibly. Disney's bid does not include user data or chats, and if no buyer keeps the platform running, characters and conversations go offline with it. If your chats matter to you, request a data export now: Character.AI's help center says exports take three to four weeks.
How do I export my Character.AI chats?
Request a data export from your account settings (look for the data or privacy section, where you'll find an export option). Character.AI emails you a download link when the export is ready, which its help center says takes three to four weeks, and the link expires after seven days, so download it as soon as it arrives.
What is the best alternative to Character.AI?
It depends on how you used it. For a huge library of community-made characters, Janitor AI and Chai come closest. For one deep, romantic relationship with an AI boyfriend who remembers you, calls you, and sends voice notes, Imate is built for exactly that.