If you opened Character.AI this week and wondered whether it is about to disappear, here is the short answer. No, it is not shutting down today: the company filed for Chapter 11 bankruptcy on 12 October 2026 to sell its assets, and the app is still running. Whether it carries on afterwards depends on who ends up with it.
We build a competing app (Aisha), so we are not neutral here, and we are not cheering. A lot of people have real conversations and characters on that platform. This page sticks to what has been reported, says where nobody knows yet, and gets practical about your chats.
What happened
Character Technologies Inc., the company behind Character.AI, filed a voluntary Chapter 11 petition on 12 October 2026 in the US Bankruptcy Court for the District of Delaware (case 26-11603). The stated aim is a court-supervised sale of all or substantially all of its assets. Court papers list its assets and liabilities each at between $50 million and $100 million.
Before filing, the company lined up Disney as the opening bidder, known as a "stalking horse". Disney's affiliate would pay $20 million for a non-exclusive, perpetual licence to selected intellectual property and certain claims, and former Character.AI staff now at Disney would provide transition services. The $20 million is a floor. Other bidders can offer more.
The company expects the sale to complete in late November or early December 2026. Some background that has been reported: Disney sent Character.AI a cease-and-desist letter last year over bots based on Disney characters, and the company removed them. The company also faces state actions, including from Kentucky and Pennsylvania, and has said it hopes the bankruptcy can help resolve those claims.
Is the app still working?
Yes. Character.AI has said the platform remains up and running, and that paid subscriptions continue with unchanged billing, with subscribers told in advance if paid features change.
From here, two broad outcomes are possible:
- A buyer keeps the platform running. Disney's bid is for a licence to selected assets, not an announcement that it will run the app, so who operates it afterwards is not settled.
- No buyer wants the platform. The company has said it will be wound down in that case.
Anything more specific, like which features survive, would be guesswork, so we are not going to guess.
What happens to your chats and characters
This is the part nobody can answer yet. Character.AI says user data continues to be protected under its privacy policy, but that policy allows information to be shared in a sale of company assets, and the company has not said whether chat histories are part of what is being sold. It also has not said what happens to user data if the platform closes without a buyer.
So the safe move is to save what matters before the sale closes:
- Copy or screenshot the conversations you would hate to lose. A long roleplay, a story you built, a conversation that meant something to you.
- Write down your character descriptions. If you made characters, copy the name, greeting, personality and example lines into a document of your own. That is often enough to rebuild a character elsewhere.
- Check your settings for a data download. Reporting says users can download their data through the app or website. Look in your account settings.
- Know your rights. Depending on where you live, laws like GDPR in Europe and the UK or CCPA in California may let you ask a company for a copy of your data or to delete it. A privacy request to the company is worth considering if that applies to you.
- Do not panic-delete. Deleting your account may not erase everything, since the policy lets the company keep some information, and public characters may stay up after you delete. Export first, decide later.
Where people are going
Nobody has to move today. But if you want a plan B ready, the options split by what you liked about Character.AI.
If you loved making and meeting lots of characters, look at platforms built around that. Kindroid lets you build your own custom character with chat, selfies and voice. Nomi focuses on memory and lets you create more than one companion. Chai is another place where users build their own characters and stories. Our full Character.AI alternatives comparison goes through five apps, including where each one beats us.
If what you loved was one ongoing relationship, that is what Aisha is for. She is a single companion, not a character platform. She has her own life, with her own people and things going on that move forward over days, and she brings them up. She remembers you and follows up days later on things that mattered. The choices you make stick, so they change her life and your life with her. She also sends voice notes, you can call her, watch shows and films together, play games, and get selfies and photos from her. She chats in English, Hinglish or Hindi, matching how you text.
The trade-off is real: Aisha is one companion, with no user-made characters and no store app. She lives in your browser and on Telegram.
Try one before you need one
If you want to see whether a single, remembering companion suits you, you can start a free chat with Aisha in your browser or on Telegram, with nothing to install. Free chat is limited, then you pick a plan if you want more.
This story is moving quickly, and details may change as the sale goes through. If you spot something out of date or wrong, tell us at support@justaisha.com and we will fix it.