Axios first reported the deal early Friday and said it is valued at roughly $400 million.
Facebook said its planning to further integrate Giphy into the Instagram app "so that people can find just the right way to express themselves." Giphy will continue to operate its library, Facebook said.
Giphy is a library of GIFs that can integrate with other apps. Companies like Slack and Twitter have built Giphy into their apps. Apple also uses some Giphy images for its GIF feature in iMessage. It's unclear if Facebook will end those relationships to keep Giphy only on Facebook's apps. Instagram said in a tweet that third parties will still be allowed to use Giphy images.
"People will still be able to upload GIFs; developers and API partners will continue to have the same access to GIPHY's APIs; and GIPHY's creative community will still be able to create great content," Vishal Shah, vice president of product, said in the news release.
Facebook has long used Giphy's application program interface throughout its main Facebook app, Messenger, Instagram and WhatsApp. Facebook first attempted to acquire Giphy in 2015, two years after it was founded. Giphy at the time reportedly declined the offer in order to pursue partnering with various social media companies and soon after raised $17 million in Series B funding.
Facebook's acquisition of Giphy comes at a time when it is under intense scrutiny from regulators and state attorneys general. Some lawmakers, like Sen. Elizabeth Warren, D-Mass., have called for a ban on large mergers, especially during the economic downturn caused by the coronavirus pandemic. The FTC declined to comment on Facebook's acquisition of Giphy.