OpenAI dropped $1B/year Cursor deal after Musk's SpaceX bought it

OpenAI reportedly estimated its partnership with AI coding startup Cursor would generate more than $1 billion in annual revenue. OpenAI still walked away from the deal after Elon Musk's SpaceX acquired Cursor.

Why it matters: Turning down over $1 billion in annual revenue underscores how personal the rivalry between Sam Altman and Elon Musk has become, extending a competition already playing out in lawsuits and dueling model releases into commercial partnership decisions. It also signals OpenAI now treats SpaceX-linked ventures as a business risk large enough to override a major revenue stream, which could shape which coding-tool startups are willing to build on OpenAI's models.