OpenAI to cut off Cursor AI coding tool after SpaceX acquisition

OpenAI announced Friday it will terminate its partnership with Cursor, the widely-used AI coding assistant now owned by SpaceX, setting a contract end date of November 12, 2026.

The move represents the latest chapter in the ongoing dispute between OpenAI CEO Sam Altman and Elon Musk, according to details first reported by Mashable. SpaceX completed its acquisition of Anysphere, Cursor's parent company, earlier in August 2026, following a deal announcement in June. The acquisition was valued at $60 billion.

Trust concerns drive the decision

In a company blog post, OpenAI framed the termination as a trust issue. The company stated it could not be confident SpaceX would use its technology in accordance with OpenAI's terms of service. OpenAI pointed to what it described as a pattern of contract violations by Musk's companies.

Specifically, OpenAI alleged that X breached its contract terms after Musk's acquisition of that platform. The company also noted that Musk admitted under oath earlier in 2026 that xAI had violated OpenAI's terms of service.

OpenAI said its custom agreement with Cursor included only a limited window to cancel following a change of ownership. The company proposed the November 12 shutoff date, which represents the maximum notice period allowed under the existing contract. OpenAI described the decision as "incredibly tough" given its goal of widespread model access, but said it wanted to preserve developer access for as long as contractually possible.

Musk and Cursor respond

Musk responded on X, writing that he "couldn't care less" while calling Altman and OpenAI president Greg Brockman "untrustworthy." He repeated his long-standing claim that the pair "stole an open source nonprofit."

Michael Truell, Cursor's co-founder and now a SpaceX executive, took a more measured approach, stating on X that the company was in discussions with OpenAI's team to resolve the issue.

Following the announcement, Anthropic—an OpenAI competitor with an existing SpaceX partnership—said it would increase compute support for its Claude models within Cursor.

Why it matters

The termination affects developers who rely on Cursor's integration with OpenAI's models for AI-assisted coding. More broadly, it demonstrates how personal disputes between tech leaders can disrupt business relationships and force companies to choose sides in industry conflicts. The move also highlights OpenAI's willingness to walk away from commercial relationships when ownership changes raise concerns about terms-of-service compliance—a precedent that could affect future enterprise partnerships.

The Altman-Musk feud has been playing out for years. Musk sued OpenAI and Altman for $150 billion over the company's shift from nonprofit status; a federal jury ruled against him earlier in 2026, finding he filed too late. The conflict has repeatedly spilled onto social media, with Altman reposting allegations about document preservation failures by Musk's companies and saying he was "really excited" to depose Musk.

Mashable first reported these details.