OpenAI to End Cursor Model Contract After SpaceX Acquisition

OpenAI announced on August 28, 2026 that it has notified SpaceX (SPCX ) of its intent to wind down the contract under which it supplies OpenAI models to Cursor, the AI coding company that SpaceX acquired earlier this month. The company set a proposed shutoff date of November 12, 2026.

OpenAI said it is giving the maximum notice provided by the contract in order to maximize the time developers can retain access to its models through Cursor. It stated that it made the decision because it cannot be confident SpaceX will use its technology within OpenAI’s terms of service, citing what it described as its experience with Elon Musk‘s companies violating contracts.

The company said that working with a large partner like SpaceX typically relies on custom contracts to ensure compliance with its terms of service and that the integration provides for safety at scale. It stated that after Musk acquired Twitter, which is now part of SpaceX, the company broke the terms of its contract with OpenAI, alongside contracts with many others. OpenAI also stated that under oath earlier in 2026, Musk admitted that xAI, which is now also part of SpaceX, had violated OpenAI’s terms of service, terms it described as similar to xAI’s own.

Contract Mechanics and the Astra Model

OpenAI said its custom agreement with Cursor gives it a limited time window to cancel the contract after a change of control. It also cited accountability for its upcoming model, Astra, stating that as AI capabilities advance it must ensure Astra is used in accordance with its terms. “Given all of this, we’ve decided to hold the contract cancellation to the latest date we can while not providing future models to Cursor,” the company wrote.

The Astra reference points to an earlier OpenAI disclosure dated August 7, 2026, in which the company said internal evaluations of Astra indicated significant advancements in agentic coding and cybersecurity. In that post, OpenAI said those results, together with expert assessments, led it to conclude it could not rule out critical cyber capabilities under its Preparedness Framework. Previous models, including GPT-5.6-Sol, had been assessed at the High rather than Critical threshold, the company said.

Under that framework, OpenAI wrote, a model reaches the Critical cybersecurity threshold if it can identify and develop functional zero-day exploits of all severity levels in many hardened real-world critical systems without human intervention, or can devise and execute end-to-end novel strategies for cyberattacks against hardened targets given only a high-level desired goal. OpenAI said its preliminary evaluations of Astra indicated strong enough performance that it could not rule out the Critical capability level, and that it was continuing to benchmark and assess the model. It also said Astra was not involved in exploiting Hugging Face.

The August 7 disclosure listed steps OpenAI said it had taken, including stricter security controls for higher-capability models, a pause on internal Astra activities not yet meeting strengthened requirements, and universal monitoring for risky actions and misalignment across all agentic applications of Astra. It said it would work with relevant government agencies and select AI safety organizations to test the model’s capabilities.

The SpaceX-Cursor Transaction

Cursor announced on August 14, 2026 that it had officially been acquired by SpaceX, completing a process it said started in April with a partnership with SpaceXAI to accelerate its model training efforts. Cursor said that as part of SpaceX it would have access to the largest fleet of GPUs in the world, giving it compute to build stronger models that are also more economical to run, and that this would let it provide customers with more capable models at lower cost. It cited Grok 4.6, which it said it released that week, as an early look at what the companies could build together.

The transaction terms appear in a Form 8-K filed by Space Exploration Technologies Corp. on June 16, 2026. The filing states that SpaceX, its wholly owned subsidiary X67 Inc., and Anysphere, Inc., which the filing identifies as Cursor, entered into an Agreement and Plan of Merger under which the subsidiary would merge into Cursor, with Cursor surviving as a wholly owned SpaceX subsidiary. At the effective time, each outstanding share of Cursor common and preferred stock would convert into the right to receive SpaceX Class A common stock based on an implied Cursor equity value of $60.0 billion and a SpaceX share price equal to the volume-weighted average closing price over the seven consecutive trading days immediately preceding the closing. The filing said the issuance would rely on the Section 4(a)(2) exemption from registration, and that SpaceX expected the merger to close during the third quarter of 2026, subject to closing conditions including requisite regulatory approvals.

OpenAI said it had worked with Cursor for nearly four years and expressed respect for Cursor’s team, product, and what it built for the developer community. It said the people most affected by its decision are the developers who rely on OpenAI models in Cursor, and that it is ready to support them through the transition.