Codex, Cursor and the Great Beyond
OpenAI will be put under pressure by Meta AI, SpaceXAI and China - not just Anthropic's Enterprise AI momentum.
Good Morning,
AI Supremacy is also a Newsletter where we track the intersection between BigTech, BigAI and the best AI startups competing for future marketshare.
Incumbents will be put under pressure. Microsoft backed OpenAI is sort of in incumbent territory already. Today, let’s take a closer look into Codex.
In March we learned that OpenAI want to create a “Super-app” that combines ChatGPT and Codex. With just a few months before a supposed IPO, that’s an awkward pivot for OpenAI, where ChatGPT no longer even has a 50% marketshare.
Until January, 2026 ChatGPT commanded over 50% market share, but by May's end, it had fallen to 46.4% thanks to the rise of Gemini (27.7%) and Claude (10.3%). Now with Meta’s AI app gaining initial momentum, who knows where ChatGPT will even be by year’s end. There’s also a problem with OpenAI’s pivot to Enterprise AI, SpaceX just finished the acquisition of Cursor.
“For the past few months, SpaceXAI has been jointly training a model with Cursor, which will be released in Cursor and Grok Build soon.” - SpaceX
Why OpenAI is Under Pressure in Marketshare
Meanwhile the Meta AI app is experiencing a massive surge in momentum, driven by deep integration into Meta's 3.5 billion daily active users ecosystem, standalone mobile app growth, and aggressive rollouts of new native features like "AI Mode" across Facebook. How fast can that increase?
On the Enterprise AI side outside of Anthropic’s dominance, Cursor’s ARR hit $4 Billion in June. OpenAI thus has competitive pressures both in B2C and B2B. This means OpenAI’s execution risk in merging ChatGPT with Codex is high and the result might determine what kind of future the business will have in such a competitive market.
Jeff Morhous is the author of The AI-Augmented Engineer. He will be covering the Codex section of the article.
Cursor’s acceleration of revenue and entry into AI agents makes it an ideal fit to help scale SpaceXAI’s bold ambitions to scale Enterprise AI customers that makes up a generous part of SpaceX’s speculative TAM (total addressable market in its S-1) to say the least. While ChatGPT has hit a supposed 1 Billion users (MAUs), it’s losing marketshare very rapidly. The latest iteration of a State of AI mid 2026 report goes into some great details:
I really enjoyed this SenseTower report, they are not an affiliate.
ChatGPT’s 3.5 Year First Mover Advantage is Shrinking
Sensor Tower’s State of AI Report also found that users are increasingly willing to switch between assistants. ChatGPT will be put under pressure by Google’s Gemini, Claude, SpaceXAI, Meta AI as well as a well funded DeepSeek, Alibaba Qwen, Moonshot AI and Z.AI and ByteDance that are evolving rapidly.
Sense Towers State of AI Report has a lot of tidbits as well for those of us who follow AI closely. Like for instance, that Anthropic’s Claude earns more revenue per user than ChatGPT does. That emphasis on B2B and superiority in coding models is really turning out to be a better commercial strategy.
ChatGPT fast to 1 Billion MAUs but Trouble is Ahead
Claude’s average revenue per user on mobile in the US rocketed from under $0.50 last September to $2.76 in May.
Today’s article will have many interesting OpenAI Codex related links.
Read: Codex wants to work on more than just code
Using NotebookLM to learn new things
The ultimate guide to Codex goals
How OpenAI prompts Codex for the best results
Meanwhile both contemporaries and younger AI startups are getting serious funding that will challenge OpenAI’s dominance. I project China’s AI ecosystem to have a really breakout 2027.
SpaceXAI Acquiring Cursor (Anysphere) for $60 Billion
SpaceX expects the merger to close during the third quarter of this year and they are already collaborating rapidly on new coding models. This gives what was formerly xAI (a relative failure vs. cash burn), a serious boost in revenue and momentum. It also entirely changes the landscape and puts more pressure on OpenAI, given the wild success of the SpaceX IPO. At time the time of writing ticker SPXE 0.00%↑ is up 31% since its IPO last Friday with a market cap that overtook Amazon and even briefly reaching the market cap of Microsoft.
I had already believed Anthropic and Google were putting pressure on OpenAI and had overtaken them in certain ways. Now the rise of SpaceXAI and Meta AI via their AI app means OpenAI is highly likely to continue to struggle.
All of this totally changes the future of AI.
Cursor exits with a $4B in run rate growing 7x YoY. It’s hard to find such an MIT startup success story in the history of technology. The four 25yo MIT founders will make ~$2.7B (each) in a span 4yrs and first 50 startup hires ~$20-500M each. It’s an AI coding exit for the ages.
They could have gotten another round in funding where before SpaceX came knocking, Cursor was on track to close a $2 billion funding round from the likes of Andreessen Horowitz, Thrive, and Nvidia that would have valued the AI coding startup at $50 billion. But that never materialized, getting a compute deal with SpaceX quickly escalated into an acquisition deal. With the costs of compute, Cursor was burning cash too fast (at that point in time) even with its meteoric growth. SpaceX being heavily in debt and unprofitable, can absorb those types of loses.
Where to learn more about working with Codex
Let’s say you have an open mind to using Codex as an AI tool.
The OpenAI Academy (not an affiliate) has a lot of workshops and live sessions on using Codex. OpenAI’s spending on marketing and education has been considerable the past few years, but then again Codex might evolve into a useful general purpose tool. If OpenAI ever hopes to have a path to profitability, Codex needs to shine.
⚡ Codex for everyday use
🖥️ Building websites with Codex Sites
💐 Codex for creative building
ChatGPT’s marketshare is declining rapidly
The Generative AI trend is a story of rapidly shifting business and consumer preferences and more and more options.
I am Obsessed with AI and Trust - Public Poll:
I conducted similar polls on LinkedIn and Substack Notes and there appears to be a growing consensus. In the above poll I add SpaceX as the Cursor acquisition changes xAI’s abysmal execution and performance substantially.
The story of OpenAI’s Codex plan is even more particular. I’ll turn it over to Jeff Morhous now.
What’s new in OpenAI’s Codex
Codex used to be easy to explain.
It was OpenAI’s tool for developers. You pointed it at a repo, gave it a coding task, and it helped you turn ideas into working software. If you’ve heard of Claude Code, it was just OpenAI’s version of that tool.
But something weird is happening. Codex is starting to outgrow code.
OpenAI is turning Codex from a developer tool into a general-purpose agent for knowledge work. Gmail, Calendar, PowerPoint, computer use, and even an upcoming merge with ChatGPT.
Codex is no longer just where software engineers go to automate coding tasks. It’s becoming the place where OpenAI wants work to happen.
Codex has historically been for developer
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