Aside of how this looks like an AI-generated PR puff piece, it comes waaay too late after the Windsurf deal busted (OpenAI refusing to buy them after all) and Google cherry-picked the employees they wanted without wanting to buy the company, the artificial ARR-blown valuation disappearing in thin air and investors losing pretty much everything.
The thing is: those "$100M+" of negative-margin ARR don't mean anything positive for Cursor, just like it didn't for Windsurf; quite to the contrary, it's just a measure of capital bleed with an unsustainable model in a negative margin death spiral: the more of that artificial ARR they make, the closer they get to bust.
To be honest I have never used Cursor nor do I know their pricing, but isn't revenue kind of a stupid metric if you're just a frontend for a paid API? Like wouldn't almost all of this revenue just go through them towards OpenAI or Anthropic?
Aside of how this looks like an AI-generated PR puff piece, it comes waaay too late after the Windsurf deal busted (OpenAI refusing to buy them after all) and Google cherry-picked the employees they wanted without wanting to buy the company, the artificial ARR-blown valuation disappearing in thin air and investors losing pretty much everything.
The thing is: those "$100M+" of negative-margin ARR don't mean anything positive for Cursor, just like it didn't for Windsurf; quite to the contrary, it's just a measure of capital bleed with an unsustainable model in a negative margin death spiral: the more of that artificial ARR they make, the closer they get to bust.
For a description of the problem, see https://ethanding.substack.com/p/windsurf-gets-margin-called which was discussed here: https://news.ycombinator.com/item?id=44843801
To be honest I have never used Cursor nor do I know their pricing, but isn't revenue kind of a stupid metric if you're just a frontend for a paid API? Like wouldn't almost all of this revenue just go through them towards OpenAI or Anthropic?
Isn't the playbook with a $120M+ annual LLM bill?
This post is just ChatGPT slop
Cool, cool, now let's see their profits on that annualized (not annual!) recurring revenue.
I'll grab the popcorn in the meantime.