Microsoft considered buying AI coding startup Cursor prior to SpaceX's acquisition of Cursor for $60 billion, according to two people familiar with the matter. Microsoft, which is aiming to boost the popularity of its AI tools, chose not to proceed with a bid. While Microsoft has gained popularity with its GitHub Copilot service, the AI coding market is currently being dominated by Cursor, Anthropic and OpenAI. The SpaceX deal came together late in Cursor's fundraising process, which was caught off guard by the news. Microsoft declined to comment on the matter, but Cursor CEO Michael Truell expressed excitement about partnering with SpaceX to scale up its AI model.