Cognition, the startup behind the popular artificial intelligence coding agent Devin, has announced that it has reached an agreement to acquire Windsurf, an AI coding startup.
This news comes just days after Google hired Windsurf’s CEO Varun Mohan, co-founder Douglas Chen, and research leaders in a $2.4 billion reverse-acquihire deal. However, the majority of Windsurf’s 250-person team did not join Google. Google’s acquisition followed the expiration of OpenAI’s $3 billion offer to buy Windsurf.
Competition among companies offering AI-powered integrated development environments (IDEs), such as Windsurf and Cursor, has rapidly intensified. Cursor’s annual recurring revenue (ARR) has reached $500 million. While Windsurf’s business is smaller than Cursor’s, it has seen significant growth over the past year and attracted interest from major companies.
Former Windsurf head of business Jeff Wang wrote on LinkedIn that the past 72 hours have been the most intense and fast-moving period of his career. He expressed excitement about joining the Cognition team.
Cognition is acquiring Windsurf’s AI-powered IDE product, its intellectual property, and all employees who did not join Google. The purchase price was not disclosed, but Windsurf reportedly has an ARR of $82 million, with a customer base of at least 350 enterprise clients and hundreds of thousands of daily active users.
Going forward, the Windsurf team will continue working on the IDE, while Cognition will focus on its AI agent Devin. Eventually, Windsurf’s technology will be integrated into Cognition’s products.
It is worth noting that Windsurf’s ARR reached $100 million in April 2025, but in June, Anthropic—provider of popular AI models—restricted Windsurf’s direct access to its Claude AI models. As a result, some Windsurf customers switched to other services like Cursor. Cognition states that after the acquisition, Windsurf will regain full access to Claude AI models.
The acquisition deal was completed within just a few days after Google’s agreement became public. Cognition president Russell Kaplan noted that negotiations started late Friday evening and the agreement was signed Monday morning.
Cognition also confirms that all Windsurf employees will financially benefit from the deal, with previous vesting restrictions on bonuses waived.
With Windsurf’s expertise and technology, Cognition is poised to become a stronger competitor against leading AI coding companies such as OpenAI, Anthropic, and Cursor. Cognition reportedly held talks in March to raise hundreds of millions of dollars at a $4 billion valuation.
Cognition was among the first startups to launch a fully developed AI coding agent, Devin, which aims not just to assist programmers but to fully automate coding tasks like a junior software engineer. Although Devin initially had some errors, this technology is expected to improve over time.
Recently, Cursor and Windsurf have begun offering more agent-oriented AI products that resemble Cognition’s approach. Cursor CEO Michael Truell predicts that by 2026, 20% of coding workflows will be handled by AI agents.
Now, Cognition offers both an AI coding agent and an AI-powered IDE, providing a stronger and more versatile service. The company also recently secured a partnership with Wall Street giant Goldman Sachs.
With the acquisition of Windsurf, Cognition emerges as a serious competitor in the AI coding space.
