SpaceX Eyes $60B Cursor Deal to Boost AI Power Ahead of IPO

Elon Musk’s SpaceX has announced plans to collaborate with AI coding startup Cursor, with the option to acquire the company later this year in a deal valued at $60 billion. The aerospace giant also revealed an alternative arrangement, allowing it to form a strategic partnership with Cursor for $10 billion instead of pursuing a full acquisition.

The potential deal highlights SpaceX’s growing ambitions in artificial intelligence, particularly in AI-powered software development. According to a company statement, combining Cursor’s advanced coding tools and strong adoption among professional developers with SpaceX’s massive computing infrastructure could accelerate the creation of highly capable AI models. SpaceX emphasized its “million H100 equivalent Colossus training supercomputer” as a key advantage in this partnership.

This development follows recent reports that xAI, Musk’s AI venture now integrated into SpaceX, had been in discussions to provide computing power to Cursor. The startup is expected to train its most advanced AI systems using xAI’s hardware, signaling a deeper collaboration between the companies. Adding to this momentum, two senior engineers from Cursor recently transitioned to xAI, further strengthening ties between the organizations.

Cursor has quickly emerged as one of the fastest-growing platforms in the AI coding space, reportedly targeting a $50 billion valuation during a recent private funding round. However, both Cursor and xAI still trail industry leaders such as OpenAI and Anthropic in developing cutting-edge AI models. The potential partnership or acquisition appears aimed at closing that gap and enhancing competitiveness in the rapidly evolving AI market.

The move comes at a critical time for SpaceX as it prepares for a highly anticipated initial public offering. The company is reportedly seeking a valuation of around $1.75 trillion while aiming to raise $75 billion. Despite the significant cost of acquiring Cursor, the deal could position SpaceX as a major player in AI innovation, particularly in the fast-growing field of AI-assisted coding.