SpaceX Secures Option to Buy AI Coding Startup Cursor for $60 Billion

Quick Facts

• SpaceX obtained rights to buy Cursor for $60 billion or pay $10 billion for collaborative work through end of 2026
• Cursor serves 67% of Fortune 500 companies and surpassed $1 billion in annual recurring revenue
• Deal follows Musk’s February merger of SpaceX with his AI startup xAI in a $1.25 trillion transaction

SpaceX secured an option to acquire AI coding startup Cursor for $60 billion later this year, according to an announcement Tuesday on X. The space company can alternatively pay $10 billion for joint development work between the companies.

The deal structure gives SpaceX flexibility through the end of 2026. The company can choose the full acquisition or the smaller development partnership, leaving Cursor’s future uncertain.

“SpaceXAI and @cursor_ai are now working closely together to create the world’s best coding and knowledge work AI,” SpaceX wrote in its Tuesday post. Cursor CEO Michael Truell said he was “excited to partner with the SpaceX team to scale up Composer,” referring to his company’s AI model.

Cursor has experienced explosive growth in valuation and business metrics. The company jumped from a $2.5 billion valuation in January 2025 to $9 billion by May and reached $29.3 billion after closing $2.3 billion in Series D funding in November. The startup is currently raising $2 billion at a valuation exceeding $50 billion.

The AI coding platform serves 67% of Fortune 500 companies and surpassed $1 billion in annual recurring revenue. The company estimates its tools write 150 million lines of enterprise code daily as of March.

The partnership addresses infrastructure needs following reports that xAI will rent computing power to Cursor. The coding startup plans to use tens of thousands of xAI chips to train its latest AI model. The deal pairs Cursor’s AI-native code editor with SpaceX’s Colossus supercomputer, which targets one million H100-equivalent GPUs.

“We’re very excited about working with them and we think SpaceX is basically the best company in the world when it comes to building out compute,” said Oskar Schulz, president of Anysphere, Cursor’s parent company.

The move represents xAI’s most aggressive push to compete with OpenAI and Anthropic in the developer tools market. Neither Cursor nor xAI currently offers proprietary models matching the leading capabilities from those competitors.

Either payment option would strain SpaceX financially. The company is widely seen as losing money following the xAI acquisition and purchase of social media network X, while planning extensive capital investments.

The announcement precedes SpaceX’s planned public debut targeting a $1.75 trillion valuation with a potential $75 billion fundraise that could become the largest IPO in history.

Read more: SpaceX cuts a deal to maybe buy Cursor for $60 billion