Key facts
- SpaceX is acquiring AI coding startup Cursor for $60 billion.
- Cursor has over 1 million daily active developers and is used in 67% of Fortune 500 companies.
- The acquisition aims to give SpaceX a competitive edge against rivals Anthropic and OpenAI.
- Cursor will become a wholly owned subsidiary of SpaceX upon deal closure in the third quarter.
- The partnership will integrate Cursor with SpaceX's xAI subsidiary and its Colossus supercomputer.
SpaceX is set to acquire artificial intelligence startup Cursor for $60 billion, a move that positions Elon Musk's space exploration and AI company to compete more directly with rivals Anthropic and OpenAI. The acquisition, expected to close in the third quarter, will make Cursor a wholly owned subsidiary of SpaceX.
Cursor, developed by San Francisco-based Anysphere, is a popular AI coding assistant that has sparked a trend known as "vibe coding." SpaceX views Cursor's wide distribution among expert software engineers as a key attraction, providing access to a valuable customer base. The partnership will also enable Cursor to leverage xAI's massive AI data center complex, Colossus, located in Memphis, Tennessee, for developing future AI products.
Cursor, founded in 2022 by four MIT students, has experienced rapid growth. It was valued at $400 million in a Series A funding round in mid-2024, increased to $2.5 billion by January 2025, and closed a $2.3 billion Series D in November 2025 at a valuation of $29.3 billion. The company has surpassed $1 billion in annualized recurring revenue, with year-over-year growth exceeding 9,900%. It boasts over 1 million daily active developers and has achieved habitual daily use by elite engineers within 67% of Fortune 500 companies.
While OpenAI's Codex has a significant user base, and Anthropic's Claude Code is widely used by professional engineers, xAI has lacked a comparable product. SpaceX acquired xAI in an all-stock deal in February 2026, inheriting the Colossus supercomputer without a flagship application. The collaboration with Cursor is intended to fill this strategic gap, providing a world-class product to route traffic through the Colossus infrastructure, which is equivalent to 1 million Nvidia H100 GPUs.
The deal structure involves an initial $10 billion collaboration to develop "coding and knowledge work" AI, with SpaceX holding the right to acquire Cursor outright later this year. This transaction represents a three-part bet for SpaceX: utilizing compute power with a killer app, securing distribution through Cursor's embedded workflow loyalty among elite engineers, and integrating Cursor's expertise with its own AI infrastructure.