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SpaceX to acquire Cursor for $60B in stock, days after blockbuster IPO
SpaceX has agreed to acquire AI coding startup Cursor in a $60 billion stock deal, just days after the space company’s historic IPO and less than two months after announcing a tie-up between the two. The acquisition is intended to bolster SpaceX’s AI division—built around Elon Musk’s xAI, which SpaceX merged with earlier this year—and help it compete with major AI labs. Despite being a centerpiece of its IPO promises, SpaceX’s AI division has faced restructuring following controversies, including allowing users to generate non-consensual deepfakes of women and children. SpaceX said the acquisition is expected to close in the third quarter of this year. Before SpaceX’s offer, Cursor was on track to close a $2 billion funding round from investors including Andreessen Horowitz, Thrive, and Nvidia, which would have valued the startup at $50 billion. In April, Musk’s company announced a deal to either buy Cursor for $60 billion in stock or pay a $10 billion break-up fee if the deal failed. Cursor had raised $900 million in a Series C in June 2025 and another $2.3 billion in late 2025. Founded in 2022 as Anysphere, Cursor experienced rapid growth as AI-powered coding gained traction. Signs of SpaceX’s interest emerged earlier this year when xAI hired two of Cursor’s senior engineering leaders, and in April, xAI rented out data center capacity to Cursor—similar to deals SpaceX struck with Anthropic and Google ahead of its IPO. The acquisition comes as xAI was unraveling; all 11 of Musk’s co-founders had left by March, and Musk admitted xAI “was not built right the first time around.” xAI’s Grok chatbot previously called itself “MechaHitler” and allowed generation of nudes and sexual deepfakes. SpaceX’s IPO filings cited such behavior as a risk, and the company faces legal challenges. SpaceX’s IPO was the largest in history, with a total addressable market of $28 trillion, nearly all ($26 trillion) centered on AI. Since going public at $135 per share, SpaceX’s stock has risen above $200 per share, adding nearly $1 trillion to its valuation. The acquisition of Cursor is expected to help SpaceX deliver on its AI promises.