SpaceX to acquire Cursor for $60B stock after blockbuster IPO
The $60 billion all-stock deal days after SpaceX's IPO fuels its AI ambitions.
SpaceX has agreed to acquire AI coding startup Cursor for $60 billion in stock, finalized just days after the space company’s historic IPO. The deal, which includes a $10 billion break-up fee if it falls through, aims to supercharge SpaceX’s AI division. This division was built around Elon Musk’s xAI, which SpaceX merged with earlier this year but has struggled with repeated controversies — including its Grok chatbot generating non-consensual deepfakes and the departure of all 11 xAI co-founders. In IPO filings, SpaceX pitched a $28 trillion total addressable market, with $26 trillion tied to AI efforts — including a $2.4 trillion AI infrastructure business and $22.7 trillion in enterprise applications. Cursor, founded in 2022 as Anysphere, had been on a meteoric rise, raising over $3 billion in previous rounds and attracting interest from Andreessen Horowitz, Thrive, and Nvidia. Before SpaceX’s offer, Cursor was on track to close a $2 billion funding round at a $50 billion valuation. Signs of the deal emerged earlier this year when xAI hired two of Cursor’s senior engineering leaders and rented data center capacity to the startup. SpaceX’s stock has surged from its IPO price of $135 to over $200 per share in pre-market trading, adding roughly $1 trillion to its market cap — about 16 Cursors’ worth — in just a few days.
- SpaceX to acquire Cursor for $60B in stock, with a $10B break-up fee if the deal falls through.
- Cursor was valued at $50B before the deal and had raised over $3B from top VCs; it was burning cash and needed more funding.
- xAI, which SpaceX had merged with, was in turmoil — all 11 co-founders left, and its Grok chatbot generated deepfakes, leading to legal challenges.
Why It Matters
SpaceX's AI ambitions now ride on Cursor's code tools to capture a $26 trillion market, leveraging post-IPO stock wealth.