SpaceX closes $60B acquisition of AI coding startup Cursor in landmark tech M&A deal

SpaceX has completed its all-stock acquisition of artificial intelligence coding startup Cursor for $60 billion, a landmark deal that became effective Aug. 14, according to a regulatory filing cited by ArkansasOnline. The transaction follows regulatory approval and SpaceX's transition to a public company, according to Hypebeast.

The purchase, one of the largest tech acquisitions ever, absorbs Cursor into SpaceX's growing SpaceXAI division. Cursor's AI coding assistant, launched in 2023, was designed to help programmers write and debug code more efficiently and became one of the fastest-growing startups ever, central to what ArkansasOnline described as the "vibe coding" era where software developers build applications through chatbot prompts.

Cursor was founded by four former Massachusetts Institute of Technology students — Michael Truell, Aman Sanger, Sualeh Asif, and Arvid Lunnemark — whose journey Forbes characterized as "dorm to 60B." The deal makes the co-founders billionaires and gives the startup's team access to SpaceX's stockpile of advanced AI chips, according to ArkansasOnline.

The deal was announced in April, with SpaceX receiving an option to acquire Cursor for $60 billion, as Forbes reported. Two months later, after SpaceX became a public company, the firms said they were moving forward with the acquisition.

**Joint AI models and compute power**

SpaceX and Cursor released their first joint model, Grok 4.5, in July, focused on coding, finance and legal tasks at a lower cost than competing models, ArkansasOnline reported. Since then, SpaceX introduced Grok Bot, a product that operates like a team of AI agents handling assignments throughout the day, and released an updated Grok 4.6 model.

Cursor's teams have been working on Grok 4.6, Forbes noted. In an announcement on Cursor's website, spokespersons said the model "stays with complex tasks across many steps, whether researching a topic, analyzing information, working across a codebase, or turning an idea into a polished application or work artifact." Grok 4.6 is trained on agentic reinforcement learning tasks including knowledge work, general coding, and domain-specific environments for kernel optimization, web development, and computer-aided design.

"We have access to the largest fleet of GPUs in the world, giving us the compute to build stronger models that are also more economical to run," Cursor said in a blog post Friday, as reported by both Forbes and ArkansasOnline. Forbes identified that fleet as xAI's Colossus facility in Memphis, Tennessee, which operates an estimated 200,000 Nvidia GPUs, with plans for Colossus 2 to add up to 500,000 more chips.

**Musk's AI push and financial picture**

Elon Musk's broader AI strategy has included acquiring his own AI venture xAI earlier this year, Forbes reported. His AI unit, now called SpaceXAI, previously had limited business adoption and underwent a series of job cuts and restructurings, according to ArkansasOnline.

Alongside the Cursor deal, SpaceX has struck multibillion-dollar deals allowing companies including Anthropic and Alphabet Inc.'s Google to tap into its computing resources, ArkansasOnline reported. But in a meeting with SpaceX staffers in August, Musk stressed that the company "must succeed on the software front." According to ArkansasOnline, Musk told staff: "Our AI revenue will exceed all other SpaceX revenue by September."

SpaceX's stock price has seen volatility since the deal was announced. Forbes reported that after an initial public offering price of $160 per share, the stock rose to around $210 before bottoming out at just over $100, and recently recovered to approximately $150, near the IPO price. Forbes attributed concerns about share dilution tied to the Cursor acquisition.

The Cursor acquisition marks a major milestone in the convergence of space technology and artificial intelligence, with Musk positioning SpaceX to compete directly against AI leaders Anthropic and OpenAI. As Forbes noted, "The 'Cursor Four' seems to have been timely."