SpaceX Explores New AI Avenues With $60 Billion Cursor Deal

SpaceX will spend $60 billion to acquire artificial intelligence coding startup Cursor.

The deal, announced in a regulatory filing Tuesday (June 16), comes soon after SpaceX’s gargantuan initial public offering (IPO). The all-stock transaction is expected to close in the third quarter of the year.

In a post on social platform X, which, like SpaceX, is owned by trillionaire Elon Musk, the company said the acquisition is designed to help SpaceX build “the world’s most useful AI models.” In its registration statement last month, SpaceX estimated a $28.5 trillion total addressable market, with around 93% connected to AI.

SpaceX has exercised the option to acquire @cursor_ai in an all-stock transaction with the goal of building the world’s most useful AI models.

For the past few months, SpaceXAI has been jointly training a model with Cursor, which will be released in Cursor and Grok Build soon.… https://t.co/X5mepgXgjJ

— SpaceX (@SpaceX) June 16, 2026

“For the past few months, SpaceXAI has been jointly training a model with Cursor, which will be released in Cursor and Grok Build soon,” the X post said. “We look forward to working closely with the Cursor team to advance our frontier AI capabilities.”

The deal follows a partnership between the two companies announced in April, with Cursor writing on its blog that the collaboration would help accelerate Cursor’s model training efforts. This came after it released its first agentic coding model, Composer, which was followed by increasingly capable models.

“We’ve wanted to push our training efforts much further, but we’ve been bottlenecked by compute,” Cursor said in the post. “With this partnership, our team will leverage xAI’s Colossus infrastructure to dramatically scale up the intelligence of our models.”

Cursor is at the center of the world of vibe coding, or the ability to express intent in “plain language and have AI systems translate that intent into functional outputs,” as PYMNTS wrote in January.

In a May report, PYMNTS examined SpaceX’s pre-IPO paperwork, which revealed just how intertwined Musk’s business empire has become.

“Tesla batteries power AI infrastructure and Tesla cash flows into SpaceX,” the report said. “There are social platform X advertising purchases, shared facilities, overlapping executives and intertwined financing arrangements, offering perhaps the clearest picture yet of how Musk’s empire increasingly operates less like a collection of separate businesses and more like a single industrial system.”

SpaceX may “represent the most extreme version yet” of a path charted by Nvidia, Amazon and Microsoft with their respective AI infrastructure and cloud businesses.

“The result is a business increasingly difficult to categorize within traditional sector boundaries,” the report said. “Is SpaceX a telecom provider? A defense contractor? An AI infrastructure company? A launch operator? The answer is increasingly all of the above.”

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