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SpaceX Announces Partnership with AI Coding Firm Cursor, Secures Option for Potential $60 Billion Acquisition

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SpaceX Announces Strategic Partnership with AI Coding Startup Cursor

SpaceX has entered into a partnership with artificial intelligence coding startup Cursor, which includes an option for SpaceX to acquire the company for $60 billion later this year. As an alternative to an acquisition, SpaceX could pay Cursor $10 billion for its collaborative work. The partnership will provide Cursor with access to SpaceX's computing infrastructure, including the Colossus supercomputer.

Announcement and Deal Structure

On Tuesday, SpaceX announced the agreement in a post on the social media platform X. The deal grants SpaceX the right to acquire Cursor for $60 billion. If SpaceX does not exercise this acquisition option, it will pay Cursor $10 billion for their joint work. The company statement did not specify whether either payment could be made in SpaceX stock.

SpaceX stated that the partnership aims to combine Cursor's product and its distribution network among software engineers with SpaceX's computing resources to develop advanced AI systems.

The partnership aims to combine Cursor's product and its distribution network among software engineers with SpaceX's computing resources to develop advanced AI systems.

Partnership and Technical Collaboration

As part of the collaboration, Cursor will gain access to SpaceX's computing infrastructure. This includes the Colossus supercomputer, which SpaceX claims has compute power equivalent to one million Nvidia H100 chips. Source 2 describes Colossus as being powered by 200,000 Nvidia GPUs.

Cursor announced a separate partnership with SpaceX subsidiary xAI to use its Colossus AI data center complex in Memphis, Tennessee. Cursor stated this access would help overcome computational bottlenecks and allow it to "dramatically scale up the intelligence of our models." The company plans to train its Composer 2.5 model using tens of thousands of GPUs on xAI infrastructure.

Cursor Company Profile

Cursor is an AI-powered code editor and integrated development environment (IDE) developed by San Francisco-based startup Anysphere. The company was founded in 2022 by four MIT classmates: CEO Michael Truell, Aman Sanger, Sualeh Asif, and Arvid Lunnemark.

  • Product: The assistant can predict code users are likely to write. With the launch of Cursor 3 in March 2026, it added agentic coding capabilities, where AI writes code based on broad user guidance.
  • Usage: The company's website lists customers including Stripe, Coinbase, Discord, Salesforce, Samsung, Budweiser, Neuralink, and Nvidia. Nvidia CEO Jensen Huang stated that 100% of Nvidia's software engineers and chip designers use Cursor. According to Fortune, 67% of Fortune 500 companies use Cursor's technology.
  • Employees: The company has between 300 and 400 employees with offices in San Francisco and New York.
  • Financials: Cursor raised an initial $60 million funding round in June 2024. By the end of 2025, it had raised three more rounds totaling $3.3 billion. Its valuation increased from $2.5 billion to $30 billion during 2025. According to Fortune, the company reached $100 million in annualized revenue in January 2025 and crossed $2 billion in annualized revenue in February 2026.
  • Investors: Investors include Andreessen Horowitz, Thrive Capital, Nvidia, and Google.

Recent Context and Background

The partnership follows several developments involving SpaceX, xAI, and Cursor:

  • SpaceX Corporate Moves: SpaceX acquired xAI in February 2026 and filed confidentially for an initial public offering (IPO) in April 2026. SpaceX has been acquiring other companies, including the social media network X.
  • Personnel Moves: Last month, two senior Cursor engineering leaders, Andrew Milich and Jason Ginsberg, left the company to join xAI, where they report directly to Elon Musk.
  • Cursor's Fundraising: Prior to the SpaceX announcement, TechCrunch reported that Cursor was considering a private fundraising round at a $50 billion valuation. A year ago, Bloomberg reported the company was in talks to raise funding at nearly a $10 billion valuation.

Competitive Landscape

Cursor currently uses and sells access to AI models from Anthropic (Claude) and OpenAI (GPT). Both Anthropic, with its Claude Code tool, and OpenAI are now competing directly with Cursor for the developer market. Some developers have reported switching to competing tools due to cost and performance considerations.

Neither Cursor nor xAI has proprietary AI models that match the leading offerings from Anthropic and OpenAI, according to Source 1.