SpaceX to Buy AI Coding Startup Cursor for $60 Billion in All-Stock Deal

A $60 billion bet bought with soaring stock

SpaceX said Tuesday it had entered a formal agreement to buy Anysphere, the startup behind the popular AI coding tool Cursor, for $60 billion in an all-stock deal.cnbc +1 The announcement landed just days after Elon Musk's rocket-maker completed the largest initial public offering in history, a Nasdaq debut that pushed its valuation past $2 trillion.reuters The timing was no accident: paying entirely in shares lets SpaceX exploit its towering market value, with the purchase representing roughly 3.4% dilution at the company's IPO valuation.cnbc

Investors cheered. SpaceX stock climbed sharply on the news — gaining as much as 16% — lifting the company past Amazon to rank among the most valuable in the United States.cnbc +1 At one point its valuation touched $2.97 trillion, having risen about 56% from the $135 IPO price set on Friday.reuters +1

Catching up in the AI coding race

The deal is meant to strengthen xAI, the AI business Musk folded into SpaceX earlier this year, in one of the few corners where AI has produced real enterprise revenue.reuters SpaceX said it would soon release an AI model on Cursor alongside Grok Build, xAI's coding agent.reuters Cursor, founded in 2022, crossed $1 billion in annualized revenue last year, though its market share in AI coding slid from 41% in June 2025 to about 26% by May as Anthropic seized roughly half the category.cnbc

SpaceX had circled the startup for months, securing an option in April to either buy Cursor for $60 billion or pay $10 billion for a partnership.reuters +1 The all-stock transaction will not draw on IPO proceeds and is expected to close in the third quarter; SpaceX would owe a $10 billion termination fee if the deal collapses, or $4 billion if it fails on antitrust grounds.reuters

A struggling division leans on a trusted tool

The acquisition comes as xAI rebuilds following a turbulent stretch. All 11 of Musk's xAI co-founders had departed by the end of March, and the unit has weathered controversies including its Grok chatbot generating non-consensual deepfakes.techcrunch SpaceX pitched IPO investors on a $28 trillion addressable market, nearly all of it tied to AI.techcrunch

Analysts framed Cursor's more than one million developers as the real prize. "Owning the tool that professional developers already trust daily is a faster path to enterprise AI revenue than winning the model race," said PitchBook's Harrison Rolfes.theguardian Billionaire investor Bill Ackman noted the math favored Musk: "The Cursor acquisition costs materially less in dilution because of SpaceX's high valuation."reuters +1