SpaceX to acquire AI coding startup Cursor for $60B after IPO

SpaceX expects to complete its $60 billion acquisition of AI coding startup Cursor roughly 30 days after it begins trading publicly, according to Bloomberg, a timeline that would place the deal in July if the company’s blockbuster IPO proceeds on schedule.

The rocket, satellite, and artificial intelligence conglomerate is planning to file its public IPO prospectus as soon as Wednesday and list shares on the Nasdaq on 12 June under the ticker SPCX. SpaceX is seeking to raise $75 billion at a valuation of roughly $1.75 trillion, which would make it the largest stock-market debut in history, eclipsing Saudi Aramco’s $29.4 billion offering in 2019.

SpaceX disclosed in April that it had secured an agreement giving it the right to acquire Cursor for $60 billion. If the deal falls apart, SpaceX would instead pay a $10 billion breakup fee in cash for the companies’ joint work. The announcement, made on X, said the two firms were “now working closely together to create the world’s best coding and knowledge work AI.”

The company did not immediately acquire Cursor at the time because of the imminent IPO process. The deal still requires regulatory review, and neither Cursor nor SpaceX responded to requests for comment from Bloomberg.

From startup to $60 billion target in three years

Cursor, which launched its AI coding assistant in 2023, has become one of the fastest-growing startups of all time. The tool helps programmers write, debug, and ship code using AI, and has accumulated more than one million paying customers. Its annualised revenue hit $500 million in May 2025 and doubled to $1 billion by October of that year. Earlier this year, Cursor was in talks to raise $2 billion at a valuation of roughly $50 billion, with Andreessen Horowitz, Thrive Capital, and Nvidia among the investors.

Cursor has also become a central player in the “vibe coding” movement, a workflow in which developers provide high-level intent and AI agents handle much of the execution. The company released Composer 2.5 on Monday, its latest agentic coding model. According to Cursor’s blog, Composer 2.5 was built on Moonshot AI’s open-source Kimi K2.5 checkpoint and refined through more difficult reinforcement-learning environments and 25 times more synthetic tasks than its predecessor. Separately, Cursor has announced plans to train a larger model from scratch using xAI’s Colossus 2 supercomputer, though no release date has been set for that effort.

The SpaceX-xAI empire

The planned Cursor acquisition would further expand an already sprawling Musk empire. SpaceX completed its merger with xAI, Musk’s artificial intelligence company and the parent of social media platform X, in February 2026 in an all-stock transaction that valued the combined entity at $1.25 trillion. That deal, the largest merger in corporate history, folded xAI’s Grok chatbot, its Colossus data-centre infrastructure, and the former Twitter platform into SpaceX’s operations.

For xAI, bringing Cursor into the fold represents an effort to close the gap with rivals in the AI coding tools market. GitHub Copilot, backed by Microsoft and OpenAI, holds roughly 37% market share with 4.7 million paid subscribers, while Anthropic’s Claude Code has emerged as a fast-growing competitor. Acquiring Cursor, which counts 67% of the Fortune 500 among its users, would give SpaceX an immediate foothold in the enterprise developer tools space.

Whether the deal closes on time, however, depends on two things: a successful IPO and regulatory approval. With a $10 billion cash penalty on the line if it falls through, both sides have substantial incentive to see it to completion.