SpaceX pre-announced the deal at X New York Times report it framed it as a done deal. The structure gives SpaceX an option: call it quits by the end of the year or walk away, paying $10 billion for shared computing access and joint modeling work. Cursor CEO Michael Truell called it a partnership to “expand Composer.”
SpaceX provided a call option to acquire AI coding startup CursorIt was developed by San Francisco-based Anysphere to pay $60 billion later this year, or alternatively $10 billion, for the two companies’ joint AI development work.
SpaceX announced the arrangement in a post on X on Tuesday, describing how SpaceXAI and Cursor will work together. “Build the world’s best coding and knowledge work AI.”
That post came before the New York Times published a story citing two people who said SpaceX had agreed to buy Cursor for $50 billion. The Times later updated its story to reflect that SpaceX framed the deal as an option rather than a completed acquisition.
Cursor CEO Michael Truell confirmed the arrangement in a post on X “I’m excited to collaborate with the SpaceX team to scale Composer,” A reference to the custom AI model of the cursor. The selection period lasts until the end of 2026.
Whether SpaceX pursues the $60 billion option will depend in part on how development of the joint model progresses in the months that follow. Details of staff transfers or integration have not been disclosed.
The commercial logic of both sides is clear. Cursor, a fork of Visual Studio Code with deep AI integration developed by Anysphere, a company founded in 2022 by four MIT students: Michael Truell, Sualeh Asif, Arvid Lunnemark, and Aman Sanger, has grown rapidly to become a benchmark for AI-era startups.
It was valued at $400 million in Series A in mid-2024, raised to $2.5 billion by January 2025, raised $900 million to $9.9 billion in June 2025, and closed a $2.3 billion Series D in November 2025 for $29.3 billion.
By February 2026, it had surpassed $2 billion in annual recurring revenue, making it the fastest B2B company to scale from zero to $2 billion in nearly three years, according to widely cited metrics.
More than half of the Fortune 500 now use Cursor. Co-founder and CTO Arvid Lunnemark left in October 2025 to found Integrous Research, an AI security lab; the remaining three founders continue to lead the company.
For SpaceX, which Elon Musk’s AI venture has mastered xAI The deal closes an apparent gap in the February 2026 all-stock transaction that values the combined entity at $1.25 trillion.
while The OpenAI Codex has reached three million weekly users and Anthropic’s Claude Code has become the most used AI coding tool among professional engineers, xAI has no comparable product.
Targeting a million H100-equivalent GPUs, the Colossus supercomputer in Memphis provides SpaceX with a training infrastructure at scale, but without a lead program to guide it.
Cursor partnership provides that application. SpaceX had already hired two Cursor engineers, Andrew Milich and Jason Ginsberg, after the xAI co-founders left the country. Last week, xAI began leasing computing power to Cursor, allowing it to use tens of thousands of xAI chips to build the startup’s latest model, signaling a commercial tie-up ahead of Tuesday’s announcement.
The context of the IPO is important. SpaceX is preparing for a planned Nasdaq listing It is targeting a valuation of $1.75 trillion in June 2026 and growth to $75 billion.
A $60 billion option on the world’s fastest-growing AI developer tool adds narrative and commercial value to that prospect, regardless of whether the option is ultimately exercised.
For Cursor, the deal provides financial certainty, such as $10 billion in near-term cash or a $60 billion exit, for the partnership without requiring an immediate sale. That’s especially notable because Cursor was simultaneously in talks over the weekend to raise $2 billion at a valuation above $50 billion in a separate fundraising round, expected to be co-led by Andreessen Horowitz and with participation from Nvidia and Thrive Capital.
It is unclear whether this round is in addition to or in place of the SpaceX arrangement.
The deal also sharpens the competitive map in AI coding tools. Cursor has previously rejected acquisition offers from OpenAI.
OpenAI’s own response is to move forward with plans to acquire Codex and Windsurf, which have three million weekly users, with 40% of revenue from the enterprise. Anthropic’s Claude Code is the third major player.
SpaceX is now officially entering this market through the existing distribution of the Cursor, rather than building a faster compliance path from scratch at an extraordinary cost.
