SpaceX has secured an option to acquire AI startup Cursor for $60 billion later this year or form a new partnership with Cursor worth $10 billion. This move comes as the company prepares for its highly anticipated public debut, targeting a valuation of close to $1.75 trillion and a $75 billion fundraise, which could make it the largest initial public offering in history.
Key Takeaways
SpaceX has secured an option to acquire AI startup Cursor for $60 billion or form a partnership worth $10 billion ahead of its anticipated IPO. This move highlights SpaceX's push into AI and automation.
- SpaceX targets a valuation close to $1.75 trillion in its upcoming IPO, which could be the largest in history
- Cursor is reportedly raising a $2 billion funding round at over a $50 billion valuation
- Microsoft considered acquiring Cursor before SpaceX's deal but chose not to proceed
The deal underscores SpaceX's push into AI and automation, leveraging Cursor's expertise in automating coding processes. According to multiple reports, SpaceX highlighted the potential of combining Cursor’s leading product with its Colossus training supercomputer, touted as the largest in the world. This combination is expected to allow for building 'the world’s most useful models.'
SpaceX's announcement comes amid a series of strategic moves ahead of its IPO. The company is hosting analysts for three days of closed-door meetings at its launch facility in Texas and mega-sized data center in Tennessee, kicking off with an all-day meeting and analyst tour on Tuesday at the satellite and rocket maker's Starbase launch facilities in Boca Chica.
As reported by Reuters Breakingviews, SpaceX aims to be worth $1.75 trillion when it sells shares to public investors. However, the company's revenue exceeded $18 billion last year while making a net loss of $5 billion, according to The Information. Additionally, Cursor is in talks to raise a $2 billion funding round at a valuation of over $50 billion, with Andreessen Horowitz set to co-lead the new investment round.
The rocket and satellite company disclosed plans that would entrench permanent voting control for founder Elon Musk as part of its IPO preparations. SpaceX is targeting a late-June market debut, even as excerpts from its confidential IPO filing show the company swung to a multi-billion-dollar loss in 2025, driven by heavy spending on artificial intelligence.
Prior to SpaceX's announcement, Microsoft considered acquiring Cursor but chose not to proceed with a bid. According to CNBC, two people familiar with the matter revealed that Microsoft was looking at a potential deal for the AI coding startup before SpaceX secured the option. Microsoft has gained traction among developers with GitHub Copilot but is currently being outpaced by Cursor in the AI coding market.
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