Elon Musk's SpaceX Wants to Buy Pakistani Cofounder's AI Startup for $60 Billion

SpaceX is making a massive $60 billion bet on AI coding startup Cursor as it prepares for what could be one of the largest initial public offerings in history, signaling a major shift from a space-focused company to a full-scale artificial intelligence powerhouse.

The company has secured the option to acquire Cursor later this year for $60 billion, while also entering a $10 billion collaboration to build advanced AI tools for coding and knowledge work.

Cursor, developed by Anysphere, has grown rapidly since its founding in 2022. The company has surpassed $1 billion in annual recurring revenue and is used daily by more than one million developers. Its tools are deeply embedded in enterprise workflows, including adoption across 67 percent of Fortune 500 companies.

While competitors such as OpenAI and Anthropic already dominate AI coding tools, xAI lacked a comparable product. For Elon, Cursor provides that missing layer.

The deal goes beyond a simple acquisition option and reflects a broader strategy by SpaceX. It combines powerful computing with a high-demand product, as Cursor generates around 150 million lines of enterprise code daily.

The platform also offers strong distribution through its daily use by professional developers, giving SpaceX access to a large user base. In addition, the deal brings in specialized talent, with Cursor's founders contributing expertise that cannot be replicated through infrastructure alone.

The timing of the deal is closely tied to SpaceX's IPO plans. The company is preparing for a public listing that could value it at well over $1 trillion. Adding a $60 billion AI asset strengthens its growth narrative and positions it as a leader not just in space technology but also in artificial intelligence.

SpaceX is increasingly focused on controlling the full AI stack, from computing infrastructure to developer platforms. Plans to expand its Colossus system and potentially move data centers into orbit further highlight its ambition to integrate space and AI technologies.