SpaceX says working with Cursor, has option to buy AI startup for $60 bln By Investing.com

Investing.com-- Elon Musk's SpaceX said on Tuesday it is working with Cursor and has been granted the right to acquire the artificial intelligence coding startup later this year for $60 billion.

Alternatively, SpaceX can pay $10 billion for a partnership with the startup, the company said in a social media statement.

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"The combination of Cursor's leading product and distribution to expert software engineers with SpaceX's million H100 equivalent Colossus training supercomputer will allow us to build the world's most useful models," SpaceX said.

SpaceX's announcement comes just a week after a report said xAI- Musk's AI startup that was folded into SpaceX- would rent out its computing power to Cursor, and that the latter would train its most advanced models on xAI hardware.

Last month, two senior engineering heads at Cursor left the startup to join xAI.

A report last month showed Cursor eyeing a $50 billion valuation in a private fundraising round, with the company seen as one of the fastest growing AI coding platforms.

But both Cursor and xAI lag rivals such as OpenAI and Anthropic in producing advanced in-house AI models-- a flaw that the SpaceX tie-up may be aimed at fixing.

AI coding has also emerged as one of the most prominent use cases for the fast-growing technology, with Anthropic seen releasing a slew of coding tools in recent months.

Still, the Cursor acquisition represents a major expense for SpaceX, as it heads for a blockbuster initial public offering later this year. The firm, which recently acquired Musk's xAI, is targeting a valuation of roughly $1.75 trillion while raising $75 billion.