“SpaceXAI and @cursor_ai are now working closely together to create the world’s best coding and knowledge work AI,” SpaceX said in a post on X.
The deal structure gives SpaceX flexibility, allowing it to either proceed with a full acquisition at a $60 billion valuation or compensate Cursor with $10 billion for its role in the collaboration. The option comes as Cursor is pursuing a separate funding round that could value the company at more than $50 billion.
Cursor CEO Michael Truell confirmed the partnership, writing that he is “Excited to partner with the SpaceX team to scale up Composer,” referring to the company’s AI model.
The partnership builds on existing ties between Cursor and Elon Musk’s AI efforts. The startup has been using infrastructure linked to xAI, while two of its senior engineers recently joined Musk’s organization. SpaceX previously merged with xAI earlier this year in a deal valued at $1.25 trillion, creating a combined entity that is expected to pursue a public listing.
For SpaceX, the move strengthens its position in the competitive market for AI coding tools, where rivals include OpenAI’s Codex and Anthropic’s Claude. Cursor currently relies in part on those competing models, highlighting the pressure to develop more independent capabilities.
The agreement comes days before a high-profile legal battle between Musk and OpenAI CEO Sam Altman is set to begin, adding further attention to SpaceX’s expanding role in artificial intelligence.
This analysis is based on reporting from CNBC.
Image courtesy of Unsplash.
This article was generated with AI assistance and reviewed for accuracy and quality.
