SpaceX Just Bought Cursor for $60 Billion (and What It Says About AI)

A 60 Billion Dollar Deal

On Tuesday, SpaceX signed a deal to buy Anysphere, the company behind the AI coding tool Cursor, for 60 billion dollars. The whole thing is being paid in SpaceX stock rather than cash, and the company expects the deal to close later this year. Cursor will become a wholly owned part of SpaceX.

The timing is remarkable. SpaceX only went public the previous Friday, raising about 75 billion dollars in the biggest IPO ever. It had a window to decide on this purchase and took just two trading days to pull the trigger. The price makes it the largest acquisition of an AI coding company on record.

Why Buy a Coding Startup?

SpaceX merged with Musk's AI company, xAI, earlier this year, but xAI's coding tools have struggled to catch on. Buying Cursor instantly hands it a polished product with more than a million paying users and one of the strongest footholds in AI coding, the very area where AI is already making real money from businesses.

Founded in 2022, Cursor grew at a blistering pace, helping popularize what people now call "vibe coding," where you describe what you want and the AI writes much of the software for you. The company recently reported around 2.6 billion dollars in annual revenue, which helps explain the eye-watering price tag.

The Magic of a High Stock Price

Here is the clever part. Because SpaceX paid in its own stock, and because its share price has soared since the IPO, the 60 billion dollar deal only cost it a small slice of the company, a dilution of about 3.4 percent. Investors liked it: SpaceX shares jumped around 16 percent on the day, briefly pushing it past Amazon and Microsoft to become one of the most valuable companies in the US.

As investor Bill Ackman put it, one of the things that makes SpaceX so valuable is how valuable it is. A towering stock price turns acquisitions into a relative bargain, because you are paying with expensive shares instead of cash. It is a reminder of how much leverage a hot valuation gives a company.

A Twist for Anthropic and OpenAI

There is an awkward wrinkle. Many developers use Cursor specifically so they can run their code through models from Anthropic and OpenAI, SpaceX's direct rivals. Cursor even recently signed cloud deals worth roughly 26 billion dollars combined with Anthropic and Google. Now that SpaceX owns Cursor, there is a clear temptation to nudge users toward its own Grok models instead.

It is also a competitive jolt. Cursor's market share had slipped from about 41 percent a year ago to roughly 26 percent, with Anthropic taking a big chunk of that category. The deal could reshape who controls the tools millions of programmers use every day, which is why it has the whole industry watching.