Musk's SpaceX buys AI coding start

Musk's SpaceX buys AI coding start-up for $60bn days after IPO

SpaceX has agreed to buy AI coding start-up Cursor for $60bn (£45bn) just days after its bumper initial public offering (IPO).

Elon Musk's rocket company will take over Anysphere, which makes the artificial intelligence coding agent.

The move comes after SpaceX joined New York's tech-focused Nasdaq stock exchange on Friday in the biggest ever listing, valuing it at more than $2tn and raising $85.7bn.

A surge in SpaceX's share price on Monday and Tuesday saw the company overtake Amazon to become the world's fifth most valuable company.

SpaceX and Cursor have been partners since April, when Musk's firm announced it had the right to either buy it for $60bn, or pay $10bn for the work they have done together.

Like OpenAI and Anthropic, Cursor's technology uses AI to automate the process of writing code, one of the most prominent current uses for artificial intelligence.

Its tie-up with SpaceX comes as Musk's company tries to catch up with rivals by growing its AI business, xAI, which is behind the controversial Grok chatbot.

Announcing the partnership in April, SpaceX said: "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."

Cursor is used by major companies including Stripe, Adobe and Nvidia, whose boss Jensen Huang has described it as his "favourite enterprise AI service".

SpaceX said the deal would be completed by the end of September, with Cursor's shareholders paid with $60bn worth of SpaceX shares.

SpaceX's shares have soared by almost two thirds from their $135 offer price, including a bumper first full day on the public markets.

Its market value is now $2.9tn, above Amazon's $2.7tn but lagging Microsoft, Apple, Google owner Alphabet and Nvidia.

The company's listing also made Musk the world's first trillionaire, sparking a debate about inequality and wealth taxes.

SpaceX's valuation is largely based on optimism about its potential future earnings, as opposed to financial results it has demonstrated so far.

It is currently not profitable, meaning it loses more money from its operations than it makes.

The company has lost a total of $9bn over 2025 and 2026 so far, according to its financial filings, due to its huge spending on AI and other infrastructure investments.

The biggest focus of its business is the manufacture and launch of rockets with reusable parts.

SpaceX also manufactures and launches Starlink internet satellites, and through this year's acquisition of xAI, another company Musk owned and operated, it entered into the AI business too.