Musk’s SpaceX Targets AI Dominance with $60 Billion Cursor Deal

SpaceX has struck a deal with AI coding tool Cursor, giving SpaceX the right to acquire the startup for $60 billion or enter a $10 billion collaborative partnership. The newly formed 'SpaceXAI' entity aims to challenge OpenAI and Anthropic by combining Cursor's Composer model and developer workflow with SpaceX's Colossus supercomputer (equivalent to one million NVIDIA H100 chips) and xAI foundation models. Cursor's valuation has surged from $2.5 billion at the start of 2025 to $29.3 billion after a Series D round. The deal supersedes a previously reported $2 billion funding round led by Andreessen Horowitz and NVIDIA. Analysts note this mirrors vertical integration strategies already seen with OpenAI/Microsoft and Google, raising concerns about vendor lock-in for enterprises adopting AI coding agents.