SpaceX to acquire Cursor for $60B in stock, days after blockbuster IPO

In a significant move, SpaceX has reached an agreement to purchase the AI coding startup Cursor for a staggering $60 billion in stock. This announcement follows just days after SpaceX's landmark initial public offering (IPO) and comes less than two months after the two companies revealed their collaboration. The acquisition aims to bolster SpaceX's artificial intelligence division, which is anchored by Elon Musk's AI venture, xAI, that was integrated with SpaceX earlier this year. This strategic acquisition is seen as essential for SpaceX to enhance its capabilities and compete with leading AI laboratories. However, the AI division has faced challenges, including controversies surrounding the generation of non-consensual deepfakes involving women and children. These issues have prompted a restructuring within the division, despite its importance to SpaceX's IPO commitments. During the IPO process, SpaceX highlighted a vast potential market for AI products, estimated at $26 trillion, which is comparable to the entire U.S. GDP. The company announced on Tuesday that it expects the acquisition to finalize in the third quarter of this year. Before the discussions with SpaceX, Cursor was in the process of securing a $2 billion funding round from prominent investors including Andreessen Horowitz, Thrive, and Nvidia, which would have positioned the startup at a valuation of $50 billion, according to TechCrunch. Notably, SpaceX had previously offered a unique arrangement: it would either acquire Cursor for $60 billion in stock or incur a $10 billion fee if the deal did not proceed. This story is still evolving, and further updates are anticipated.