SpaceX gets option to buy AI coding firm Cursor for $60B

SpaceX secured an option to buy AI coding startup Cursor for $60 billion later this year, or to enter a $10 billion working partnership, the companies announced on X as SpaceX prepares for an initial public offering.

Cursor, a unit of Anysphere, was co-founded in early 2022 by four MIT students: Michael Truell, Aman Sanger, Sualeh Asif and Arvid Lunnemark. The company builds AI tools that help software developers write code more quickly and released its first product in March 2023. By late 2023 Cursor had indexed thousands of codebases for its platform.

Funding and valuation grew rapidly. Cursor raised a $60 million Series A in June 2024 led by Andreessen Horowitz, then completed three additional rounds through 2025 totaling $3.3 billion. Its valuation rose from about $2.5 billion at the start of 2025 to roughly $29.3 billion after a $2.3 billion Series D in November 2025. A $900 million round in June 2025 had valued the company at about $9.9 billion. The company is in talks to raise another $2 billion at a valuation above $50 billion, with Andreessen Horowitz, Thrive Capital, Nvidia and Battery Ventures expected to participate.

Revenue tracked the financing growth. Cursor reported annualized revenue of $500 million in May 2025, $1 billion by October 2025 and more than $2 billion by February 2026. The company says 67% of the Fortune 500 use its tools, and that its platform generates roughly 150 million lines of enterprise code per day. Nvidia CEO Jensen Huang, an investor, described Cursor as his “favorite enterprise AI service,” noting heavy internal use of AI coding tools across the company.

Competition has intensified. Anthropic introduced Claude Code as a research preview in February 2025; that product writes larger blocks of code autonomously and reached an estimated $2.5 billion annual run rate with over 300,000 business customers by early 2026. Boris Cherny, head of Claude Code, said, “We invented agentic coding as a thing.” Some customers have reduced their use of Cursor, and at least one startup publicly moved off the platform earlier this year.

Cursor faces model access and cost pressures because it currently pays open-market rates to use models from competing firms. To reduce dependence, Cursor has been training its own model, Composer, since 2025. Cursor reports Composer outperformed Anthropic’s Opus 4.6 on some benchmarks, while Composer 2 trailed OpenAI’s GPT 5.4 on others. A company post said model training had been “bottlenecked by compute,” and the SpaceX agreement would allow Cursor to scale model training on xAI’s Colossus supercomputer cluster in Memphis.

SpaceX has moved quickly on several fronts. The company filed IPO paperwork in early April, plans a roadshow in early June and combined with xAI in February in a transaction valued at $1.25 trillion. SpaceX is seeking a $1.75 trillion valuation for the combined business and reported $24.7 billion in cash at the end of 2025.

Cursor CEO Michael Truell described the agreement as “a meaningful step on our path to build the best place to code with AI.” Martin Casado, a general partner at Andreessen Horowitz and a Cursor board member, called the startup’s rise unusually rapid, noting its growth when measured against dollars invested. It remains unclear whether SpaceX will exercise the $60 billion purchase option, proceed with the $10 billion partnership or choose another path. Truell has said he aims to build a durable business amid fast-changing product and competitive conditions.