SpaceX buys AI coding start-up Cursor for US$60 billion in race for an edge over Anthropic and OpenAI

SpaceX will move forward with its US$60-billion acquisition of artificial intelligence (AI) start-up Cursor as Elon Musk's space exploration and AI company seeks a competitive edge against rivals Anthropic and OpenAI after its Wall Street debut last week.

SpaceX said in April that it had the rights to buy Cursor, or pay US$10 billion to "work together" with the company.

In a regulatory filing on Tuesday, SpaceX said that Cursor will become a wholly owned subsidiary when the deal closes in the third quarter.

Cursor, made by San Francisco start-up Anysphere, is a popular AI coding assistant. What SpaceX has described as Cursor's wide "distribution to expert software engineers" is likely part of what made it attractive to Musk's company, giving it access to a new customer base.

When it first announced the potential acquisition, Cursor said the partnership with SpaceX subsidiary xAI would enable it to build future AI products using xAI's massive AI data centre complex Colossus, based in Memphis, Tennessee.

Cursor, which started in 2022, helped sparked a trend called ‘vibe coding’, as AI coding assistants have become increasingly capable of doing the work of computer programming.

Cursor competes with other coding tools like Anthropic's Claude Code and OpenAI's Codex, but also has relied heavily on partnerships with those larger AI research companies for the foundations of its technology.

It was Cursor's Composer, combined with Anthropic's Claude Sonnet, that a prominent AI researcher was playing with for weekend projects when he coined the phrase ‘vibe coding’ in early 2025.

SpaceX became a public company on Friday in what is largely considered a successful debut. Shares of the company have jumped since Friday.

-AP