Elon Musk's SpaceX has reportedly completed a $60 billion (£45 billion) acquisition of the AI coding start-up Cursor, a move that has further propelled the aerospace and AI company's market valuation. Following a robust post-IPO performance, SpaceX's market capitalisation has now surpassed that of Amazon, making it the fifth-largest listed company globally. This development underscores the escalating investment and competition within the artificial intelligence sector.
Shares in SpaceX reportedly surged over eight per cent in pre-market trading, extending a rally that has seen the stock climb more than 50 per cent since its record-breaking flotation last week. This surge pushed SpaceX's market value to approximately $2.75 trillion (£2.05 trillion), exceeding Amazon's $2.66 trillion valuation. The company is now reportedly within striking distance of Microsoft, which currently holds a valuation of around $2.95 trillion. This extraordinary market debut has added nearly $1 trillion in market value to SpaceX in a matter of days, reflecting strong investor confidence in Musk's long-term vision for AI and space infrastructure.
The acquisition of Cursor, founded in 2022 as Anysphere, is an all-stock transaction valued at $60 billion. Cursor has rapidly grown by developing AI tools designed to assist programmers with writing, editing, and debugging code. These AI coding assistants have emerged as one of the significant commercial successes of the generative AI boom, attracting millions of users and driving substantial enterprise revenues. Major companies such as Stripe, Adobe, and Nvidia are among Cursor's reported clientele, with Nvidia CEO Jensen Huang reportedly describing it as a 'favourite enterprise AI service'.
SpaceX and Cursor have reportedly been collaborating since April, when an agreement was announced giving SpaceX the option to acquire Cursor or pay a break fee. SpaceX indicated that integrating Cursor's software with its extensive computing infrastructure would accelerate the development of advanced AI models. This acquisition is also expected to provide a considerable boost to xAI, Musk's AI business responsible for the Grok chatbot, which merged with SpaceX earlier this year. Despite its positioning as a key growth engine, xAI has faced challenges, including criticisms regarding content generation and internal restructuring.
Despite its immense valuation, SpaceX has reported significant losses, exceeding $9 billion across 2025 and 2026, as it heavily invests in artificial intelligence infrastructure, data centres, and computing capacity. While the company is widely recognised for its reusable rockets and the Starlink satellite network, a substantial portion of its valuation is increasingly tied to future expectations surrounding AI. IPO filings reportedly indicated that SpaceX foresees a potential $28 trillion addressable market spanning AI infrastructure and enterprise software applications, with approximately $22.7 trillion linked to enterprise AI products and services.
Source: City A.M.