SpaceX is currently preparing for the largest initial public offering (IPO) in the company’s history. The company is expected to go public in June, with a valuation between 1.75 trillion and 2 trillion U.S. dollars, and the first round of public fundraising is projected to bring in approximately 750 billion dollars. According to recent information, SpaceX may ultimately use most of its IPO proceeds to acquire an artificial intelligence coding expert company. The company has signed an agreement allowing it to either acquire Cursor, a developer of AI coding tools, for 60 billion dollars, or purchase its services for 10 billion dollars in exchange for cooperation between the two parties. SpaceX’s stock ticker will be announced upon its official listing.
SpaceX CEO Elon Musk stated that the two companies are collaborating to “build the world’s best AI for coding and knowledge work.” SpaceX is best known for its rocket launches and Starlink internet services, but artificial intelligence is becoming a key component of its growth strategy. Earlier this year, Musk planned to merge his xAI company with SpaceX. Cursor’s core product is Composer, an AI software coding tool that helps developers test code and generate documentation. Whether acquiring the company at a 60-billion-dollar valuation or purchasing its services for 10 billion dollars, both options represent a vote of confidence in Cursor’s technology and a significant step for Musk’s companies in the AI race.
Although xAI holds a strong position in many aspects of the AI competition, it still lags behind Anthropic’s Claude and OpenAI’s Codex in some key areas. By partnering with Cursor, Musk aims to enhance SpaceX’s competitive edge in the AI field. According to sources, SpaceX is more likely to directly acquire Cursor than to pay 10 billion dollars for its services. As SpaceX is preparing for its IPO, it needs to resubmit key information documents related to its listing, which could lead to a delay in the IPO. Sources suggest that the 10 billion dollars is essentially a termination fee if the acquisition does not go through. Given the size of the termination fee relative to the 60-billion-dollar acquisition price, SpaceX holds an extremely optimistic view of Cursor’s capabilities.
Some investors and analysts speculate that after SpaceX goes public, Musk might at some point push for a merger between Tesla and SpaceX. Tesla’s (TSLA) electric vehicle, robotaxi, and Optimus humanoid robot businesses could potentially integrate with SpaceX and xAI operations. Even if the two companies do not ultimately merge, there could be substantial business cooperation in the future, with Cursor’s technology potentially being widely applied.
SpaceX is presenting investors with a growth path that differs from the traditional aerospace narrative. Its biggest future opportunity is not spacecraft transportation or satellite internet, but AI services targeting enterprise customers. According to media reports citing IPO documents, SpaceX estimates its total addressable market at 28.5 trillion U.S. dollars, of which more than 90% is related to artificial intelligence, with approximately 22.7 trillion dollars directly corresponding to the enterprise customer market.
Analysts believe that SpaceX is attempting to tell a capital market story of an “AI infrastructure platform” rather than just an “aerospace company.” However, the market is not without doubts about this valuation logic. Some observers argue that SpaceX’s existing business fundamentals alone may hardly support such an ultra-high valuation. Whether the company’s IPO succeeds will largely depend on market confidence in Musk’s AI vision.
