SpaceX’s Latest Bet Has Nothing to Do With Rockets

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Elon Musk’s Space Exploration Technologies (NASDAQ:SPCX) finally inked the deal to acquire AI coding agent Cursor, a move that was rumored well before SpaceX had its IPO. The $60 billion deal adds yet another valuable piece to the already impressive AI arsenal. Whether it’s enough to help SpaceX push Grok to catch up in the AI race, though, is another question entirely.

While space exploration, Mars, and the prospect of robots on the Moon are exhilarating and enough of a reason to punch a ticket at more than $200 per share, I do think that Cursor and the wave of AI monetization might be what transforms the company from a speculative moonshot to a serious investment with a front-row seat to the AI revolution.

At the time of this writing, SpaceX has just topped Amazon (NASDAQ:AMZN) to become the world’s fifth-largest company. And it feels like Nasdaq fast-track plans aren’t fast enough to get in on these first few days of gains. Indeed, whether or not SpaceX is included after the feast, right before the indigestion sets in, remains the big question. In any case, the meme-like price action on an absolute colossus of a company is nothing short of remarkable.

Meanwhile, Elon Musk’s net worth just keeps climbing, now close to $1.3 trillion, just days after being minted the world’s very first trillionaire. Indeed, it did not take long to add another couple of hundred billion after the milestone was hit.

As options trading opens up, I’m sure many will be tempted to place their bets in either direction. Michael Burry said that he’s tempted but has passed, a wise move in my view, especially considering the scorching momentum, which, at this pace, might just take SpaceX above other Mag Seven companies in the $2.8-3.0 trillion club.

The Cursor deal was a major win for SpaceX

In any case, the latest Cursor deal, I think, is a huge win for both sides, especially given the sheer magnitude of disruption behind something like a Claude Code or a GitHub Copilot. While $60 billion is a pretty penny to pay, I do think that the all-stock deal reserves a fantastic seat in what could be one of the most promising parts of the AI revolution as the race to recursive self-improvement (RSI) moves onward.

AI-driven coding may very well be the key to profound monetization in AI. Just look at how quickly something like Cursor was adopted by coders across the industry. It exploded in popularity for a reason; it’s a disruptive tool that’s creating serious ROI for its users.

In any case, the Cursor deal seems to suggest that Elon Musk knows the stakes in the AI race and what it takes to win. But whether this alone justifies paying more than 130 times price-to-sales (P/S) is another question entirely.

That’s an unbelievably expensive multiple for any company, regardless of the narrative or trajectory. But, then again, what if Cursor winds up being one of the building blocks needed to get on the path to RSI? Either way, it’s hard not to be that much more bullish on SpaceX after bringing Cursor under its wing. RSI is perhaps one of the concepts that’s more exciting than space itself.

Making big strides in the AI talent wars

Beyond the fantastic AI-first coding editor, SpaceX is bringing some of the most exceptional talent in the AI scene on board. Indeed, premier AI talent, like those at Cursor, ought to come at a premium. In any case, count Cursor as another exceptional addition to SpaceX’s already mouth-watering stack of AI assets. It’ll be interesting to see where Cursor’s growth goes now that compute is no longer an issue.

From Colossus at the compute level to Grok in the intelligence layer, and now Cursor in the intelligence and application layer, it feels like SpaceX is shaping up to be quite the force in AI just as it is in space. For SpaceX, perhaps AI, which is the source of tremendous CapEx today, could be the immensely profitable business that helps keep the space business shooting for the stars.

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