SpaceX and Cursor: A $60 Billion Option Play

The biggest story of the day is SpaceX partnering with Cursor to "create the world's best coding and knowledge work AI." The deal gives Cursor—whose agentic coding model Composer 2 operates at frontier-level performance—access to compute from SpaceX's Colossus supercomputer (the million H100-equivalent facility). But the structure is what makes it remarkable.

Richard Wu broke down the deal mechanics: XAI has been struggling to train a state-of-the-art coding model (hence co-founder departures) and may have idle GPUs. Cursor doesn't have capital for a $5 billion training run to compete with Codex and Claude. So XAI told Cursor: use all the GPUs you want at cost and get to a state-of-the-art coding model, as long as we have the option to buy you. Cursor gets a free option: train a model better than Opus and get bought out for $60 billion, or get $10 billion that pays for all the GPUs they rented. Win-win.