SpaceX is acquiring Cursor, an AI coding tool, for $60 billion in an all-stock deal, marking a significant move in the AI landscape. Cursor was a pioneer in integrating large language models into an IDE, but its market share has slipped with the rise of competitors like Anthropic’s Claude Code. Despite revenue growth, Cursor struggled to break even and was limited by compute resources, which xAI addressed with a deal earlier this year. The acquisition comes on the heels of SpaceX’s IPO and merger with xAI, and will likely boost Cursor’s capabilities. Why it matters: this deal signals a major consolidation in the AI coding tool space and highlights the importance of access to compute resources for AI startups.