Cursor was on track to close a $2 billion funding round this week but chose to halt discussions after SpaceX offered a $10 billion "collaboration fee" and a path to a $60 billion acquisition.

Partnering with Cursor could be a crucial step for Elon Musk to get ahead of AI rivals like OpenAI and Anthropic.

Amid the insatiable demand for computing power, xAI (X.AI) appears likely to rent some of its capacity to artificial intelligence startup Cursor, Business Insider reported. Cursor is likely to train its latest AI model,

Elon Musk's xAI is collaborating with Cursor, which is using xAI's GPUs for model training, people with knowledge of the matter said.

SpaceX subsidiary xAI will rent computing power from its data centers to the coding startup Cursor, Business Insider reported . Cursor plans to use tens of thousands of xAI’s chips to train its latest AI coding model,

The agreement with the coding startup opens the way to a 10 billion dollar partnership or a 60 billion dollar acquisition by the end of 2026. For Elon Musk's group it is not just an industrial agreement,

Cursor, a startup building AI systems that can handle coding tasks, is now turning to Elon Musk's xAI for massive computing power. The move highlights how even automation-first companies still depend heavily on access to large-scale AI infrastructure.