Just days after its stock market debut, Elon Musk’s rocket company SpaceX has overtaken Amazon to become the world’s fifth most valuable company, briefly reaching a valuation of $2.97tn. The surge came as SpaceX announced it was buying the AI coding start-up Cursor for $60bn, fuelling investor enthusiasm for Musk’s vision of sending AI data centres to space and colonising Mars. But the move has also raised questions about whether the market is pricing in fantasy rather than financial reality.
SpaceX first sold shares to the public at $135 each on Friday 12 June 2026, in the biggest public listing ever. By the following Tuesday, the stock had risen more than 50%, pushing the company’s market capitalisation past Amazon’s $2.66tn. At one point it even briefly surpassed Microsoft before easing back. The float alone raised $85.7bn and made Musk the world’s first trillionaire, with a net worth of $1.3tn according to Forbes.
“Explains SpaceX's IPO, its $60bn Cursor deal, and why it overtook Amazon despite big losses.”
The Cursor acquisition is central to the excitement. Cursor, owned by San Francisco-based Anysphere, makes an AI-powered coding tool that automates the writing of software code – one of the most commercially successful uses of artificial intelligence so far. SpaceX said in April it had secured the option to either buy Cursor for $60bn or pay $10bn for a partnership. It chose to buy, giving its AI business xAI access to Cursor’s more than 1 million users and a fast path into enterprise AI. The hope is that this could be SpaceX’s “Instagram moment”, akin to Facebook’s transformative acquisition of the photo-sharing app.
Yet the financial fundamentals tell a different story. While Amazon posted revenues of $717bn and net income of $78bn in 2025, SpaceX lost $4.9bn on revenues of just $18.7bn. Even Starlink, the only profitable part of the business, is still small compared with Amazon’s retail empire. Investors appear to be betting not on current profits but on what SpaceX might achieve in future: reusable rockets, thousands of internet satellites, and a leading role in the AI race. Venture capitalist Eileen Burbidge told the BBC that many traders seem to be buying into a “well-marketed opportunity” to invest in Musk and his vision rather than in SpaceX’s financial fundamentals.
For UK readers, the story matters in several ways. First, it illustrates the immense market power and hype surrounding Elon Musk’s businesses, which now include X (formerly Twitter) and Starlink. Musk has taken an increasing interest in UK politics, drawing criticism from the Prime Minister for his views and for the way X influences public debate. Second, the Cursor deal highlights how the UK’s tech sector – especially AI and coding tools – is part of a global race that is reshaping valuations. Third, the gap between market value and real earnings serves as a cautionary tale for anyone tempted to follow the hype: only around 4% of SpaceX’s shares are freely traded, meaning smaller shareholders could “end up paying a premium for stock now that gets diluted later” if big investors eventually sell.
Q: Why did SpaceX’s share price jump so much after the IPO? A: The jump was driven by the announcement that SpaceX would buy AI coding start-up Cursor for $60bn, plus strong investor demand for a slice of Musk’s vision. The IPO was massively oversubscribed, and with only 4% of shares freely trading, the price rose quickly from $135 to over $200.
Q: How can a company that loses billions be worth trillions? A: Market capitalisation is based on the share price multiplied by total shares, which reflects what investors expect the company to earn in the future – not its current profits. SpaceX lost $4.9bn in 2025, but investors are betting on its long-term potential in rockets, satellites, and AI.
Q: What does the Cursor acquisition mean for the AI industry? A: Cursor’s AI coding tool is already used daily by over 1 million professional developers. By owning it, SpaceX’s xAI can compete more directly with rivals like Anthropic and OpenAI in the fast-growing market for AI that writes code. The $60bn price tag shows how valuable such tools have become.
What happens next? SpaceX’s share price may remain volatile as the market digests its huge valuation. Analysts will watch whether the Cursor deal helps xAI close the gap with leading AI models. The company also faces the challenge of turning its visionary projects – from Mars missions to space-based data centres – into real revenue. Meanwhile, Musk’s growing political influence, including in the UK, is likely to keep the company in the headlines.