SpaceX attempted to acquire Cognition, an artificial intelligence coding startup, as part of Elon Musk's broader push to catch up with competitors like OpenAI and Anthropic in the AI race. However, Cognition CEO Scott Wu disputed the report, stating on X that the company is not for sale and that the two organizations have not been in talks.

The reported acquisition attempt comes just days after SpaceX closed a $60 billion deal to acquire Cursor, another AI coding startup. This aggressive consolidation strategy signals how seriously Musk is taking the artificial intelligence market, even as his xAI division faces challenges in competing with established players.

Why Is Musk Betting So Heavily on AI Coding Startups?

Musk has made it clear that artificial intelligence will become the dominant revenue driver for SpaceX. Last week, he told SpaceX employees that within about four to five years, AI will represent 99% of the company's value, but achieving that goal will require significantly more revenue from AI operations. AI-assisted coding has emerged as one of the clearest paths to monetize artificial intelligence technology, with Anthropic's Claude Code demonstrating explosive growth in this space.

Bringing Cursor into the fold was part of that strategy, and the two companies were already collaborating before the acquisition closed. This month, Cursor and SpaceX jointly released Grok 4.6, a new AI model that scores higher on benchmarks for coding and complex multi-step tasks that require agents, or AI systems that can break down problems and solve them step by step.

What Would Cognition Have Added to SpaceX's AI Arsenal?

Cognition's coding agent, called Devin, combined with its enterprise customer base, would have given SpaceX a significant competitive advantage. The startup counts Mercedes-Benz, Citi, and Goldman Sachs among its clients, representing the kind of high-value corporate relationships that SpaceX needs to establish itself as a serious player in enterprise AI.

Cognition remains one of the largest independent AI software coding startups that has not yet been acquired by a major AI model maker. In late May, the company raised $1 billion at a $25 billion valuation, and Bloomberg reports it is now in early talks for a new funding round at a $40 billion valuation, reflecting investor confidence in the space.

How SpaceX Is Building Its AI Competitive Advantage

• Acquiring Coding Startups: SpaceX has acquired both Cursor and attempted to acquire Cognition to consolidate talent and technology in the high-growth AI coding space.
• Leveraging Computing Infrastructure: SpaceX is selling computing capacity to other AI players like Anthropic until it needs that capacity for its own AI operations, creating revenue while building relationships.
• Releasing Competitive Models: SpaceX has released Grok 4.6, which performs well on coding benchmarks and complex agentic tasks, positioning it as a credible alternative to competitors' offerings.

While deal talks between SpaceX and Cognition are no longer active, Bloomberg reports that the two companies are still discussing potential collaboration, potentially involving Cognition using SpaceX's computing capacity. Cognition CEO Wu did not address this specific claim in his public denial.

The broader context reveals how intensely Musk is pursuing artificial intelligence as a business. SpaceX acquired xAI earlier this year, and the company went public in a blockbuster initial public offering in June, with its market capitalization rising to nearly $2.3 trillion at its peak. However, xAI's Grok chatbot has faced significant challenges, including the "MechaHitler" incident last year and nonconsensual sexual imagery scandals this year, which have complicated efforts to win over enterprise customers.

The competitive pressure in AI coding is intensifying. Cognition itself made headlines last year when it acquired the remaining assets of competitor Windsurf after Google DeepMind acquired the startup's CEO and top researchers in a $2.4 billion deal focused on talent and licensing rights. Following that merger, Cognition laid off 30 employees and offered buyouts to the remaining 200 Windsurf employees, with those who stayed facing strict operational expectations, including an 80+ hour workweek and six days in the office.

For Musk, such demanding work environments are not unusual. He has stated that he works up to 120 hours a week and often sleeps on office or factory floors, suggesting that any company acquired by SpaceX would likely face similar expectations.

The failed acquisition attempt underscores a critical reality in the AI race: the most valuable assets are not just the technology, but the teams and enterprise relationships that come with established startups. As SpaceX continues to pursue its ambition to make AI the core of its business, expect more aggressive moves in the coding and AI infrastructure spaces.