Hajra Naz
Elon Musk’s SpaceX reportedly attempted to acquire Cognition, an AI coding startup. This move fits into a greater effort. SpaceX is working to catch up with OpenAI, Anthropic, and Google in the broader AI race. Bloomberg reported this news on Wednesday. The report cited sources familiar with the matter.
Cognition CEO Scott Wu disputed this report shortly after it was published. He wrote directly on X, calling the story inaccurate. He stated clearly that Cognition “is not for sale.” He also added an important detail. According to Wu, the two companies haven’t been in talks at all.
This report comes just days after another major SpaceX deal. The company completed a $60 billion acquisition of Cursor. That’s another AI coding startup. The deal officially closed last week.
SpaceX has been expanding aggressively in AI recently. The company acquired Musk’s AI venture, xAI, earlier this year. SpaceX then went public through a blockbuster IPO in June. At its peak, the company’s market capitalization rose to nearly $2.3 trillion.
SpaceX has pitched investors on ambitious AI goals. That includes eventually building data centers in space. Still, the xAI business remains relatively early-stage. It has fallen behind several key competitors in the space.
Read More: Elon Musk Predicts AI Will Eventually Be 99% of SpaceX’s Value
The company has also dealt with ongoing controversy. Its chatbot, Grok, has generated repeated backlash. That includes last year’s widely criticized “MechaHitler” incident. It also includes this year’s scandals involving nonconsensual sexual imagery. These controversies have complicated the company’s efforts. SpaceX has been trying to win over enterprise customers despite them.
Last week, Musk addressed SpaceX employees directly. He said that within four or five years, AI could represent 99% of the company’s total value. However, achieving that outcome requires something significant. SpaceX will need to generate far more revenue from AI specifically.
AI-assisted coding has become one of the clearest paths to monetizing this technology. Anthropic’s rapid growth proves this point well. Much of that growth has been fueled by Claude Code. Bringing Cursor into SpaceX’s portfolio was part of this same strategy. Notably, the two companies were already collaborating before the acquisition closed. This month, Cursor and SpaceX jointly released Grok 4.6. This new model scores higher on benchmarks. That includes coding tasks and complex, multi-step agentic work.
Read More: SpaceXAI launches Grok Bot to help AI agents do your daily tasks
Adding Cognition, along with its coding agent Devin, would have expanded SpaceX’s reach further. Cognition also brings a strong enterprise customer base. That includes companies like Mercedes-Benz, Citi, and Goldman Sachs. Acquiring Cognition would have given SpaceX another route. It could have deepened the company’s push into AI coding. It also would have strengthened competition for enterprise customers.
According to Bloomberg, formal deal talks are no longer active. However, the two companies are reportedly still discussing potential collaboration. One possibility involves computing capacity. Cognition could potentially use SpaceX’s compute resources. SpaceX has been selling that capacity to other AI companies, including Anthropic. It plans to do so until SpaceX needs that capacity for itself. Notably, Wu didn’t directly address this specific claim in his public denial.
Cognition remains one of the largest independent AI coding startups still standing. It hasn’t yet been acquired by a major AI model developer. The company raised a $1 billion funding round in late May. That round valued Cognition at $25 billion post-money. According to Bloomberg, the company is now in early talks for additional funding. Reports suggest a potential new valuation of $40 billion.
Read More: SpaceX Doubles Revenue Through Anthropic, Google AI Compute Deals
Cognition made headlines last year for a different acquisition. The company acquired the remaining assets of competitor Windsurf. That deal came after Google DeepMind hired away Windsurf’s CEO and top research talent. That earlier deal was valued at $2.4 billion, covering talent and licensing rights.
Following the Cognition-Windsurf merger, Cognition laid off 30 employees. The company also offered buyouts to the remaining 200 Windsurf employees. Those who chose to stay faced demanding expectations. That included workweeks exceeding 80 hours. It also included a requirement of six days in the office.
This kind of intense work culture wouldn’t feel out of place at a Musk-led company. Musk himself has claimed he works up to 120 hours a week. He has also said he frequently sleeps on office or factory floors.
