Elon Musk’s SpaceX has attempted to acquire AI coding startup Cognition in a bid to catch up with OpenAI, Anthropic and Google in the AI race, Bloomberg reported on Wednesday, citing sources familiar with the matter.
Cognition CEO Scott Wu disputed the report shortly after it was published, writing to X that the article was inaccurate and that Cognition was “not for sale,” adding that the two companies were not negotiating.
The report was released just days after SpaceX acquired Cursor, another AI coding startup, for $60 billion, a deal that closed last week.
SpaceX acquired Musk’s AI company xAI earlier this year. It then went public in June in a massive IPO, and its market capitalization rose to nearly $2.3 trillion at its peak.
SpaceX has pitched its AI ambitions to investors, including eventually building data centers in space. However, the xAI business is still in a relatively early stage and is lagging behind its competitors.
The company has also had to contend with controversial trends in its chatbot Grok, including last year’s “mecha-Hitler” scandal and this year’s non-consensual sex image scandal, as it sought to win over corporate customers.
Musk told SpaceX employees last week that in about “four or five years, AI will be 99% of the company’s value,” but he said SpaceX would need to derive even more revenue from AI to accomplish that feat.
AI-assisted coding has emerged as one of the most obvious ways to monetize technology. Anthropic’s rapid growth, fueled largely by Claude Cord, is proof of that. Bringing Cursor into the fold was part of that equation, and the two companies were already working together before the acquisition was completed. This month, Cursor and SpaceX jointly released Grok 4.6. This is a new model that scores higher on benchmarks for coding and complex multi-step agent tasks.
Adding Cognition and its coding agent, Devin, to an enterprise customer base that includes Mercedes-Benz, Citi, and Goldman Sachs, would give SpaceX new ways to deepen its AI coding efforts and acquire enterprise customers.
Bloomberg reports that while deal talks are no longer active, the two companies are still in talks about working together — potentially using SpaceX’s computing power to work with Cognition, which it sells to other AI players such as Anthropic until it needs it for itself. Wu did not mention this specific allegation in his denial.
Cognition is one of the largest independent AI software coding startups yet to be swallowed up by a large AI model maker. The company raised $1 billion in late May at a post-money valuation of $25 billion, and is currently in early negotiations for a new funding round at a $40 billion valuation, Bloomberg reported.
Cognition made headlines last year when Google DeepMind acquired the startup’s CEO and Top Research in a $2.4 billion deal for talent and licensing rights, followed by the remaining assets of competitor Windsurf.
After the merger, Cognition laid off 30 employees and offered Windsurfing’s remaining 200 employees a buyout. Those who decided to stay faced tough job expectations, including working more than 80 hours a week and spending six days in an office.
This kind of wartime work ethic wouldn’t be out of place at Musk’s company. Musk said he works up to 120 hours a week, often sleeping on the floor of an office or factory.
SpaceX and Cognition did not respond to requests for comment.
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