Musk's SpaceX Denies Cognition Acquisition Talks, but AI Coding M&A Heats Up

A Bloomberg report claiming that SpaceX attempted to acquire AI coding startup Cognition was quickly denied by Cognition CEO Scott Wu, who posted on X that the story was "inaccurate" and that Cognition "is not for sale." Wu added that the two companies haven't been in talks. The report surfaced just days after SpaceX closed its $60 billion acquisition of Cursor, another AI coding startup, signaling a dramatic consolidation in the AI-assisted coding market.

Cognition, known for its AI coding agent Devin, remains one of the largest independent players in the space, with an enterprise customer base that includes Mercedes-Benz, Citi, and Goldman Sachs. It raised a $1 billion round in May at a $25 billion post-money valuation and is now reported to be in early talks for a new round at a $40 billion valuation. If true, that would be one of the largest funding rounds in the sector.

The denial doesn't address a separate claim in the Bloomberg report: that the companies are still discussing possible collaboration, potentially with Cognition using SpaceX's computing capacity. SpaceX has been selling compute to other AI players, including Anthropic, until it needs that capacity itself. Neither SpaceX nor Cognition responded to TechCrunch's request for comment.

SpaceX has made AI a cornerstone of its growth strategy, especially after acquiring xAI and going public in a blockbuster IPO in June, peaking at a nearly $2.3 trillion market cap. Musk has told employees that AI will represent "99% of the value" of the company in "four or five years," but xAI's products, like the Grok chatbot, have struggled with controversy, including the "MechaHitler" incident and scandals over nonconsensual sexual imagery.

AI coding tools are seen as a clear path to monetization, with Anthropic's Claude Code driving much of its growth. Cursor and SpaceX jointly released Grok 4.6 this month, scoring high on coding benchmarks. Adding Cognition would have given SpaceX another asset in its push for enterprise customers, but with talks reportedly inactive, the startup remains independent—for now.

Cognition itself has been consolidating, acquiring Windsurf's assets last year after Google DeepMind acqui-hired its CEO and top researchers. That deal led to layoffs and strict operational expectations, including an 80-hour workweek, which wouldn't be out of place at a Musk company.

This is a rapidly evolving landscape. Whether or not the acquisition talks were real, the market for AI coding startups is white-hot, and the pressure on independent players like Cognition to join forces with a major model maker or compute provider is only increasing.