Technology and Science19 August, 20262 min read
SpaceX Talks To Acquire AI Coding Startup Cognition Stalled, Compute Partnership Continues
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Talks to acquire Cognition AI stalled; no deal reached. Compute partnership under discussion; Cognition to access SpaceX computing capacity.
6 outlets told this the same way.
Deal Talks Stall
SpaceX’s attempt to acquire AI coding startup Cognition AI Inc. stalled without a deal, according to people familiar with the matter, and the approach would have been SpaceX’s second major AI takeover in recent months. The deal talks are no longer active, but the two companies continue discussing a compute partnership instead, letting Cognition use SpaceX’s computing capacity. Cognition, founded in 2023, builds Devin, an AI agent designed to automate programming tasks for software engineers, and it was valued at $26 billion in a May funding round.
Cognition Chief Executive Officer Scott Wu said in May that the company’s funding round “allows us to stay independent and continue as an independent business, which is really important for us.” SpaceX’s stalled Cognition effort contrasted with its $60 billion Cursor acquisition, which closed on August 14 and gave Musk’s rocket firm a rival AI coding platform outright.
Wu Denies, Bloomberg Cites
Cognition CEO Scott Wu publicly denied the report, writing that his company is “not for sale and we haven’t been talking,” as SpaceX approached Cognition about buying it, according to Bloomberg. The denial arrived the same day as the report and went further than the account, with Bloomberg describing an approach that was not taken up alongside continuing discussions about working together, including a possible arrangement for Cognition to use SpaceX’s computing capacity. Cognition raised $1bn at a $26bn valuation in May and was in early talks with investors this month at a valuation of at least $40bn.
TechCrunch reported that Wu disputed the report soon after it published, writing on X that the story was inaccurate and that Cognition “is not for sale,” adding that the two companies haven’t been in talks. TechCrunch also said Bloomberg reported the deal talks are no longer active, but that the companies are still discussing working together, potentially with Cognition using SpaceX’s computing capacity.
Compute Partnership Stakes
The compute partnership option would keep Cognition from being bought outright while still tying its operations to SpaceX’s infrastructure, with one possibility being that Cognition could use part of SpaceX’s computing capacity. KuCoin said SpaceXAI has lagged competitors in selling AI tools to businesses and has cut jobs while restructuring around the effort, while the people familiar with the matter said Cognition’s partnerships with Mercedes-Benz Group AG and GE Aerospace added business weight SpaceXAI wanted. The Next Web framed the compute talks as the part worth watching, warning that if Cognition ends up renting SpaceX’s GPUs, a company that refused to be bought becomes dependent on the infrastructure of the company that tried.
TechCrunch added that Wu didn’t address a specific claim in his denial, while Bloomberg reported that SpaceX is selling computing capacity to other AI players like Anthropic until it needs that capacity for itself. KuCoin said SpaceX shares have been volatile since the June initial public offering (IPO), closing as low as $108.27 in early August before rebounding above its $135 offering price, with shares traded at around $139 ahead of a share unlock covering about 319 million shares.