SpaceX has built a working AI hardware prototype that is slimmer than an iPhone and demonstrated it to investors and stakeholders ahead of the company’s record-breaking initial public offering, as reported by the Wall Street Journal. The device runs on a proprietary operating system and uses Qualcomm’s Snapdragon chip to power SpaceXAI technology, the rebranded version of xAI that SpaceX absorbed after Elon Musk merged his AI startup into the rocket company following its June IPO.
SpaceX closed its IPO at $135 per share, raising $75 billion and establishing a $1.75 trillion valuation. Within weeks of going public, SpaceX’s ambitions in AI hardware have moved from abstract to prototype form, though the company has hedged that the device may never reach market. The timing signals SpaceX’s transformation from a launch provider into a diversified AI and technology conglomerate.
SpaceX’s AI consolidation extends well beyond this single prototype. The company agreed to a $60 billion acquisition of Cursor, the agentic coding platform with over a million paying customers and $2.6 billion in annual revenue, with the deal expected to close in Q3 2026. Cursor’s proprietary coding data and user base are now being injected directly into pre-training for Grok 4.3, a 1.5 trillion parameter model jointly developed by SpaceXAI and Cursor engineers. This approach differs markedly from conventional fine-tuning and positions Grok to gain significant advantage in code generation tasks.
The hardware move signals SpaceX’s intent to compete directly in the emerging AI device market. Apple is developing a small wearable AI pin similar in size to an AirTag, while OpenAI is preparing a smart speaker priced between $200 and $300 for launch in February 2027, with Jony Ive leading the design effort. Smart glasses and smart lamps from OpenAI are planned for 2028 or later. SpaceX’s slimmer-than-iPhone form factor suggests the company is betting on a more mobile or portable device category, though the prototype phase leaves uncertainty around whether this becomes a shipping product.
