Core Scientific (CORZ) reported a staggering first-quarter loss of $347.2 million, despite an increase in revenue to $115.2 million. This decline in profitability came as the company sold 2,385 bitcoins for $208.3 million while simultaneously writing down $266.5 million in mining-related assets. To cover its capital expenditures and other cash requirements, Core Scientific has relied heavily on the proceeds from its bitcoin sales, which aligns with a growing trend among cryptocurrency miners pivoting towards funding AI data centers.
In a significant financial maneuver, the company successfully closed a $3.3 billion offering of 7.75% senior secured notes. The proceeds from this bond sale are earmarked for the development of data centers and the repayment of a $1 billion term loan facility, highlighting a strategic shift from traditional cryptocurrency mining to AI-focused operations.
Colocation revenue, which involves providing space and services for data management, surged to $77.5 million from just $8.6 million a year prior. This area of the business has positioned itself as Core Scientific’s largest revenue source. Conversely, crypto mining revenue saw a sharp decline, dropping to $30.1 million from $67.2 million in the same quarter last year. This downturn is attributed to a 45% decrease in bitcoins mined and an 18% fall in the average price of bitcoin.
As of the end of March, Core Scientific operated 10 data centers across seven states in the U.S., boasting approximately 1.9 gigawatts (GW) of gross utility power capacity and 1.3 GW of leasable customer power capacity. Notably, the firm’s first high-density colocation contract with CoreWeave has been expanded to accommodate 590 megawatts (MW) of leased customer power. Following a planned expansion in February 2025, this partnership is expected to enhance projected revenue to $10.2 billion over a twelve-year period.
However, customer concentration has become a growing concern, with one colocation customer accounting for 67% of total revenue in the first quarter—up from just 11% the previous year. This heavy reliance on a single client raises questions about the company’s revenue stability.
Core Scientific’s move toward artificial intelligence infrastructure has drawn investor attention, particularly following the unsuccessful $9 billion all-stock takeover bid for CoreWeave. After emerging from Chapter 11 bankruptcy in 2024, the company has since become emblematic of the trend where bitcoin miners seek to monetize their power resources through contracted AI infrastructure revenue.
At the close of March, Core Scientific reported having $1.04 billion in liquidity, which included $1.01 billion in cash and $37.3 million worth of bitcoin. As the company navigates through its strategic transitions, its future performance will be closely watched by investors and industry analysts alike.
