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Core Scientific, Inc. (NASDAQ:CORZ) ("Core Scientific" or the "Company"), one of the largest owners and operators of high-powered digital infrastructure for bitcoin mining and hosting services in North America, today announced that CoreWeave, the AI Hyperscaler, has exercised its first option to contract for additional infrastructure under the terms of its previously announced 200 megawatt ("MW"), 12-year high-performance computing ("HPC") hosting contracts entered into with CoreWeave on June 3, 2024.
Core Scientific is one of the largest owners and operators of high-powered digital infrastructure for bitcoin mining and hosting services in North America (Photo: Business Wire)
Under the terms of today's announced agreement, Core Scientific will modify a total of 100 MW of its owned infrastructure to deliver approximately 70 MW to host CoreWeave's NVIDIA GPUs for HPC operations. Site modifications are expected to begin in the second half of 2024, with operational status anticipated in the second half of 2025. This new 12-year HPC hosting contract will further increase Core Scientific's exposure to contracted, multi-year, dollar-denominated revenue. From revenue to gross margin, the new contract with CoreWeave is expected to enhance earnings power and drive shareholder value, adding an additional $1.225 billion in projected cumulative revenue over the 12-year contract timeline to the more than $3.5 billion in projected cumulative revenue associated with previously announced contracts with CoreWeave.1
"We are excited to build on our momentum and expand the scope of our HPC hosting business with significant additional infrastructure," said Adam Sullivan, Core Scientific's Chief Executive Officer. "The world is changing, and many data centers built in the last 20 years are not suitable to support future computing requirements. Core Scientific is well positioned to design for the future and build application-specific data centers (ASDCs), which are designed to support much higher rack energy densities across large footprints. Our ASDCs will serve clients such as CoreWeave as they deploy next generation chips with higher densities at scale. We are a hosting provider of choice to our clients because we own our flexible, high-power infrastructure and have a team of highly experienced data center experts who can execute and build rapidly and effectively."
"As demonstrated by our Austin data center, which we delivered to CoreWeave more than 30 days ahead of schedule, we intend to continue to transform and expand our hosting business and our earnings power as we provide valuable capacity to the dynamic and exciting world of AI compute during this transformative time for the industry. We also intend to reinforce our strong bitcoin mining franchise to capitalize on bitcoin's upside potential," Mr. Sullivan added.
Consistent with the terms of the agreements with CoreWeave previously announced on June 3, 2024, all capital investments required to modify Core Scientific's existing infrastructure into cutting-edge, application-specific data centers customized for dense HPC will be funded by CoreWeave. An estimated $105 million of the capital investments associated with the additional contract will be credited against hosting payments at no more than 50% of monthly fees until fully repaid. The new agreement with CoreWeave also provides opportunities for two renewal terms of five years each.
Building on the previously announced 200 MW of infrastructure for HPC hosting, the agreement announced today will position Core Scientific to provide approximately 270 MW of HPC infrastructure to CoreWeave by the second half of 2025. CoreWeave retains optionality for further expansion with an additional approximately 230 MW of infrastructure for HPC hosting at other Core Scientific sites, which if exercised would place Core Scientific among the largest data center operators in the United States.
Posted In: CORZ
