Core Scientific partners with AMD to transition from bitcoin mining to AI infrastructure, securing significant capacity leases and revenue prospects.
Core Scientific has entered a transformative partnership with Advanced Micro Devices (AMD), pivoting its focus from bitcoin mining to developing AI infrastructure. The collaboration includes long-term leases for 529 megawatts (MW) of AI capacity, expected to generate over $14 billion in contracted revenue.
New AI Capacity to Launch by 2027
This new capacity is set to support AMD’s customer projects beginning in 2027. Additionally, AMD has the option to acquire up to 1.9 gigawatts (GW) more by December 2028, potentially increasing total capacity to 2.5 GW.
According to filings, AMD has already secured 377 MW across Core Scientific’s facilities in Texas and Oklahoma. An unnamed cloud provider has also committed to 152 MW in locations in Alabama and Georgia through AMD's facilitation.
The partnership also involves collaboration on data center design and integration of AMD’s technology, including its Instinct graphics processing units and EPYC processors. AMD has gained warrants for up to 30 million shares of Core Scientific at a strike price of $23.47 per share, with a portion of these warrants vesting immediately.
This strategic move expands Core Scientific’s total leased capacity to approximately 1.1 GW, equating to a potential revenue exceeding $24 billion. As of mid-July, the company had billed for 437 MW, contributing roughly $635 million in annualized colocation revenue.
The shift towards AI infrastructure comes as Core Scientific navigates declining bitcoin mining profitability, with colocation services generating $136.7 million, or 83% of its total revenue of $164.2 million for the last quarter. In contrast, revenues from self-mining dropped significantly, falling 66% to $21.5 million.
Additionally, the company has ended its agreement with Block for the purchase of mining chips, incurring a $41.9 million charge. This deal originally involved 3-nanometer chips that would have represented 15 exahashes per second (EH/s) of mining capacity.
As of the end of June, Core Scientific held 848 BTC valued at $49.7 million, an increase from 547 BTC in the previous quarter. The firm sold 2,385 BTC for $208.2 million in the first quarter.
In pre-market trading, shares of Core Scientific saw a rise of 5.6%, while AMD shares experienced a decline of 4%, reflecting a broader downturn in the semiconductor sector.
