Core Scientific has entered into a significant 12-year agreement with CoreWeave, an AI hyperscaler backed by Nvidia, to provide approximately 200 megawatts (MW) of infrastructure for high-performance computing (HPC) services. This strategic move is expected to generate over $3.5 billion in total cumulative revenue for Core Scientific during the initial contract term, with an estimated average annual revenue of around $290 million.
The agreement marks a pivotal shift for Core Scientific, traditionally known for its bitcoin mining operations, as it diversifies into the rapidly growing AI data center space. Core Scientific will modify multiple existing sites to host CoreWeave’s NVIDIA GPUs, with site modifications commencing in the second half of 2024 and operations expected to begin in the first half of 2025. CoreWeave will fund all capital investments required for these modifications, estimated at $300 million, which will be credited against hosting payments until fully repaid.
Adam Sullivan, CEO of Core Scientific, emphasized the strategic benefits of this partnership, noting that the demand for high-power sites continues to outpace supply. He highlighted that Core Scientific’s ability to deliver power more quickly than greenfield data center projects positions the company to meet customer needs effectively. The partnership with CoreWeave allows Core Scientific to balance its portfolio between Bitcoin mining and alternative compute hosting, thereby maximizing cash flow and minimizing risk while maintaining significant exposure to Bitcoin’s potential upside.
The agreement also includes options for CoreWeave to expand its hosting footprint with Core Scientific at additional sites over the next 60 to 90 days. This expansion is part of Core Scientific’s broader strategy to capitalize on its extensive high-power digital infrastructure portfolio, which includes 1.2 gigawatts of contracted power, with nearly 500 MW allocated for HPC workloads.
This deal builds on a history of successful collaboration between Core Scientific and CoreWeave, dating back to 2019. Earlier this year, Core Scientific delivered 16 MW of HPC hosting capacity to CoreWeave ahead of schedule at its new Austin data center. The partnership is expected to enhance Core Scientific’s earnings power and drive shareholder value by increasing exposure to contracted, dollar-denominated revenue streams.
The announcement comes nearly five months after Core Scientific received court approval to…
Click Here to Read the Full Original Article at Cryptocurrency Mining News | CryptoSlate…