Core Scientific is set to raise $3.3 billion through a high-yield bond sale as part of its strategic shift towards AI-focused data center operations. The surge in demand for AI services has pushed data centers, power supply, and advanced chips to their limits, prompting companies to explore riskier debt markets to fund their operations. Following the sale of $175 million in bitcoin last month, Core Scientific is building six AI data centers with a 12-year lease agreement to CoreWeave, expected to generate around $10 billion in revenue. This move is part of a larger trend, with AI infrastructure borrowers raising $17.9 billion in junk bonds this year.
Core Scientific will use the proceeds to repay existing debt, fund reserves, and support construction across several states. The company's pivot from bitcoin mining to AI hosting is driven by the pursuit of higher margins, as the bitcoin mining industry faced significant challenges due to rising power costs and a decline in bitcoin prices.