Core Scientific is set to raise $3.3 billion through a high-yield bond sale, furthering its strategic shift towards AI-driven data center operations. The surge in demand for AI services has led to a significant strain on data centers, power supply, and advanced chips, prompting companies to explore riskier debt markets to secure funding for operational development.
Core Scientific, previously a major bitcoin miner, recently sold $175 million in bitcoin to accelerate its AI-focused pivot. According to Bloomberg, borrowers associated with AI infrastructure have raised $17.9 billion in high-yield bonds this year.
Core Scientific is developing six data centers to support AI workloads, with a 12-year lease agreement with CoreWeave that could generate around $10 billion in revenue. This move follows a series of large-scale deals, including recent offerings tied to Google-backed data centers and CoreWeave, which collectively raised $6.7 billion. Core Scientific intends to utilize the bond proceeds to repay existing debt, fund reserves, and support construction projects across multiple states if costs exceed available funds, highlighting the capital-intensive nature of AI infrastructure development. The company currently holds fewer than 1,000 bitcoin, according to CFO Jim Nygaard.
Core Scientific's strategic shift from bitcoin mining to AI hosting is driven by the pursuit of higher margins. The company's pivot has sparked investor interest, with its shares rising approximately 6% on Tuesday and nearly 42% this year, while bitcoin prices have declined 11%.