Core Scientific is set to raise $3.3 billion through a high-yield bond sale, further solidifying its shift towards artificial intelligence-driven 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 for funding. Following its sale of $175 million in bitcoin last month, Core Scientific is now building 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 is part of a larger trend, with AI infrastructure-related borrowers raising $17.9 billion in junk bonds so far this year.
Core Scientific plans to use the proceeds to repay existing debt, fund reserves, and support construction across several states if costs exceed available funds, highlighting the capital-intensive nature of AI development. The company's pivot from bitcoin mining to AI hosting is driven by profit margins, as the decline of bitcoin prices and rising power costs have made mining unprofitable for many.
With its existing data centers and power contracts gaining new value as AI hosting infrastructure, Core Scientific has caught investors' attention and is now a key player in the AI push, with its shares rising nearly 42% this year.