In a bid to accelerate its transition to AI-focused data center operations, Core Scientific is set to raise $3.3 billion through a high-yield bond sale. This move comes as the demand for AI services continues to surge, pushing data centers, power supply, and advanced chips to their limits. To keep pace, companies are seeking funds from riskier debt market segments to support their operations.
Core Scientific, a former bitcoin miner, recently sold $175 million worth of bitcoin to further its AI-centric shift. According to Bloomberg, borrowers associated with AI infrastructure have raised $17.9 billion in junk bonds so far this year.
Core Scientific is building six data centers to support AI workloads, with the capacity leased to CoreWeave under a 12-year agreement that could generate around $10 billion in revenue. The company plans to utilize the proceeds to repay existing debt, fund reserves, and support construction across several states if costs exceed available funds.
This move underscores the capital-intensive nature of the AI buildout. Core Scientific still holds less than 1,000 bitcoin, according to CFO Jim Nygaard. The company's pivot from bitcoin mining to AI hosting is driven by the pursuit of higher margins.
Following its emergence from reorganization in January 2024, Core Scientific has been focusing on the AI sector, which has attracted significant investment. The company's shares have seen a significant increase, with a 6% rise on Tuesday and a nearly 42% increase this year, while bitcoin prices have fallen by 11%.