Core Scientific is set to raise $3.3 billion through a high-yield bond sale as part of its strategic shift towards artificial intelligence-focused data center operations. The surge in demand for AI services has led to a significant strain on data centers, power supply, and advanced chip technology, prompting companies to explore riskier debt markets to secure funding for their operations. Following its sale of $175 million in bitcoin last month, Core Scientific, formerly a major bitcoin miner, 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 borrowers raising $17.9 billion in junk bonds so far this year. Core Scientific plans to utilize the proceeds to repay existing debt, fund reserves, and support construction projects across several states.
The company's pivot from bitcoin mining to AI hosting is driven by the pursuit of higher profit margins, as the bitcoin mining industry faces significant challenges due to rising power costs and a decline in bitcoin prices.