Core Scientific is set to raise $3.3 billion via a high-yield bond sale as it accelerates its 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 firms to explore riskier debt markets for funding. Core Scientific, formerly a bitcoin miner, sold $175 million in bitcoin last month to further its AI transition. Borrowers linked to AI infrastructure have raised $17.9 billion in junk bonds this year, according to Bloomberg.
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 use the proceeds to repay existing debt, fund reserves, and support construction across several states if costs exceed available funds. 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 margin considerations.
After filing for Chapter 11 in December 2022, Core Scientific emerged from reorganization in January 2024 and was relisted on Nasdaq under the ticker CORZ. The shift from bitcoin mining to AI hosting has allowed miners to repurpose their existing data centers and power contracts, attracting hyperscalers like Microsoft and Google parent Alphabet.
Core Scientific's shares have risen about 6% and are up nearly 42% this year, while bitcoin has fallen 11%.