Core Scientific is set to raise $3.3 billion through a high-yield bond sale, marking a significant step in its transition to artificial intelligence-focused data center operations. The surge in demand for AI services has led to increased pressure on data centers, power supply, and advanced chip capabilities, prompting companies to explore riskier debt markets for funding.
Core Scientific, formerly a major bitcoin miner, sold $175 million in bitcoin last month to further its AI-focused strategy. According to Bloomberg, borrowers associated with AI infrastructure have raised $17.9 billion in junk bonds this year. Core Scientific is constructing six data centers designed to support AI workloads, with CoreWeave leasing the capacity under a 12-year agreement that could generate around $10 billion in revenue. This move follows a series of large deals, including recent offerings tied to Google-backed data centers and CoreWeave, which raised a combined $6.7 billion.
Core Scientific plans to use the proceeds to repay existing debt, fund reserves, and support construction across multiple states if costs exceed available funds, highlighting the capital-intensive nature of AI development. The company currently holds fewer than 1,000 bitcoin, according to CFO Jim Nygaard.
Core Scientific's pivot from bitcoin mining to AI hosting is driven by the pursuit of higher margins. The company's shares have risen by about 6% and are up nearly 42% this year, while bitcoin has fallen by 11%.