AUSTIN, Texas - Core Scientific, Inc. (NASDAQ: CORZ), a prominent North American provider of high-powered digital infrastructure for bitcoin mining and hosting services, has announced substantial operational updates for June 2024, including securing high-performance computing (HPC) hosting contracts totaling 270 megawatts (MW). The agreements, projected to generate over $4.7 billion in revenue over the next 12 years, mark a significant expansion of the company's hosting business.
In June, Core Scientific mined 430 bitcoins, contributing to a total of 1,680 bitcoins in the second quarter. Additionally, the company's clients earned an estimated 110 bitcoins through its data centers.
Core Scientific's operational infrastructure has grown to 832 MW following the completion of a 72 MW expansion at its Denton, Texas data center. The company also initiated a project to finalize 100 MW of partially built infrastructure at its Pecos, Texas facility.
The new HPC hosting agreements include a 200 MW contract with CoreWeave, anticipated to yield $3.5 billion, and a 70 MW contract with the potential to bring in $1.225 billion, both spanning 12 years. These contracts signify the beginning of an expansion that leverages Core Scientific's high-power digital infrastructure.
To accommodate the growth in its HPC hosting business, Core Scientific has migrated bitcoin miners from data centers designated for HPC hosting to other mining sites. The company's average self-miner energy efficiency has improved to 23.6 joules per terahash, which is expected to support favorable mining economics.
Core Scientific operates approximately 205,000 bitcoin miners across its seven data centers in the United States, with a combined energized hash rate of 24.6 exahashes per second (EH/s).
The company's self-mining operations, which represent about 80% of the miners, have an energized hash rate of 19.4 EH/s. Hosting services account for the remaining 20% of the miners, with an energized hash rate of 5.2 EH/s.
The company's strategy post-halving involves curtailment of mining operations to maximize profitability, which has led to a reduction in power consumption and support for local grid partners.
This information is based on a press release statement from Core Scientific, Inc.
In other recent news, Core Scientific Inc. has been the subject of multiple analyst upgrades and positive expectations. H.C. Wainwright and Compass Point both increased their price targets for the company to $11.00 and $12.50 respectively, reflecting confidence in Core Scientific's strategic expansion initiatives and potential growth. BTIG also upgraded Core Scientific from a Neutral to a Buy rating, highlighting the company's consistent operational performance.
Notably, Core Scientific recently announced a significant expansion of its hosting agreement with CoreWeave, which is expected to generate an additional $1.225 billion in cumulative revenue, supplementing the over $3.5 billion in revenue projected from prior agreements. This expansion is part of a broader strategy to diversify its portfolio and reinforce its bitcoin mining operations.
Core Scientific CEO, Adam Sullivan, has also secured a new employment agreement, which includes a base salary of $625,000 and an annual incentive target of 125% of the base salary, contingent upon performance criteria.
This development comes alongside a 72-megawatt capacity expansion at its Denton, Texas data center, which is expected to be completed by 2024, and the company's record bitcoin earnings in March 2024, mining 906 bitcoins and facilitating the earning of an estimated 309 bitcoins for its customers.
These recent developments underscore Core Scientific's growth strategy and its potential to continue delivering value for its shareholders.
InvestingPro Insights
Core Scientific, Inc. (NASDAQ: CORZ) has been navigating the dynamic bitcoin mining landscape with strategic moves, as evidenced by its latest operational updates and significant hosting contracts. The financial metrics and market performance of the company provide additional context for investors seeking to understand the potential of Core Scientific's business model and market positioning.
InvestingPro data reveals a mixed picture of Core Scientific's financial health and market performance. With a market capitalization of $1.8 billion, the company is a notable player in the digital infrastructure space. Despite a slight revenue decline of 1.3% in the last twelve months as of Q1 2024, Core Scientific has demonstrated impressive quarterly revenue growth of 48.6% in Q1 2024, signaling potential for future expansion.
The company's stock has experienced significant volatility, with an InvestingPro Tip indicating that the RSI suggests the stock is in overbought territory. This could be a point of caution for investors considering the timing of their investment. On the flip side, the substantial return over the last month of 41.54% and the impressive three-month price total return of 193.33% underscore the stock's recent strong performance, which may be attractive to momentum investors.
While Core Scientific is not currently profitable, with a last twelve months P/E Ratio (Adjusted) of 181.64, analysts predict the company will be profitable this year, offering a glimmer of hope for future earnings. Investors should note that Core Scientific does not pay dividends, which aligns with many growth-oriented technology firms that prefer to reinvest earnings into the company.
For those looking to delve deeper into Core Scientific's prospects, InvestingPro offers additional insights, including 12 more InvestingPro Tips that can be accessed at https://www.investing.com/pro/CORZ. To enhance your investment research, use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
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