BTC Current Affairs Security

Core Scientific Ditches Bitcoin Mining for AI Data Centers—$14 Billion AMD Deal Seals the Shift

2026-07-29

Core Scientific just reported $164.2 million in Q2 revenue—a 109% jump from a year ago—and the earnings call revealed something brutal: the company has basically abandoned Bitcoin mining. Colocation now makes up 83% of its business, generating $136.7 million while mining revenue collapsed 66% to just $21.5 million. This is a company that used to be a pure-play Bitcoin miner, and it's not anymore.

The kicker came the same day. Core Scientific announced a 500 MW partnership with AMD worth $14 billion in base revenue, with plans to eventually support 2.5 GW across five sites under 15-year contracts. That's not chump change. Total leased customer power capacity has hit about 1.1 GW, representing over $24 billion in potential contracted revenue across all contract terms.

The profitability numbers on the colocation side are genuinely striking. Gross margins expanded to 59% from 11% a year ago. Compare that to mining's crumbling margins and the direction becomes obvious. AI infrastructure customers pay better and stick around longer than Bitcoin hash-rate speculators.

Core Scientific is not alone in this pivot. Bitfarms, IREN, and Cipher Digital are all executing similar plays—selling BTC reserves to fund data center infrastructure for AI clients. It's a coordinated exit from the mining game, dressed up as a strategic reorientation.

The balance sheet tells a messier story. The company posted a $1.155 billion net loss, which sounds catastrophic until you realise it's mostly a non-cash accounting charge. A $1.05 billion increase in warrant liability fair value (driven by rising stock price) plus $266.5 million in previously recorded mining asset impairments explain most of it. The operational picture is fine. Q2 adjusted EBITDA was $41.1 million. The net loss is an artefact, not a meltdown.

What actually matters is capital intensity. Core Scientific burned $797.5 million in capex during Q2 alone. Building out AMD's capacity will require roughly $6 billion more, which means significant project-level bond financing. The company is betting hard on infrastructure expansion, and that bet requires serious money.

Mining operations are being wound down systematically. Hosted mining is expected to wrap by end of 2026, with self-mining following suit. By mid-July 2026, the company was billing for 437 MW of leased customer power, up from 395 MW during Q2. The momentum is there, but it's all pointing toward colocation now.

Management's outlook is telling. They're expecting a "clean sheet of paper" in 2027, once mining noise fades and recurring colocation revenue becomes the dominant driver. For a company that built its entire story on Bitcoin mining, that's a fundamental pivot. It's not a hedged bet or a diversification play. It's a wholesale exit wrapped in industrial language about "business model transformation."

Source & further reading:

Sources