Core Scientific, Inc. (CORZ) | The Buildout — AI Infrastructure
The Verdict
Core Scientific owns and operates large, power-dense data centers. It built them as Bitcoin mines and is converting them into high-density colocation halls that house AI and high-performance computing hardware for customers. It sells the physical layer of AI — space, power, cooling, and operations — not chips or software. Its value in the buildout is time to readiness: turning existing power interconnects into ready-for-service AI capacity faster than a greenfield build.
| Market Cap | — |
| Revenue (TTM) | $440M |
| Revenue Growth | +26.4% |
| EBITDA Margin (TTM) | -20.0% |
| Net Debt | $2.5B |
| Earnings Beats | 3 of 7 |
| P/E (TTM) | — |
| EV/EBITDA (TTM) | — |
What We Like
- 243 MW of billable capacity was delivered to CoreWeave as of May 6, 2026, which management equated to more than $350 million of annualized colocation GAAP revenue.
- The CoreWeave contract covers 590 MW across five sites, with more than 450 MW expected billable by the end of summer 2026 and the full 590 MW by early 2027.
- The CoreWeave cash gross margin target was raised to 80–85% from 75–80% as cost visibility improved.
- A $3.3 billion project bond closed May 6, 2026 at 7.75%, netting about $2.9 billion; the structure lets most proceeds move to the corporate level to fund projects outside the CoreWeave collateral.
- The July 28, 2026 AMD partnership could add a second anchor: up to 2.5 GW of capacity, about 530 MW under 15-year agreements, and more than $14 billion of potential base contracted revenue.
What We’re Watching
- No non-CoreWeave lease was signed as of May 6, 2026; the first hyperscaler exclusivity expired without a deal.
- CoreWeave is 100% of colocation segment revenue in the FY2025 10-K and 67% of total Q1 2026 revenue; AMD is not yet a reported colocation customer.
- Q1 2026 GAAP results included a $266.5 million property and equipment impairment and a $310.4 million operating loss.
- The company plans roughly $2 billion of 2026 capex, including pre-building about 1 GW of new billable capacity ahead of signed contracts.
The thesis is strengthening on execution and weaker on diversification. Delivery and financing have progressed — 243 MW billing, a closed $3.3 billion bond, a raised margin target — while the promised second customer slipped. The open question is whether the AMD framework or a hyperscaler deal becomes a signed, financed lease that reduces CoreWeave concentration.
Earnings
Core Scientific reported Q2 FY2026 revenue of $164.2 million, up from $115.2 million in the March 2026 quarter, and gross margin of 42.7%, up from 25.8%. The quarter extends the revenue ramp as the company converts its sites from Bitcoin self-mining to high-density colocation. Results were announced July 28, 2026, alongside the AMD infrastructure partnership announcement.
| Metric | Q2 FY2026 | Q1 FY2026 | Q2 FY2025 | YoY |
|---|---|---|---|---|
| Revenue | $164M | $115M | $79M | +108.9% |
| Gross margin | 42.7% | 25.8% | 6.4% | +3630bps |
| EBITDA | −$57M | −$4M | −$5M | +1079.2% |
| EPS | $-3.55 | $-1.08 | $-2.95 | +20.6% |
Our colocation revenue scaled to a level sufficient to cover operating costs and begin expanding margins.— Jim Nygaard, CFO, May 6, 2026
Management tone: Management's tone on the May 6, 2026 call was confident and execution-focused. It shifted from expecting leasing agreements near term to describing active engagement with multiple hyperscalers after one exclusivity expired, and it was direct about the missed new-customer goal and about brownfield conversions proving harder than expected.
Management Guidance
Management issued no formal full-year revenue or EPS guidance; its targets are milestone- and contract-based. It guided more than 450 MW billable by the end of summer 2026 and the full 590 MW by early 2027 on the CoreWeave contract, 2026 capital spending of roughly $2 billion (including about $700 million for the Hunt County and Polaris acquisitions), pre-building about 1 GW of new billable capacity, and a reduction of Bitcoin mining to one or two sites by year-end 2026.
Trajectory
Revenue ran near $80 million a quarter through 2025, then jumped to $115.2 million in Q1 2026 and $164.2 million in Q2 2026 as CoreWeave colocation billing came online while self-mining ran off. Gross margin followed, from the single digits of mid-2025 to 42.7% in Q2 2026. Reported EBITDA is still negative — minus $56.6 million in Q2 2026 — reflecting stock-based compensation and transition charges, while free cash flow was a $967.7 million trailing-twelve-month outflow as the company funded construction.
The Model
The model projects FY+1 revenue of $658 million and EBITDA of $82 million, a 12.5% margin, then FY+2 revenue of $1,200 million and EBITDA of $498 million, a 41.5% margin. The near-term anchor is the CoreWeave contract converting to billing as capacity moves toward the full 590 MW. The FY+2 step-up assumes new colocation customers sign for the unleased capacity and the higher-margin colocation mix dominates.
| Metric | FY2025 | Next FY (E) | Following FY (E) |
|---|---|---|---|
| Revenue | $319M | $658M | $1.2B |
| YoY Growth | — | +106.3% | +82.4% |
| EBITDA | −$57M | $82M | $498M |
| EBITDA Margin | -17.8% | 12.5% | 41.5% |
Projections are the median of 5 independent model runs.
Management issued no formal full-year revenue or EPS guidance; its targets are milestone- and contract-based. It guided more than 450 MW billable by the end of summer 2026 and the full 590 MW by early 2027 on the CoreWeave contract, 2026 capital spending of roughly $2 billion (including about $700 million for the Hunt County and Polaris acquisitions), pre-building about 1 GW of new billable capacity, and a reduction of Bitcoin mining to one or two sites by year-end 2026.
What Could Go Right — and Wrong
- CoreWeave billing reaches the guided more than 450 MW by the end of summer 2026 and 590 MW by early 2027.
- The AMD partnership converts into definitive, financed contracts for the roughly 530 MW anchor and a path toward 2.5 GW.
- A named non-CoreWeave lease is signed for some of the 685 MW of unleased capacity.
- The 80–85% cash gross margin target holds as more CoreWeave megawatts bill.
- Behind-the-meter generation at Pecos and Muskogee is permitted and built on the stated 12–14 month timeline.
- New leases do not sign at expected economics, stranding the pre-built roughly 1 GW and the roughly $2 billion of 2026 capex.
- CoreWeave demand, credit, or its own self-build plans reduce incremental demand beyond the existing 590 MW.
- The mining wind-down produces further impairments after the $266.5 million Q1 2026 charge.
- Labor and long-lead equipment inflation, with 12- to 18-month lead times, slips RFS dates and raises build costs.
- The debt load — $3.30 billion of 7.75% notes plus convertibles — requires substantial cash debt service.
Looking Ahead
Over the next twelve months the tests are delivery and signatures. The company targets more than 450 MW billable by the end of summer 2026 and the full 590 MW by early 2027, an RFS pathway at Pecos within 12 months of May 2026, a first 10 MW at Auburn in the second half of 2026, and completion of the Denton campus by mid-2026. It also plans roughly $2 billion of 2026 capex, including about $700 million for the Hunt County and Polaris acquisitions, while winding Bitcoin mining down to one or two sites.
- Q2 2026Muskogee Phase 1 delivery — 70 MW CoreWeave facility expected to reach full delivery.
- Mid-2026Denton campus complete — CoreWeave's 262 MW Denton campus reaches full completion.
- End of summer 2026450 MW billing milestone — CoreWeave billable capacity passes 450 MW.
- H2 2026Auburn first 10 MW — First phase of the Auburn, Alabama facility delivers.
- Early 2027Full 590 MW billing — CoreWeave contract fully billable, ending with Dalton Phase 2.
Financials
Annual Summary
| Metric | FY2024 | FY2025 | TTM | YoY |
|---|---|---|---|---|
| Revenue | $511M | $319M | $440M | -37.5% |
| Gross Margin | 18.9% | 11.9% | 28.3% | 700bps |
| EBITDA | $101M | −$57M | −$88M | -156.4% |
| EBITDA Margin | 19.8% | -17.8% | -20.0% | 3,759bps |
| Net Income | −$1.3B | −$293M | −$1.4B | +77.7% |
| Free Cash Flow | −$52M | −$461M | −$968M | — |
| Net Cash | — | — | — | — |
Key Ratios (Trailing)
- P/E TTM—
- EV/EBITDA TTM—
- EV/Revenue TTM—
- Price/FCF TTM—
- Gross Margin (TTM)28.3%
- EBITDA Margin (TTM)-20.0%
- Net Margin (TTM)-325.9%
- ROIC-107.5%
- SBC / Revenue21.3%
The Company
Core Scientific designs, builds, and operates large, purpose-built data centers for high-density colocation and digital asset mining. Its AI business is the physical layer under accelerated computing: it sells powered, cooled, ready-for-service data halls to customers running machine-learning and AI workloads, not chips or software. The company is converting its Bitcoin mining sites into high-density colocation; the FY2025 10-K says it intends to convert every megawatt in its portfolio to high-density colocation infrastructure over the next three years.
The operation is power-first and construction-intensive. Through 2025 the company built five CoreWeave sites — about 1 million square feet of data center shell, nearly $2 billion of installed infrastructure assets, more than 5 million labor hours, and an average of 3,300 workers on site. It reports three segments: Colocation, Digital Asset Self-Mining, and Digital Asset Hosted Mining, and is winding self-mining down to one or two sites by the end of 2026. Its sites span Texas, Georgia, North Carolina, Oklahoma, Alabama, Kentucky, and North Dakota.
Business Segments
Competitive Landscape
Core Scientific competes for high-density colocation tenants against other data center operators and against other Bitcoin miners converting to AI hosting. The FY2025 10-K names Aligned Data Centers as a high-density colocation competitor and Applied Digital as both a self-mining/hosting competitor and a miner converting to high-density colocation. Management frames its edge as time to ready-for-service, though Applied Digital and others are also converting mining capacity to high-density colocation.
- Aligned Data CentersNamed in the FY2025 10-K as a high-density colocation market competitor.
- Applied Digital CorporationNamed in the 10-K as a miner converting to high-density colocation and as a self-mining/hosting competitor.
- Named in the supply-chain intelligence as an ecosystem competitor; CORZ filings do not discuss it.
Supply Chain
Core Scientific sits between power and equipment suppliers and the AI cloud operators that lease its data halls. Its load-bearing relationship is CoreWeave, the only colocation customer disclosed in the FY2025 10-K.