• Total Revenue: $95.4 million for the third quarter.
• Bitcoin Mined: 1,115 Bitcoin in the third quarter.
• Digital Asset Self Mining Revenue: $68.1 million.
• Digital Asset Hosted Mining Revenue: $16.9 million.
• HPC Hosting Revenue: $10.3 million.
• Gross Loss: $0.2 million for the quarter.
• Operating Loss: $41 million for the quarter.
• Net Loss: $455.3 million, primarily due to noncash mark-to-market adjustments.
• Adjusted EBITDA: $10.1 million, representing 11% of revenue.
• Power Cost: $0.038 per kilowatt hour, with an expected average of $0.042 to $0.044 per kilowatt hour for 2024.
• Self Mining Fleet: Approximately 175,000 miners operated as of September 30, 2024.
• Convertible Note Offering: $460 million completed, reducing interest rate to 3%.
• Cash and Cash Equivalents: $253 million at the end of the quarter.
• HPC Hosting Contract Value: Projected aggregate total potential revenue of approximately $8.7 billion over 12 years.
• Direct Cash Cost to Mine Bitcoin: $42,351 per Bitcoin.

• Warning! GuruFocus has detected 7 Warning Signs with CORZ.

Release Date: November 06, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Core Scientific Inc (NASDAQ:CORZ) successfully contracted all 500 megawatts of critical IT load for HPC hosting, securing significant revenue potential.
• The company completed a $460 million convertible note offering, which improved its capital structure by refinancing debt and increasing cash reserves.
• Core Scientific Inc (NASDAQ:CORZ) expanded its capacity through new site acquisitions and existing site expansions, including a new data center in Alabama.
• The company reported a 117% increase in the price of Bitcoin, which positively impacted its digital asset self-mining revenue.
• Core Scientific Inc (NASDAQ:CORZ) is actively pursuing additional power allocations at existing sites, potentially adding up to 300 megawatts of critical IT load.

Negative Points

• Core Scientific Inc (NASDAQ:CORZ) reported a net loss of $455 million for the third quarter, primarily due to non-cash mark-to-market adjustments.
• The company faced a 62% decrease in the number of Bitcoin earned during the quarter, impacting digital asset self-mining revenue.
• Operating expenses increased by $13.5 million year-over-year, driven by personnel expenses, site startup costs, and stock-based compensation.
• Gross margins for digital asset self-mining were negative, reflecting challenging Bitcoin mining economics post-halving.
• The company anticipates no further CapEx for Bitcoin mining this year, indicating potential limitations in expanding its mining fleet.

Q & A Highlights

Q: Are you already in conversation with potential customers for the 100 megawatts being allocated from Bitcoin mining to HPC, and what are the expected CapEx costs? A: Yes, conversations began earlier in the year, and it looks like a competitive process for those 70 megawatts. We are looking at $5 to $8 million per megawatt for the net profit. - Adam Sullivan, CEO

Q: Regarding the 100 megawatt transition, will you sign a lease before spending capital on the transition? A: We aim to finalize a client contract before spending capital, ensuring we know exactly what the client wants to build. - Adam Sullivan, CEO

Q: Any updates on expanding power capacity at existing HPC sites beyond the 500 megawatts for Core weave? A: We are looking at potentially over 300 additional megawatts across existing HPC sites, which could result in a significant uplift in capacity. - Adam Sullivan, CEO

Q: How do you view the potential deal structures for new sites and customers? A: We focus on single-tenant buildings and build-to-suit arrangements for potential clients, ensuring we meet their requirements and timelines. - Adam Sullivan, CEO

Q: How has the market for rental or lease rates changed since the initial Core weave deal? A: Lease rates for 2025 and 2026 are higher, especially as clients are willing to cover some CapEx, allowing us to extract significant value from current demand. - Adam Sullivan, CEO

For the complete transcript of the earnings call, please refer to the full earnings call transcript.