Core Scientific Reports 56% Revenue Decline, Shifts Focus to Colocation Services

Core Scientific, Inc. reported a significant decline in financial performance for the first quarter of 2025, with total revenue falling to $79.5 million, a decrease of 56% from $179.3 million in the same period last year. The company's digital asset self-mining revenue dropped by 55% to $67.2 million, primarily due to a 75% decrease in bitcoin mined, which fell to 719 bitcoins from 2,825. This decline was attributed to a reduction in deployed mining units as the company shifted focus towards its colocation business, a 50% decrease in block rewards following the April 2024 halving, and a 39% increase in network difficulty.

Despite the revenue drop, Core Scientific reported a net income of $580.7 million for the quarter, compared to $210.7 million in the prior year. This increase was largely driven by a significant change in the fair value of warrants and contingent value rights, which saw a decrease of $634.3 million. The company also experienced a notable rise in selling, general, and administrative expenses, which increased by 137% to $40.1 million, reflecting higher stock-based compensation and costs associated with the startup of its colocation segment.

Operationally, Core Scientific is transitioning its business model to focus more on high-density colocation services, which it believes will provide more stable revenue streams compared to the volatility of digital asset mining. The company has begun converting several of its data centers to support artificial intelligence workloads and has entered into a new agreement with CoreWeave, Inc. to deliver additional infrastructure at its Denton, Texas facility. As of March 31, 2025, the company reported a billable power load of approximately 870 megawatts and a gross power capacity of 1,320 megawatts.

Looking ahead, Core Scientific aims to expand its colocation customer base while maintaining its digital asset mining operations. The company anticipates that the growth of its colocation segment will gradually reduce its exposure to the volatility of bitcoin prices. With a focus on hyperscale cloud-based providers and enterprises, Core Scientific is positioning itself to capitalize on the increasing demand for outsourced data center facilities. The company remains optimistic about its ability to navigate the evolving landscape of digital assets and high-performance computing.