Core Scientific announced it will fully exit Bitcoin mining by the end of Q4 2026 to become a pure-play high-density AI colocation provider in 2027. In Q3 2026, colocation revenue jumped nearly 60% sequentially to $215.4 million, representing over 92% of total revenue, while self-mining posted a $7.5 million gross loss. Surging production costs post-halving and lucrative contracts with AI partners like CoreWeave and AMD are driving Core Scientific and peers MARA and Riot away from traditional mining, despite emerging political headwinds around data-center energy demands.
Core Scientific's transition From Mining to AI
- ▪Core Scientific paid $41.9 million to terminate its Bitcoin mining chip supply agreement with Block and Proto during 2026
- ▪Chief Financial Officer Jim Nygaard said Core Scientific will transition into a pure-play high-density colocation provider for high-performance computing and AI workloads starting in 2027
- ▪Core Scientific reduced its active Bitcoin mining fleet by nearly 50% between the end of 2025 and September 30, 2026
- ▪Core Scientific announced that it plans to complete its exit from Bitcoin self-mining
Core Scientific Q3 2026 colocation and mining revenues
- ▪Core Scientific recorded $215.4 million in colocation revenue for Q3 2026, a 60% sequential increase accounting for over 92% of its $232.9 million total quarterly revenue
- ▪Core Scientific was billing for 485 megawatts of colocation capacity as of September 30, 2026, generating over $700 million in annualized GAAP revenue
Core Scientific's major AI colocation contracts
- ▪Core Scientific maintains a long-term colocation contract with CoreWeave covering approximately 590 megawatts of IT capacity
- ▪Core Scientific established an agreement with AMD covering 530 megawatts of capacity across five campuses, with full delivery targeted by year-end 2028
Industry-wide miner shift to AI infrastructure
- ▪At least 35 EH/s of hash rate computing power is scheduled to be retired by publicly listed Bitcoin miners transitioning toward AI infrastructure
- ▪Riot Platforms signed a 20-year lease for 191 megawatts of IT capacity with an AI laboratory, projecting $9.1 billion in total contract revenue
- ▪MARA Holdings sold 15,133 BTC for approximately $1.1 billion in March 2026 and reduced its workforce by 15% to reallocate capital toward strategic opportunities
- ▪HIVE Digital began winding down Bitcoin mining operations in Sweden to expand artificial intelligence and high-performance computing infrastructure in Canada
Political and local opposition to data centers
- ▪Gains by Democratic candidates in the 2026 U.S. midterm elections increased political scrutiny surrounding data-center expansion and regional electricity costs
- ▪Local opposition to data-center developments stems from concerns over rising household electricity bills and resource demands on local electrical grids
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