Core Scientific Announces February 2024 Production and Operations Updates
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Insights
The operational update from Core Scientific, Inc. indicates a strategic maneuvering in the highly competitive bitcoin mining industry. The company's ability to increase its self-mining hash rate by a substantial 300 petahash, through the redeployment of previous generation miners, is a testament to its agility in optimizing resources for better returns. Despite a slight decrease in self-mined bitcoin from January to February, the company's earnings from bitcoin sales remain robust, with proceeds approximating $46.7 million in February. This reflects a dynamic pricing strategy that leverages spot market conditions.
From a financial perspective, the completion of all miner payments due in 2024 for the S19j XPs and S21s is a critical step towards reducing future financial liabilities and strengthening the balance sheet. This preemptive fulfillment of financial obligations should reassure investors about the company's fiscal prudence and its commitment to managing capital expenditures effectively. The impact on stock performance will likely hinge on the broader cryptocurrency market trends and investor sentiment towards the sector's volatility.
Core Scientific's update highlights significant developments in their operational capabilities, with the operation of approximately 222,000 bitcoin miners. The total energized hash rate of 25.1 EH/s represents a substantial share of the global bitcoin mining power, which is a critical factor in maintaining competitiveness. The strategic focus on increasing self-mining efficiency, as seen in the reduction of the average self-mining fleet efficiency to 26.79 J/TH, is indicative of the company's commitment to technological advancements and energy efficiency.
Moreover, the company's efforts to support the electrical grid by delivering 941 megawatt hours to local grid partners in February not only demonstrate corporate responsibility but also may provide a buffer against regulatory pressures concerning energy consumption by cryptocurrency miners. This dual approach of operational excellence and community engagement could position Core Scientific favorably in the eyes of potential investors who are increasingly valuing sustainability and corporate citizenship.
Core Scientific's engagement in grid support services is a noteworthy aspect of their operations, as it reflects a strategic alignment with energy sector trends towards demand response programs. By reducing power consumption at strategic times, the company contributes to grid stability, which can be particularly valuable during peak demand periods. This not only enhances the company's reputation as a responsible energy consumer but also potentially opens up additional revenue streams through participation in demand response programs.
The energy sector's increasing focus on integrating renewable energy sources and maintaining grid stability presents both challenges and opportunities for energy-intensive industries like bitcoin mining. Core Scientific's proactive approach to grid support could serve as a model for other companies in the sector, potentially mitigating some of the regulatory risks associated with high energy consumption and aligning with broader societal goals for energy efficiency and sustainability.
Core Scientific, Inc. February ‘24 Update -
- Operated approximately 222,000 owned and hosted bitcoin miners
- Earned 893 self-mined bitcoin and our customers earned an estimated 307 bitcoin in our data centers in February
- Increased self-mining hash rate by redeploying previous generation miners
- Completed all payments due in 2024 for previously announced miner orders
Core Scientific designs its data centers with heat aisles to optimize miner performance without HVAC systems (Photo: Business Wire)
“Owning our own infrastructure provides us with strategic flexibility to respond rapidly to dynamic market conditions,” said Adam Sullivan, Core Scientific’s Chief Executive Officer. “For example, we increased our self-mining hash rate by 300 petahash largely by redeploying earlier-generation miners. These miners had been replaced with more efficient S19j XP units in January, using newly activated capacity. Capitalizing on strong spot bitcoin pricing, quickly reactivating these miners boosted our hash rate and enhances our bitcoin earnings.”
“From a capital expenditures perspective, we continue to manage our investments carefully to ensure our ongoing financial strength. To that end, we completed all miner payments due in 2024 for the S19j XPs and S21s we previously announced, enabling us to focus our remaining investments this year on new miner purchases and our organic infrastructure growth plans,” Mr. Sullivan added.
Key Metrics Summary
Metric |
February 2024 |
January 2024 |
Self-Mining Bitcoin Earned1 |
893 |
1,027 |
Hosting Bitcoin Earned by Customers2 |
307 |
354 |
Average Self-Mined Bitcoin Earned/Day |
30.8 |
33.1 |
Self-Mining Energized Hash rate3 |
18.9 |
18.6 |
Hosting Energized Hash rate4 |
6.2 |
6.2 |
Total Energized Hash rate |
25.1 |
24.8 |
Bitcoin Sold |
952 |
1,114 |
Bitcoin Sales Proceeds ($USD) |
Appx. |
Appx. |
Average Self-Mining Fleet Efficiency (J/TH)5 |
26.79 |
26.44 |
Data Centers
As of month-end, the Company operated approximately 222,000 bitcoin miners for both self-mining and hosting, representing a total energized hash rate of 25.1 EH/s at its data centers in
Self-Mining
Core Scientific earned 893 bitcoin in February from its owned fleet of miners. As of month end, the Company operated approximately 171,000 owned bitcoin miners, accounting for approximately
Hosting Services
In addition to its self-mining fleet, Core Scientific provided data center hosting services, technology and operating support for approximately 51,000 hosted, customer-owned bitcoin miners, representing approximately
Grid Support
The Company reduced the consumption of power at its data centers on several occasions in February, delivering 941 megawatt hours to local grid partners. By supporting the grid in such a fashion, Core Scientific helps grid operators keep power flowing to their customers when temperatures rise and air conditioning use increases, and when temperatures drop and heating use increases. Core Scientific works with utility companies and the communities in which it operates to enhance electrical grid stability.
New Miner Deployments
As a result of the deployment of 28,400 new S19j XP miners procured from Bitmain under a contract announced on September 21, 2023, and completed this January, a number of prior generation bitcoin miners were de-energized. These de-energized miners were redeployed and re-energized using newly available capacity at two of the Company’s data centers, contributing to an increase in self-mining hash rate. The Company completed all payments due for the Bitmain S19j XP miners and completed all payments due in 2024 for the additional 2.5 exahash in Bitmain S21 miners previously announced, while also accelerating their delivery to begin in mid-March, 2024.
ABOUT CORE SCIENTIFIC
Core Scientific is one of the largest bitcoin miners and hosting solutions providers for bitcoin mining in
FORWARD LOOKING STATEMENTS AND EXPLANATORY NOTES
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” “seek,” “target” or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. The Company’s actual results may differ materially from those anticipated in these forward-looking statements as a result of certain risks and other factors, which could include, but are not limited to, the following: risks and uncertainties relating to the Company’s ability to achieve significant cash flows from operations; the effects of the emergence from the Company’s chapter 11 cases on the Company’s liquidity, results of operations and business; the trading price and volatility of the Company’s common stock; the comparability of the Company’s post-emergence financial results to its historical results and the projections filed with the bankruptcy court in the Company’s chapter 11 cases; changes in the Company’s business strategy and performance, including as a result of changes to the Company’s board of directors or management; the possibility that the Company may be unable to achieve its business and strategic goals; the Company’s post-bankruptcy capital structure; attraction and retention of key personnel; the Company’s ability to achieve expected benefits from restructuring activities; restrictions on the Company’s operations contained in the agreements governing the Company’s indebtedness; the Company’s ability to generate sufficient cash to reduce its indebtedness and its potential need and ability to incur further indebtedness; the impact of the halving event; actions taken by third parties, including the Company’s creditors and other stakeholders, as well as other risk factors set forth in the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission. These statements are provided for illustrative purposes only and are based on various assumptions, whether or not identified in this press release, and on the current expectations of the Company’s management. These forward-looking statements are not intended to serve, and must not be relied on by any investor, as a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the control of the Company. These forward-looking statements are subject to a number of risks and uncertainties, including those identified in the Company’s reports filed with the
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1 Self-Mining Bitcoin Earned represents bitcoin rewards earned by bitcoin miners owned and operated by Core Scientific
2 Hosting Bitcoin Earned represents estimated bitcoin rewards earned by hosted customer-owned miners operated by Core Scientific, including bitcoin rewards paid to the Company pursuant to proceeds sharing agreements
3 Self-Mining Energized Hash Rate represents the total rated capacity of all Company-owned bitcoin miners installed and operating in Core Scientific’s data centers
4 Hosting Energized Hash Rate represents the total rated capacity of all hosted bitcoin miners owned by customers, installed and operating in Core Scientific’s data centers
5 Average Self-Mining Fleet Efficiency (J/TH) represents the weighted average power consumption in Joules per terahash based on the actual efficiency of each model of miner operating in Core Scientific’s owned self-mining fleet˙
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Source: Core Scientific, Inc.
FAQ
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