Core Scientific Announces May 2024 Production and Operations Updates
Core Scientific (Nasdaq: CORZ) reported its May 2024 production and operations updates. The company mined 447 self-mined bitcoins, totaling 4,076 bitcoins year-to-date, while customers mined 128 bitcoins. Core Scientific operated 219,000 bitcoin miners with a total hash rate of 26.1 exahash as of May 31, 2024. The company announced new hosting contracts with CoreWeave, estimated to generate $3.5 billion in revenue over 12 years. However, the production metrics showed a decline from April 2024, with reduced bitcoin production and sales proceeds. The company's strategies included reducing power consumption to maximize profitability and replacing older miners with new S21 models. Upcoming events include an investor and analyst event on June 12, 2024, and Mining Disrupt on June 25-26, 2024.
- Earned 447 self-mined bitcoins in May 2024, totaling 4,076 bitcoins year-to-date.
- Operated 219,000 bitcoin miners with a total hash rate of 26.1 exahash.
- New hosting contracts with CoreWeave estimated to generate $3.5 billion over 12 years.
- Potential additional 300 megawatts for HPC hosting under discussion.
- Implemented post-halving strategy to maximize profitability by curtailing power consumption.
- Bitcoin production decreased from 803 in April to 447 in May.
- Customer's bitcoin production decreased from 265 in April to 128 in May.
- Total energized hash rate decreased from 26.7 in April to 26.1 in May.
- Bitcoin sales proceeds fell from approximately $55.8 million in April to $29.4 million in May.
- The replacement of older miners with new S21 models may lead to a decrease in operational infrastructure and hash rate.
Insights
Core Scientific's production update for May 2024 reveals multiple data points that are important for understanding the company's current standing and future potential. The company earned 447 self-mined bitcoin and facilitated the mining of an additional 128 bitcoin for customers. These figures indicate a noticeable decrease from April 2024, where they earned 803 self-mined bitcoin and 265 hosting bitcoin. This decline might signal operational issues or changes in mining efficiency.
Looking at the average daily bitcoin earned and comparing it to the previous month, a drop from 26.8 to 14.4 self-mined bitcoin per day is significant. This drop could be linked to the company's strategy to curtail portions of its fleet to maximize profitability based on miner efficiency, hash price and power prices. This strategic maneuvering might be profitable in the long term but presents short-term revenue fluctuations.
The company’s decision to sign new hosting contracts with CoreWeave for
For retail investors, these updates suggest a mixed outlook. The long-term hosting agreements offer stability and growth potential, but the short-term declines in self-mining output and bitcoin sales revenue are points of concern. Investors should weigh these factors based on their risk tolerance and investment horizon.
The May 2024 update from Core Scientific brings to light several technical aspects of their operations. The company operates approximately 219,000 bitcoin miners, with an energized hash rate of 26.1 exahash. The hash rate is a critical metric in bitcoin mining, representing the computational power used to mine new bitcoins and secure the network. A higher hash rate generally indicates more robust and efficient mining operations.
However, the slight reduction in the total energized hash rate from 26.7 EH/s in April to 26.1 EH/s in May could raise concerns about the efficiency or deployment strategy of their mining hardware. The deployment of new S21 miners at their Calvert City and Pecos data centers is a positive development, as it suggests an ongoing upgrade to more efficient hardware, which should enhance overall mining efficiency and profitability in the future.
Additionally, Core Scientific’s strategy to curtail power consumption and support local grids by delivering 26,328 megawatt hours is an example of operational flexibility and responsiveness to fluctuating power prices. This approach not only maximizes profitability but also demonstrates corporate responsibility by aiding local grid stability.
For investors, these technical updates underscore Core Scientific’s commitment to maintaining cutting-edge mining operations, albeit with some short-term fluctuations. The long-term benefits of upgraded hardware and flexible power strategies may outweigh the immediate decreases in hash rate and bitcoin output.
- Earned 447 self-mined bitcoin for a total of 4,076 bitcoin year-to-date, and our customers earned an estimated 128 bitcoin at our data centers in May
- Operated approximately 219,000 owned and hosted bitcoin miners for a total energized hash rate of 26.1 exahash as of May 31, 2024
Core Scientific is one of the largest owners and operators of high-powered digital infrastructure for bitcoin mining and hosting services in
“We continue to execute well in our strong bitcoin mining business while also leveraging our valuable portfolio of high-power digital infrastructure to expand our hosting business, as demonstrated by our recent announcement of new, long-term hosting contracts for 200 megawatts of HPC infrastructure with CoreWeave, the AI Hyperscaler,” said Adam Sullivan, Core Scientific’s Chief Executive Officer. “These contracts represent one of the largest AI hosting agreements to date, and they will strengthen our earnings power with an estimated
“Our discussions with potential clients to modify an additional 300 megawatts of our high-power infrastructure for HPC hosting continue, representing an even greater source of revenue by capitalizing on strong market demand. Supported by powerful industry tailwinds across AI compute, we are excited about the meaningful opportunities ahead to maximize the value of our digital infrastructure portfolio to deliver on our business objectives and create sustainable shareholder value,” added Mr. Sullivan.
Key Metrics Summary (unaudited)
| Metric | May 2024 |
April 2024 |
Self-Mining Bitcoin Earned1 |
447 |
803 |
Hosting Bitcoin Earned by Customers2 |
128 |
265 |
Average Self-Mined Bitcoin Earned/Day |
14.4 |
26.8 |
Self-Mining Energized Hash rate3 |
20.4 |
20.4 |
Hosting Energized Hash rate4 |
5.7 |
6.3 |
Total Energized Hash rate |
26.1 |
26.7 |
Bitcoin Sold5 |
453 |
847 |
Bitcoin Sales Proceeds ($USD) |
Appx. |
Appx. |
Average Self-Mining Fleet Efficiency (J/TH)6 |
24.23 |
25.78 |
Data Centers
As of month-end, the Company operated approximately 219,000 bitcoin miners for both self-mining and hosting, representing a total energized hash rate of 26.1 EH/s at its seven data centers in
Self-Mining
Core Scientific earned 447 bitcoin in May from its owned fleet of miners. As of month end, the Company operated approximately 173,000 owned bitcoin miners, representing approximately
Hosting Services
In addition to its self-mining fleet, Core Scientific provided data center hosting services, technology and operating support for approximately 46,000 hosted, customer-owned bitcoin miners, representing approximately
Grid Support
In May, the Company implemented its post-halving strategy to maximize profitability by curtailing portions of its fleet based on miner efficiency, hash price and power prices. This strategy reduced the consumption of power at its data centers on several occasions and delivered 26,328 megawatt hours to local grid partners
Miner Deployments
Prior generation miners replaced by new S21s deployed earlier this year continue to operate at Core Scientific’s
Upcoming Events and Conferences
Core Scientific Investor and Analyst Event, June 12, 2024
Mining Disrupt, June 25-26, 2024
ABOUT CORE SCIENTIFIC
Core Scientific is one of the largest owners and operators of high-powered digital infrastructure for bitcoin mining and hosting services in
FORWARD LOOKING STATEMENTS AND EXPLANATORY NOTES
This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding projections, estimates and forecasts of revenue and other financial and performance metrics, projections of market opportunity and expectations, the Company’s ability to scale and grow its business, source clean and renewable energy, the advantages and expected growth of the Company and the Company’s ability to source and retain talent. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “aim,” “estimate,” “plan,” “project,” “forecast,” “goal,” “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. All forward looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including: our ability to earn digital assets profitably and to attract customers for our hosting capabilities; our ability to maintain our competitive position as digital asset networks experience increases in total network hash rate; our ability to raise additional capital to continue our expansion efforts or other operations; our need for significant electric power and the limited availability of power resources; the potential failure in our critical systems, facilities or services we provide; the physical risks and regulatory changes relating to climate change; potential significant changes to the method of validating blockchain transactions; our vulnerability to physical security breaches, which could disrupt our operations; a potential slowdown in market and economic conditions, particularly those impacting the blockchain industry and the blockchain hosting market; the identification of material weaknesses in our internal control over financial reporting; price volatility of digital assets and bitcoin in particular; the “halving” of rewards available on the Bitcoin network, or the reduction of rewards on other networks, affecting our ability to generate revenue as our customers may not have an adequate incentive to continue mining and customers may cease mining operations altogether; the potential that insufficient awards from digital asset mining could disincentivize transaction processors from expending processing power on a particular network, which could negatively impact the utility of the network and further reduce the value of its digital assets; the requirements of our existing debt agreements for us to sell our digital assets earned from mining as they are received, preventing us from recognizing any gain from appreciation in the value of the digital assets we hold; potential changes in the interpretive positions of the SEC or its staff with respect to digital asset mining firms; the increasing likelihood that
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1 Self-Mining Bitcoin Earned represents bitcoin rewards earned by bitcoin miners owned and operated by Core Scientific; the sequential decline in May resulted from the first full month of post-halving operations.
2 Hosting Bitcoin Earned represents estimated bitcoin rewards earned by customer-owned miners installed and operated by Core Scientific in our data centers, including bitcoin rewards earned by customers and 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. Includes previous generation miners removed to accommodate new miners and then re-deployed opportunistically to exploit favorable mining economics.
4 Hosting Energized Hash Rate represents the total rated capacity of all hosted bitcoin miners owned by customers, installed and operated by Core Scientific in our data centers.
5 Bitcoin Sold represents all bitcoin sold by the Company during the period, including self-mined and proceeds sharing rewards.
6 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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