Core Scientific Abandons Bitcoin Mining for AMD AI Deal Worth 14 Billion

Core Scientific, once one of the largest publicly traded bitcoin miners in North America, has signed a massive 15-year infrastructure deal with AMD that could reshape the company’s identity forever — and the bitcoin mining industry is taking notes.

The agreement, announced on July 28, locks in 529 megawatts of U.S.-based AI computing capacity for AMD across Core Scientific facilities in Texas and Oklahoma. The total base contracted revenue from the deal? More than 14 billion over a decade and a half. And if AMD exercises its options to reserve additional capacity through 2028, the partnership could scale to roughly 2.5 gigawatts.

The Deal That Accelerated a Pivot

This is not a side project. AMD directly leased 377 MW across Core Scientific sites in Pecos and Hunt County, Texas, plus Muskogee, Oklahoma. An unnamed cloud provider leased another 152 MW in Auburn, Alabama, and Dalton, Georgia, under agreements supported by AMD. The infrastructure is expected to support customer deployments beginning in 2027.

The collaboration goes beyond simple real estate. Core Scientific and AMD will work together on data-center design and the deployment of AMD Instinct GPUs, EPYC processors, and ROCm software. In other words, Core Scientific is transforming from a company that once packed warehouses with bitcoin-mining rigs into a purpose-built AI infrastructure provider.

AMD also received warrants to purchase up to 30 million Core Scientific shares at 23.47 per share. About 6.5 million vested immediately upon signing, with more vesting as additional capacity gets contracted. That aligns AMD’s financial interests directly with Core Scientific’s success.

The Numbers Tell the Story

The financial impact is already visible. The new agreements lift Core Scientific’s total leased customer capacity to approximately 1.1 gigawatts, representing more than 24 billion in potential contracted revenue. As of mid-July, the company was billing customers for 437 MW — equivalent to about 635 million in annualized colocation revenue.

The second-quarter breakdown is even more revealing. Colocation generated 136.7 million, accounting for 83% of the company’s 164.2 million in Q2 revenue. Meanwhile, self-mining revenue collapsed by 66% year-over-year, falling to just 21.5 million. The message from the financials is unambiguous: bitcoin mining is no longer the core business at Core Scientific.

Block Deal Terminated — A Clean Break

Perhaps the starkest signal of the pivot is the termination of Core Scientific’s agreement with Block to purchase the payments company’s custom bitcoin-mining chips. The 2024 deal covered 3-nanometer chips representing roughly 15 EH/s of hashrate — a significant chunk of mining power. Core Scientific recorded a 41.9 million charge to walk away from it.

That termination is not just a financial write-down. It represents a strategic decision to stop investing in next-generation mining hardware and instead redirect capital and energy capacity toward AI infrastructure. The bitcoin network will lose that hashrate; AI data centers will gain the power.

What This Means for Bitcoin Mining

With BTC trading at 63,421 as of this writing, the economics of bitcoin mining remain under pressure. Energy costs, regulatory uncertainty, and post-halving block rewards have squeezed margins across the industry. Core Scientific’s response — pivoting to AI — is a playbook that other miners are watching closely.

The company held 848 BTC on its balance sheet as of June 30, up from 547 BTC three months earlier. But it also sold 2,385 BTC for 208.2 million in the first quarter. That selling pressure, combined with the termination of the Block chip deal, suggests Core Scientific is converting its bitcoin treasury into AI infrastructure capital.

For the broader mining sector, the implications are significant. If one of the largest publicly traded miners is willing to abandon next-generation hardware investments and eat a 41.9 million charge to exit mining commitments, others may follow. The total network hashrate could face headwinds if more large operators redirect their energy capacity toward AI workloads rather than securing the bitcoin network.

The AI Computing Arms Race

The Core Scientific–AMD partnership exists within a broader context. Demand for AI computing infrastructure has exploded, and the companies that control large-scale energy capacity — which is exactly what bitcoin miners built over the past decade — are uniquely positioned to capitalize. Data centers need power, cooling, and physical space. Bitcoin mining facilities have all three in abundance.

The deal also gives AMD a foothold in the infrastructure layer, not just the chip layer. By securing long-term capacity at Core Scientific sites, AMD ensures that its Instinct GPUs and EPYC processors have homes where they can run for paying customers. That vertical integration — from silicon to data center — could prove to be a competitive advantage against rivals like Nvidia.

CORZ shares responded positively, rising 5.6% in pre-market trading on the announcement. AMD shares were lower by 4% as the broader chip sector continues to face selling pressure — but the strategic value of this deal extends well beyond daily stock movements.

The Verdict

Core Scientific’s AMD deal may come to be seen as a defining moment for the bitcoin mining industry’s evolution. The 14 billion in potential base revenue from AI colocation dwarfs what the company could earn from mining bitcoin at current prices. With ETH at 1,875 and SOL at 73.12, the broader crypto market offers no immediate relief for miners struggling with compressed margins.

The question for investors and industry observers is whether Core Scientific is an outlier or a trendsetter. If more mining companies follow this path, the bitcoin network’s security model could face structural changes — fewer professional miners, more fragmented hashrate distribution, and potentially higher transaction fees as block subsidy continues to decline post-halving.

For now, Core Scientific has made its bet. The company that once bet everything on bitcoin is now betting that AI will pay better. The next few quarters will reveal whether that gamble pays off — and whether the rest of the mining industry agrees.

Disclaimer

This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments carry significant risk, and readers should conduct their own research before making any investment decisions. The author holds no positions in the assets mentioned in this article.