Core Scientific (CORZ 0.24%), a digital infrastructure provider with roots in bitcoin mining, reported its Q2 FY2025 results on August 8, 2025. The report revealed a mixed performance. The company posted a net loss, largely due to non-cash charges, as GAAP revenue dropped to $78.6 million, missing analyst expectations of $83.8 million (GAAP). This represented a 44.3% year-over-year decline. The results reflected continued pressure in Core Scientific’s legacy bitcoin mining operations, only partly offset by growing, though still modest, revenue from its newer colocation and AI computing business. Overall, the quarter underscored both the ongoing costs of transition and some encouraging early growth in new digital infrastructure services.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (GAAP) | $(0.04) | $(0.07) | $(4.51) | Not meaningful |
| Revenue (GAAP) | $78.6 million | $83.8 million | $141.1 million | (44.3%) |
| Adjusted EBITDA | $21.5 million | $46.0 million | (53.3%) | |
| Gross Profit | $5.0 million | $38.8 million | (87.1%) | |
| Cash and Cash Equivalents | $581.3 million | $836.2 million(as of Dec 31, 2024) | (30.5%) |
Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.
About the Business and Strategic Focus
Core Scientific operates purpose-built facilities for digital asset mining (such as bitcoin) and high-density colocation, also known as hosting services for demanding computing needs like artificial intelligence. Historically, the company earned most of its revenue by directly mining bitcoin using fleets of specialized computers known as application-specific integrated circuits (ASICs).
Over the last year, Core Scientific has been pivoting toward providing colocation and high-performance computing (HPC) hosting. These are services in which clients rent rack space, power, and network access in specialized data centers. The focus is moving away from the volatile bitcoin market to what management expects will be steadier income from supporting AI and enterprise computing. Key to this transition are conversions of existing mining sites and large contracts with customers such as CoreWeave, an AI cloud computing provider.
Quarter in Review: Key Developments and Results
Core Scientific’s GAAP revenue in Q2 2025 reached $78.6 million, falling short of the $83.8 million GAAP analyst forecast. The largest revenue contributor remained bitcoin self-mining, which generated $62.4 million (GAAP) in digital asset self-mining revenue but was down 43.6% year over year as the number of bitcoins mined fell by 62% year over year. A 50% rise in average bitcoin price partly offset the lower mining output.
Colocation revenue, which covers data center hosting for client computing workloads such as AI training and inference, surged to $10.6 million, nearly doubling year over year. This growth reflected expansions at the Denton, Texas facility. Management described Denton as a cornerstone of the new business strategy, designed to handle high-density GPU clusters for AI customers. According to the company, “The increase was due to the expansion of colocation operations into Denton, Texas during the quarter.”
Hosted mining revenue (where Core Scientific operates miners owned by others) fell sharply to $5.6 million (GAAP). This drop matched management’s ongoing shift away from third-party bitcoin mining to focus on higher-value digital infrastructure services. Segment margins suffered company-wide, with gross margin in self-mining falling to 5% from 28% year over year. The company attributed this decline to cost pressures and reduced production. Overall consolidated gross profit (GAAP) collapsed to $5.0 million, an 87% decrease year over year.
Net loss (GAAP) reached $936.8 million in Q2 2025, most of it from non-cash charges, mainly related to the remeasurement of warrants and contingent value rights. These are financial instruments on the balance sheet that can fluctuate in value depending on the share price or other triggers. Adjusted EBITDA, a non-GAAP measure of operating earnings before certain non-cash and interest items, fell to $21.5 million from $46.0 million year over year.
On the cash front, the company held $581.3 million of cash and cash equivalents as of June 30, 2025, down from $836.2 million (GAAP) as of December 31, 2024. The decrease reflected ongoing capital investments and operating losses. Notably, CoreWeave funded $90.3 million of the $121.3 million in capital expenditures during Q2 2025, limiting direct cash outflows on new data center projects. Cash flow from operations was negative for the six months ended June 30, 2025, though liquidity is still described as strong by management, with additional digital assets on the balance sheet.
Business Initiatives and Market Context
The company’s focus remains on rapidly converting bitcoin mining sites to colocation facilities capable of supporting advanced workloads. This means retrofitting power, cooling, and networking infrastructure in existing buildings to handle racks of servers for applications such as artificial intelligence and large-scale cloud computing.
Core Scientific’s new business with CoreWeave, which specializes in AI-optimized cloud services, is central to the growth strategy. The company expects to deliver 250 megawatts (MW) of billable capacity to CoreWeave by the end of 2025 and reach 590 MW by early 2027. The term "megawatt" refers to the scale of electrical power available for customer use at a data center site; higher MW means the ability to host more or larger computing loads. While this contract supports much of the near-term development, management highlights that revenue concentration risk is high since CoreWeave is currently the major colocation customer.
Management reports that as of Q1 2025, the sales pipeline is expanding, with several potential clients seeking deployments of between 50 and 100 MW. However, no new customers outside of CoreWeave were signed during the quarter. Executives consider diversification of the client base a top priority. Demand from enterprises is described as rising, especially as organizations work to implement artificial intelligence applications that traditional data centers may not be able to support.
The legacy bitcoin mining segment remains an important revenue source, but profitability is under pressure from rising competition, energy costs, and fluctuating digital asset prices. Power fees accounted for $30.7 million in self-mining costs in Q2 2025. Management is focused on negotiating for low-cost power and maximizing efficiency as it balances the legacy business with the ongoing transformation. At the same time, changes in digital asset regulation and energy market rules continue to require attention to compliance and risk management. The company’s capital structure is complex, including over $1 billion in debt and large non-cash warrant liabilities that affect reported earnings.
Finally, a major event during the quarter was the agreement, announced July 7, under which CoreWeave would acquire Core Scientific in an all-stock merger. Each Core Scientific share will be replaced by 0.1235 shares of CoreWeave at closing. This transaction still requires shareholder and regulatory approval and, if successful, could bring additional scale and capital to Core Scientific’s platform.
Looking Forward
Management did not offer explicit forward financial guidance in this earnings release. No investor conference call or accompanying earnings presentation was held.
However, management reiterated existing targets from previous periods, including plans to ramp up billable capacity delivery to CoreWeave and add at least 300 MW of new capacity organically by the end of 2027, with further growth possible through acquisitions. Investors will want to watch for updates regarding new non-CoreWeave customers, progress against construction milestones at existing and planned sites, and continued growth in colocation revenue. Key risks remain, including reliance on a small number of clients, ongoing volatility in bitcoin mining, potential changes to the regulatory landscape, and the execution of the pending merger.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
