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Date
May 6, 2026, 4:30 p.m. ET
Call participants
- Chief Executive Officer — Adam Sullivan
- President — Matt Brown
- Chief Financial Officer — Jim Nygaard
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Takeaways
- Billable capacity delivered -- 243 megawatts fully billing to CoreWeave, including completion and operational transition of the Marble, North Carolina (65 megawatts), and Dalton, Georgia Phase I (30 megawatts) data centers.
- Expected billable capacity -- More than 450 megawatts anticipated by the end of summer, with a full 590 megawatts on track by early 2027, all under the CoreWeave contract.
- Annualized colocation revenue -- Over $350 million GAAP revenue from active colocation as of the quarter, derived from 243 megawatts billing, with revenue recognized on a straight-line basis over a 12-year lease term for the CoreWeave contract.
- Gross profit margin guidance raised -- Target cash gross profit range for the CoreWeave contract increased to 80%-85% from the original 75%-80%, based on greater visibility into costs from ramped billing.
- CoreWeave project bond financing -- $3.3 billion in bonds closed at a 7.75% interest rate, net proceeds approximately $2.9 billion after costs and reserve account funding, enabling accelerated development.
- Capital expenditure outlook -- Roughly $2 billion in total planned for 2026, including approximately $700 million attributed to the Hunt County site purchase, and the Polaris acquisition at Muskogee.
- Pecos site expansion -- Plan to scale from 300 megawatts to 1.5 gigawatts at Pecos, Texas, advancing with an additional 300 megawatts secured, and construction of a 185 megawatt, 431,000 square foot facility underway; all major long-lead items and equipment procured to mitigate execution risk.
- Muskogee site expansion -- Site expansion announced to 1.5 gigawatts gross power (1 gigawatt leasable); development initiated on an 82.5 megawatt building, with first delivery expected in the second half of 2027.
- Customer demand profile -- "Three hyperscalers immediately engaged" upon expiration of prior exclusivity, with additional ongoing discussions involving major hyperscalers, chip makers, AI labs, and Neo Cloud providers.
- Bitcoin mining wind-down -- Mining business to decline throughout the year, with only one or two sites maintaining Bitcoin mining operations by year-end, following earlier monetization of significant Bitcoin holdings.
Summary
Core Scientific (CORZ +11.00%) closed a $3.3 billion project bond at 7.75% interest, with $2.9 billion in net proceeds, giving the company financial flexibility for expansion across multiple sites. Management confirmed colocation revenue from 243 megawatts now covers operating costs and expands margins, representing over $350 million in annualized GAAP revenue. The company's billable capacity is positioned to surpass 450 megawatts by late summer and reach 590 megawatts by early 2027, as contractual execution with CoreWeave advances. Behind-the-meter infrastructure strategies—including gas pipelines and grid-connected solutions—are in development at Pecos and Muskogee to accelerate expansion and reduce supply risks. Labor, equipment, and development contracts have been proactively secured to maintain construction timelines and support growth, with $2 billion in capital expenditures planned for 2026.
- Core Scientific shifted its exclusivity framework, now prioritizing milestone-driven arrangements that allow sites to return to market if negotiations stall.
- Gross profit margin expectations for the CoreWeave contract were increased to 80%-85%, based on operational experience and more accurate cost projections following multiple site billings.
- The transition away from Bitcoin mining continues, with ongoing asset conversion to high-density colocation at major sites.
- Management described its key advantage as execution across five large-scale builds, providing leverage to attract diverse, large-scale customers beyond hyperscalers.
- Pecos and Muskogee expansions leverage both grid-connected and behind-the-meter power models, with redundancy configured up to N+30% for reliability in high-availability customer operations.
- Customer demand is heavily influenced by the company's visible progress toward readiness, and its demonstrated record of rapid scaling, according to management statements.
Industry glossary
- RFS: Ready for Service—date when a facility or data hall becomes operationally available for customer use.
- Behind-the-meter: Power generation and infrastructure located on-site at a datacenter, operated independently from the main utility grid to provide dedicated capacity and reliability enhancements.
- PPA: Power Purchase Agreement—a long-term contract by which a customer purchases electricity directly from a specific energy provider, often used for behind-the-meter solutions to manage cost and reliability.
- N+1/N+2 redundancy: Infrastructure configuration providing one or more additional components (e.g., generators, power supplies) beyond those required for core operations, supporting continued uptime during equipment failure or maintenance.
- Polaris acquisition: The company's purchase of an additional 440 megawatts of power infrastructure capacity at its Muskogee, Oklahoma campus, referenced in relation to overall site expansion.
Full Conference Call Transcript
Adam Sullivan: Good afternoon, everyone, and thank you for joining a platform designed to support the most demanding compute workloads in the market. Over the past year, we have translated that strategy into execution, delivering high-density capacity at scale across multiple states. Those sites were an important starting point; our first customer was never Core Scientific, Inc.’s full story. Delivering these initial sites enhances our operating credibility and provides a significant capital foundation we need to scale meaningfully from here. We have shown clearly our ability to deliver at scale. Across five sites, we are now developing one of the largest multisite AI infrastructure buildouts in the market.
We are now earning revenue on approximately 245 megawatts, with another 200 megawatts expected to be earning revenue in the coming months. Our execution, combined with the favorable structure of our CoreWeave contracts, has enabled our next phase of growth. Today, we closed on a $3.3 billion capital raise supported by that contract, with the proceeds to be used for future growth and the development of projects for other customers. The fact that we have five facilities fully leased and financed by our tenant is a meaningful differentiator. We have the ability to push the next phase of development in a disciplined way by securing the land, labor, and equipment to protect timelines and accelerate delivery.
As these new projects are leased, we expect opportunities for further financing to continue the cycle of our forward development go-to-market strategy. Our next phase of development has already begun. In late last year, we committed existing cash on hand to purchase equipment for our other existing sites. With the new secured financing, we are now accelerating development activity across multiple sites including Pecos, Muskogee, Hunt, Dalton Phase III, and Auburn. This positions us differently in the market. We are not waiting for deal negotiations to conclude before advancing sites. With capital in place, we can move early, bringing RFS timelines within the 12 to 14 month time frame that customers are actively trying to solve for.
We are also scaling our campuses in a repeatable way. Today, we announced a path to approximately 1.5 gigawatts at Muskogee, closely following a similar plan. A key enabler of that scale is our power strategy. Customers are increasingly focused on solutions beyond existing grid capacity, including behind-the-meter options. We are proactively positioning our sites to support those needs, including efforts to secure natural gas infrastructure where appropriate to enable future expansion. Pecos is a clear example. We are actively converting the site from Bitcoin mining to high-density colocation with construction already underway and a pathway to RFS within 12 months. Muskogee is another.
We see a path to 1.5 gigawatts of gross power supported by grid expansion, the Polaris acquisition, and behind-the-meter solutions, and we expect to deliver additional data center capacity outside of our current contract in late 2027. Stepping back, we are executing a repeatable model: secure strategic sites, invest ahead of contracts where appropriate, and create assets that are increasingly compelling as they approach readiness. That brings me to our commercial progress. We are engaging customers from a position of strength. Because development is already underway, our timelines are not dependent on contract timing—an important distinction in this market. As we previously discussed, we are engaged in an exclusivity process with a hyperscaler across Pecos and Muskogee.
That exclusivity is now expired. However, three hyperscalers immediately engaged on those same sites. We are now in active discussions. This reinforced both the strategic value of these assets and the depth of demand for large-scale, high-density capacity. It also informed how we approach exclusivity going forward. While it likely remains a necessary part of some deal negotiations, it must also include clear milestones. In a market like this, we will not keep high-value assets off the market longer than necessary. More broadly, our conversations with potential customers have increased significantly since the beginning of the year. Hyperscalers remain our primary focus and we are also seeing growing engagement from chip makers, AI labs, and Neo Cloud providers.
These emerging customer segments represent meaningful opportunity, though they often require additional credit support. We are actively working with customers and financing partners on structures that can support long-term financeable commitments. Stepping back, our position is clear. We are building a scaled, high-density digital infrastructure platform with a diversified site portfolio. We are deploying capital to secure timelines and accelerate delivery. We are also seeing strong customer demand. Based on our execution, capital position, and commercial momentum, we are confident in our ability to continue expanding and creating long-term value for our customers and our shareholders. With that, I will turn the call over to Matt Brown to provide more details on our operations and development progress. Matt?
Matt Brown: Thanks, Adam. As we reflect on the first quarter, our operational priorities remain clear: execute on our existing build pipeline, bring capacity online efficiently, and position the business for the next phase of large-scale expansion. Demand for high performance compute infrastructure remains strong, and we have focused on aligning our delivery timelines, supply chain readiness, and power strategies to meet that demand. I will begin with an update on our CoreWeave dedicated facilities, where we continue to execute at pace and at scale. Today, I am pleased to announce that we have delivered 243 megawatts of billable capacity to CoreWeave.
This includes a milestone with a full turnover of both our Marble, North Carolina and Dalton, Georgia Phase I data centers. At Marble, we completed construction and successfully transitioned the entire facility into operations, bringing 65 megawatts of billable capacity online. At Dalton Phase I, we likewise achieved full site handover and delivered 30 megawatts into service. These milestones reflect the team’s ability to execute efficiently at scale, transition assets seamlessly from construction to revenue generation, and consistently align to customer timelines—all of which remain critical as we continue to move forward.
Across our remaining contracted sites, we will continue delivering billable megawatts over the coming months while scaling execution on the CoreWeave contract, positioning us to deliver more than 450 megawatts billable by the end of the summer, while remaining on track to deliver the full 590 megawatts by early 2027. Now turning to our non-CoreWeave developments, where we are advancing our development strategy. Our Pecos, Texas campus is one of our most significant development opportunities, with a plan to scale from 300 megawatts to 1.5 gigawatts through a multipronged expansion strategy. At the core is our power roadmap. We have secured an additional 300 megawatts and are advancing a mix of grid-connected and behind-the-meter solutions to support long-term growth.
The behind-the-meter strategy leverages low-emission generation and includes the construction of a linear gas pipeline to the campus. Together, these efforts are designed to accelerate time to power, enhance resilience, and reduce supply chain risk while enabling us to meet hyperscale demand. In parallel, construction of our initial 431 thousand square foot, 185 megawatt facility is progressing from civil work into foundation phases, with precast walls arriving for vertical construction. All the long-lead items and equipment have been secured, helping reduce execution risk and support timelines. We are also advancing infrastructure for high-density colocation, including redundant fiber capacity and a new regional interconnect point in Midland, Texas, linking back to the Pecos campus.
At our Muskogee, Oklahoma campus, today we announced plans for the expansion of the site to 1.5 gigawatts of gross power, or approximately 1 gigawatt of leasable capacity. Similar to Pecos, this expansion will leverage a combination of behind-the-meter infrastructure and utility-supplied power, including the roughly 440 megawatts acquired through the Polaris transaction. With our general contractor already secured on-site, we have begun development of the first 82.5 megawatt building with initial delivery expected in the second half of 2027. And finally, turning to other development sites: Hunt County, Texas; Dalton, Georgia Phase III; and Auburn, Alabama each continue to advance through preconstruction milestones and remain on track to meet their initial delivery timelines.
In closing, as we look ahead, we remain confident in our ability to execute against our commitments and capture the opportunities in front of us. The combination of strong demand, a growing portfolio of scale developments, and continued progress on our power infrastructure strategies position us well for the quarters ahead. With that, I will turn it over to Jim.
Jim Nygaard: Thanks, Myles. During the first quarter, we reached an important inflection point as our colocation revenue scaled to a level sufficient to cover operating costs and began expanding margins. This marks a meaningful milestone in our transition, with colocation now becoming an important driver of our overall financial profile. Today, we are billing for 243 megawatts, which equates to more than $350 million of annualized colocation GAAP revenue, with significant additional capacity expected to begin billing over the next several months. As a reminder, under GAAP, revenue from the CoreWeave contract is recognized on a straight-line basis over the 12-year lease term, effectively pulling escalators forward.
From a Bitcoin mining perspective, we remain focused on optimization and are running that business to help offset contractual power costs as we continue the transition toward high-density colocation. Going forward, we expect mining activity to continue winding down over the course of the year, with a meaningful step down in miners online in the second half. Earlier this year, we monetized a significant portion of our Bitcoin holdings and currently retain only a modest amount of Bitcoin on the balance sheet. Moving on to costs, first quarter SG&A on a cash basis was just over $30 million.
While we are not providing explicit SG&A guidance, we believe this level represents a reasonable baseline for corporate expenses going forward, with the potential for opportunistic investments to support growth over the next few years. Separately, you may have noticed that we increased our target cash gross profit range for the CoreWeave contract to 80% to 85%, up from our original target of 75% to 80%. We first introduced that target roughly two years ago, and today we have much greater visibility into the associated cost structure given we are now billing for a meaningful portion of the contracted megawatts. With that operating backdrop, let me turn to capital formation, where today marked another major milestone for Core Scientific, Inc.
We closed our previously announced $3.3 billion CoreWeave project bond financing at a 7.75% interest rate, which we view as a highly attractive cost of capital for a financing of this scale. After closing costs and funding the required debt service reserve account, net proceeds were approximately $2.9 billion. For additional context, the bonds include a lockbox structure, which is a cash control mechanism where project revenues are paid directly into a designated account and then applied through the indenture-defined cash waterfall—first to operating expenses, then to debt service, and finally to other uses permitted by the indenture.
Unlike a traditional project finance structure, where a lockbox is created to fund a specific project under development, our structure enables the distribution of the vast majority of offering proceeds up to the corporate level to facilitate investments in a variety of new projects outside the box. Going forward, the lockbox will service the debt secured by CoreWeave contracted site assets and cash flows. From this perspective, the transaction significantly strengthens our consolidated capital position, validates the quality and predictability of our contracted cash flows, and gives us the ability to execute the next phase of our growth plan with greater flexibility, speed, and certainty. We expect to deploy roughly $2 billion of total capital expenditures in 2026.
This includes approximately $700 million for both the Hunt County, Texas site acquisition, which closed yesterday, and the Polaris acquisition at our Muskogee, Oklahoma site announced earlier today, as well as expenditures to begin pre-seeding approximately 1 gigawatt of new billable capacity. This includes long-lead-time equipment procurement and various site development and utility support activities across multiple project locations. We are strategically positioning the business to sign attractive new customer contracts with capacity outside of CoreWeave available for delivery starting in early 2027. The platform we are building, together with cost-effective capital we have secured for new project equity investments, is differentiated in the market, and we believe it positions Core Scientific, Inc. to create meaningful long-term shareholder value.
Lastly, we recently welcomed Jorge Rey as our Chief Accounting Officer, further strengthening our finance and accounting team. Jorge brings valuable accounting and public company reporting experience, and his leadership will be important as we continue to scale the business and support our next phase of growth. I will now turn the call over to the operator for questions. Thank you.
Operator: We will now open the call for questions. Our first question will come from Brett Knoblauch with Cantor Fitzgerald.
Brett Knoblauch: Hi, thanks for taking my question and congrats on the site expansion at Pecos and Muskogee. I guess maybe just on the hyperscale exclusivity that expired—clearly, there is demand with additional tenants kind of backfilling that—but could you maybe shed light on why it expired, why it did not progress? Is there anything that maybe the sites were not of interest or that they were not interested in, or just give some more color around that dynamic?
Adam Sullivan: Yes, absolutely. And thank you, Brett. Those sites, as you mentioned, are incredibly attractive—both Pecos and Muskogee, given their ability to scale, represent tremendous opportunity for a hyperscaler. As we noted in prepared remarks, three hyperscalers immediately engaged. They are incredibly attractive sites. With the one that we were under exclusivity with, it is hard to determine the exact reasons why, but for us, we got to the end of the exclusivity and we thought this is the best time for us to bring these back to market. Hyperscalers were knocking at the door and asking questions about the sites. We knew we could have an opportunity to bring another hyperscaler into the fray.
So we feel great about our position today, given the competitive dynamic.
Brett Knoblauch: Perfect. And maybe just one follow-up. It seems like the AI pendulum is swinging into full bull mode here, and you guys do have a lot of capacity available to the kind of RFS by early 2027. Do we think we are closer to maybe a second tenant today than we were when you guys reported 4Q in early March?
Adam Sullivan: Yes. When you look across our site portfolio, we have five sites with first data halls RFSing in 2027. It is an incredibly unique position, given the different size and scale and geography spread that we have inside our portfolio. We are in conversations with all of the hyperscalers, chip makers, AI labs, Neo Clouds. We are in a unique position here just given the asset spread that we have, and so I would say definitely across the entire site portfolio, we are closer than we were before.
Operator: Our next question will come from John Todaro with Needham and Company.
John Todaro: Congrats on the expansion of power. Two from me. Going to the other three hyperscalers you are now in conversation with—if we frame it up, was there already some dialogue at some point? It is a limited universe. Should we be thinking it is kind of starting the process anew with them, or there has already been some dialogue along the way and you are pretty far along, and we could get something maybe a bit sooner than necessarily restarting the process?
Adam Sullivan: Thanks, John. Our relationship with these groups is not new. We are engaged with them on other sites. This was just really bringing both Pecos and Muskogee back to the table, and that is really why we were able to immediately reengage with those customers.
John Todaro: Got it. Understood. That is very helpful. And then you mentioned starting some of the process on building out some of these assets before a lease gets done at some of them. Is there any guardrail on how much CapEx you would start putting forward before getting a lease?
Adam Sullivan: Yes. The way we are thinking about it right now is we want to take the first data hall to full RFS. As part of that, that means we are securing the labor, securing the trades, securing long-lead equipment, and putting ourselves in a position where, if a customer signs any time leading up to the RFS of the first data hall, we can just continue to extend all of that labor that we have secured on-site. That is our guardrail right now.
We feel very confident in the strategy, and the ability to show the progress that we are making across each of these sites to customers is really what is forcing the engagement here, because everyone is incredibly interested in capacity that is getting delivered in 2027 right now.
Operator: And we will go next to Analyst with Oppenheimer.
Analyst: Do you have a rough idea when you might sign a contract? And can you maybe just talk about the pricing trends at a high level?
Adam Sullivan: I would just say we are actively engaged right now across every major group, and we feel very confident based on where we sit today versus where we sat three months ago. The only thing that has changed is our assets have continued to build more value, we have continued to deploy more capital, and we have continued to get closer to the RFS state. So we have high confidence in the customer conversations that we are having today. If you could just remind me, what was your second question?
Analyst: What are you seeing in the pricing trends? With the pricing of the new contracts, do you expect—
Adam Sullivan: I think you are going to expect to see pricing continue to firm up. Really, that is the result of both labor and equipment continuing to inflate, and so you are seeing a similar move in pricing.
Analyst: And then just lastly, behind-the-meter power—can you give us a sense of the lead time on that? And ultimately, how will your costs for build-your-own versus the grid compare?
Adam Sullivan: Right now, what we are looking at is deploying behind-the-meter solutions anywhere from about 12 to 14 months. The great part for us is these are opportunities, given the locations that we have available to us, that really represent great opportunity for continuing to expand at those sites. The other site that we have not talked about—Hunt—has the opportunity to potentially bring behind-the-meter, but that is something that we are still in the evaluation phase today. We have not necessarily done as much of the due diligence that we have done across Pecos and Muskogee in the work that is currently being performed there.
Analyst: And is the ultimate cost to a customer about the same as grid, or a little bit more?
Adam Sullivan: It is about the same. The economics for us as developer look very similar, so the cost to the end tenant too, on a blended basis for power rate, is not materially different.
Operator: And Michael Donovan with Compass Point has our next question.
Michael Donovan: Hi, guys. Thanks for taking my question. So, another question on behind-the-meter. The Muskogee announcement this morning referenced Oklahoma’s behind-the-meter legislation. Can you explain what that legislation changes for Core Scientific, Inc.’s ability to develop and whether it gives Muskogee a timing or cost advantage versus opportunities in Texas?
Adam Sullivan: Governor Stitt has been a big advocate of bringing behind-the-meter opportunities to the state of Oklahoma. You saw Governor Stitt’s quote in the press release today. Oklahoma is focused on figuring out how to bring more generation to the state. Our ability to execute in Oklahoma is not necessarily any easier or any more difficult than our site in Pecos, but we definitely have the support of the government there to continue to bring more generation to the state.
Michael Donovan: Great. Thanks. And one follow-up, if I may. Have you contemplated owning the generation assets, or would you be solely partnering with a power developer? And then how are you thinking about redundancy?
Adam Sullivan: I will take the first part of that question and then I will hand it over to Matt to take the question about redundancy. As we evaluate the behind-the-meter solutions, there are potentially some solutions that we would own ourselves, and there are others that we would work through a third party that would provide us a PPA, which would be included in the power price over time. There are a few different methods we could go down. It really just comes down to the economics question as well as who the behind-the-meter solution is from. Matt, do you want to talk about redundancy?
Matt Brown: Yes. To include in that is the maintenance and operation of the behind-the-meter generation, which would come along with that PPA agreement as well. From a redundancy standpoint, when we are building behind-the-meter, redundancy becomes much more critical for high-availability services. We need to be able to support the full load of the portion of the campus that we are powering from behind-the-meter under maintenance conditions—meaning we need to be able to take some of that equipment offline for maintenance, maintain full load, and have redundant capacity still online and available in the event of a failure. You can almost think about that as at minimum an N+1 configuration—maybe an N+2 or an N+20% or N+30% type of redundancy scheme.
Operator: Moving on to Joseph Vafi with Canaccord.
Joseph Vafi: Hey, guys. Good afternoon. Congrats on the progress. Thanks for taking the question. Just wondering how you are managing the labor side of the builds here. I am not quite sure if you are employing a few large GCs on the build, or are you looking at construction labor as any constraint in the market right now? Thank you.
Matt Brown: Great question. Labor is one of the primary constraints of the market, depending on which market we are talking about. Nationally, labor is a big issue. It is one of the reasons why we think we have an advantage by being able to proactively invest in development of these sites—being able to secure and tie up the labor through our projected RFS and scaling beyond that. In terms of how we are doing that, we have a couple large GCs executing our sites’ development today, and those GCs have a lot of leverage in the marketplace, being able to secure electrical contractors, mechanical contractors, civil, etc.
All of those—except for probably one site—are already fully mobilized and executing our development as we speak.
Operator: We will go to Paul Golding with Macquarie Capital.
Paul Golding: Thanks so much and congrats on the progress. I wanted to ask on these behind-the-meter opportunities that you have been discussing. You mentioned you might partner with someone who would give you a PPA or you might look at an opportunity to do it yourself behind-the-meter in terms of generation. How is the air quality component of that structured, or how do you see that potentially being structured? Do you have to still go to market and apply for those emissions permits, or would a partner that you are speaking with already have that in hand? And then I have a follow-up. Thank you.
Matt Brown: Yes, great question. As we mentioned in our prepared remarks, the technologies that we are going to get behind and support for all of our behind-the-meter sites will be technologies that are low emissions generally. That gives you a little bit of insight as to what we are not thinking about from that standpoint. On the permitting standpoint, yes, we will certainly have to go and apply for air quality permits for many of these deployments. In some cases, that will be in participation with the behind-the-meter operator or supplier, and in other cases, we will be doing that on our own.
In both Pecos and Muskogee, we are already far down the path of our air quality studies for the implementation of those solutions.
Paul Golding: Got it. Thanks so much. And I was just hoping you could also give a little more detail around some of the puts and takes that enabled you to raise the run-rate margin profile on the existing energized and billable capacity from that 75% to 80% to 80% to 85%. Thank you.
Adam Sullivan: Two years ago, when we signed the original CoreWeave contract, we had a scope of service contemplated in that deal, and we had an element of conservatism knowing that we had not broken ground on the project at that point and that we were going to be deploying over a fairly lengthy period. Once you are two years after the fact and into it, we have more experience under our belt on the number of actual heads that are going to be devoted to the activities and the contractors that we are using and have actually deployed on-site. It is really just a true-up of that experience.
We feel good that we are at a margin level that we can deliver today, and we felt more confident that we could be a bit more prescriptive on where we think we are going to end.
Operator: And our next question comes from George Sutton with Craig-Hallum.
George Sutton: Thank you. As you begin to market to the chip makers and the NeoClouds, I am just curious—do you have a bifurcated sales portfolio where some of the sites and maybe even parts of locations are being marketed to those folks versus the hyperscalers? How is that working through the system?
Adam Sullivan: We are showing both chip makers, Neo Clouds, and labs the same sites that we are also showing to hyperscalers. As we work through these processes, oftentimes they are migrating to one or another site, but in reality, we are showing our entire portfolio to each of the customers that come through our door.
George Sutton: And one other question relative to executing ahead of the contracts. How does the negotiation get altered with some of these potential customers when you have secured the supply chain and you are moving forward? Does that accelerate discussions? Does that keep them more engaged? Can you walk through that thought process?
Adam Sullivan: It definitely keeps them more engaged. They rarely see sites that come across their desks with an RFS timeline within 18 months, and even less than that. For us, being able to show photos and videos of sites with active construction going on and the list of equipment that is on order changes the dynamic of the discussions, because this is not just a photo of a piece of land. This is an active construction site actively progressing towards building a data center.
Operator: We will go next to John Hickman with Ladenburg Thalmann.
John Hickman: Hi. Thanks for taking my question. This is a little bit esoteric, but now that you are well into your buildout for CoreWeave, could you comment on the experience—what was harder than you thought, what was easier, and where do you think you have a competitive advantage now that you have put that many megawatts into production?
Matt Brown: It is a great question. Reflecting on that, the thing that was much more difficult than we gave it credit for was executing on brownfield conversions, which is why everything you see that we are doing forward is actually a greenfield site with a highly standardized basis design. That allows us to get leverage over our supply chain and be super predictable in terms of our delivery dates. Brownfield sites are highly unpredictable, require a lot of customization, and it is a lot of effort to try to retrofit an existing building. While sometimes that can be faster, it comes with a lot more complexity. That is probably one of our biggest lessons learned.
John Hickman: Okay. And competitively, now that you have learned that, where do you think you are versus other people that are trying to build data centers?
Matt Brown: The great part is that we have had five sites to practice on, and we have been executing these high-density builds across all the CoreWeave locations. We have been able to iterate on those designs—we have executed more than 150 design changes along the way across the portfolio—and that gives us a bit of a head start in terms of what does not work and what works well. All those learnings have culminated into a go-forward build strategy. We have the advantage of learning those lessons firsthand in real time, so we will not make those mistakes going forward.
Operator: And our next question comes from Henry Hearle with B. Riley Securities, on for Nick Giles.
Henry Hearle: Thank you, operator. I wanted to ask about the change in your approach to exclusivity. In what scenarios would you go into it? And then you also mentioned being in contact with several counterparties. Would you expect to announce exclusivity if you were to enter into one? Thanks.
Adam Sullivan: Thanks, Henry. I would not say that we would expect to announce in the interim between quarters. What we have migrated to is moving to a milestone arrangement method, which allows us to ensure that the cadence is moving at the pace that we would expect in a deal that would move towards closing. That allows us to bring a site back on market if we do not feel like the pace and cadence is where we would like it to be. We have migrated to this strategy, we are on it now, and we feel like it gives us the best shot on goal given the demand that we are seeing in the market today.
Henry Hearle: Understood. Thanks for that. And then on winding down your Bitcoin mining operations in the coming quarters, do you have a definitive target date to be fully out of that business, or will it act as a small hedge going forward? Thanks.
Adam Sullivan: Over the course of the remainder of this year, the Bitcoin mining business is going to continue to migrate lower, and by the end of this year, we will only have one or potentially two sites operating Bitcoin mining.
Operator: Moving on to Steven Glagola with KBW.
Steven Glagola: Hey, thanks for the question. Adam, I just wanted to touch base again on the challenges on securing the leasing commitments at Pecos and Muskogee. From my standpoint, it would seem like you have strong leverage there—the sites have near-term power, you can point to your execution in the CoreWeave buildout to date. Are you seeing hyperscalers become more selective in their choice of development partners, and if so, how is that influencing demand or deal timing?
Adam Sullivan: The exclusivity that expired—the customer is still at the table and still interested in those sites. Broadly across the market, you are seeing repeat deals across some of the developers, especially on the private side, so I would agree with that. They are also looking for experience in the development of this type of infrastructure. This is different than traditional data center infrastructure. Given the experience that we have and our ability to show them five sites that we built, plus 590 megawatts in progress of critical IT load, that is a differentiator and puts us in a different bucket.
As you mentioned, we have great experience building, we have sites under construction, and it really puts us into a pretty unique category in this industry.
Operator: Thank you. This now concludes our question and answer session. Ladies and gentlemen, thank you for your participation. This does conclude today’s call. You may disconnect your lines and have a wonderful day.
