CORZ - Earnings call transcript Q3 2024

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Operator

Greetings, and welcome to the Core Scientific Third Quarter Fiscal Year 2024 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It's now my pleasure to introduce to your host, Steve Gitlin, Senior Vice President, Director of Investor Relations. Thank you, Steve.

You may begin.

Steven Gitlin

Good afternoon, ladies and gentlemen, and welcome to Core Scientific's Third Quarter Fiscal Year 2024 Earnings Call. Senior of Gitlin, Core Relations Steven Scientific. is Vice Investor President for This all a are this participants At time, in listen-only mode.

We management's remarks. question-and-answer session a will conduct after

As for being conference a purposes. recorded reminder, this replay is

note we statements of XXXX. forward-looking meaning the that Before Securities the please on call, Reform presented within harbor certain safe the Litigation this of Private contains information provisions of begin, Act

performance events facts limitation, achievements, forecasts, Forward-looking other current plan, project, or statement phrases contain without may expect, such or similar or with or any believe, that statements or indicate words future include, historical than predict or anticipate, words meaning. trends, intend, and as estimate,

materially. based involve current that actual uncertainties statements forecasts, and differ cause on risks are and assumptions that may Forward-looking to expectations, results

these presentation only therein. Today's November XXXX. The conference circumstances uncertainties, the is contained update XX-K Form and to Exchange X-K content earnings to filed information discussed to the The and events today contains after undertakes regarding today this factors reflect risk and special on the is further and encourage statements at corescientific.com our contained or report today, the occurring in Presentations the with the of presentation slide call we that company's no obligation information section. and in report release For as in note Commission company's website of Form the current Securities review on on Events annual you accurate and filed available on company X, statements made risks forward-looking today.

Financial Officer, Sterling. Scientific are CEO, me Adam Core and Mr. Joining Denise today Chief Sullivan; Mrs. from

begin with remarks now We from Adam will Sullivan.

Adam Sullivan

I during transformational and Core year this have progress good we the Steve, summarized you, afternoon. for Scientific. Last quarter, Thank made

our I'm progress quarter, continues. report that to This delighted

driving details a significant recent of our achievements for improved I have review We quarter and favorable of our in the on our call third fundamentals with third Denise data before begin for our describe providing with market capital and the balance before creation, and quarter the the will financial briefly summary performance. momentum of growth improvement beyond. we highlighting our demand year center the position infrastructure. I'll strong for today's then more plans value going into our year financials, remainder high-power see substantial structure,

will your take We then questions.

Our last critical and options achieving progress X for the is after X. the CoreWeave quarter. all quarter megawatts, to catalysts IT on our exercised XXX XXXX offered we contractually during additional Slide load described and X final megawatts first third we of committing an XXX Notably, its highlighted of

through Additionally, to meaningful and our we site progress expand capacity made existing new expansions. site acquisition

hosting and consolidate CoreWeave house megawatts additional XXX an HPC new data additional To option With XXX site the existing megawatts our at miners. load. we acquisitions, happy approximately an designated for I'm our increasing for infrastructure Bitcoin our that load. was leased, respect HPC, of total an to to we allocated capacity the have critical IT that announce previously to of megawatts with commitment mining of XXX With secured, to with support we in an of has our our mining center megawatt IT data to completed site mining This Bitcoin Bitcoin business, megawatts IT strengthen critical XX critical potential expansion Pecos, a XX buy, Alabama Texas center to load. to

addition center. Slide of infrastructure on Alabama with and cash revised balance the refinance the our quarter. From we perspective, tapped at during ] the sheet, of for debt our a X put significant structure new X capital summarizes completed We Chapter a quarter. cash updates, $XXX debt, successful debt, to Starting restrictions convertible increase our HPC note significantly improve third highlights X of and hosting our effectively centers partial paying our note in in covenants, enabled behind miner balance million our also off our to data data demolition convertible offering completed sites us. our began the million to $XXX migrations and support that our structure XX sheet the acquisition structure hosting operations finance operational, us with enabled by strategic, [ HPC Slide reducing interest and new capital the rate. eliminating offering add us ability results also strategic our of gave offering and to to the The and August us expand allocation capacity. to financial

and of quarter On the $XX Bitcoin earned the operational we revenue million. in front, X,XXX generated third total

these expenses. HPC diversification revenue the and $X.X quarter $XX our in included and million to Denise explain quarter into we of of segment. hash was halving make mark-to-market operating reflecting driven million post quarter-over-quarter $XX.X equity, quarter, in in our loss from third shortly. To value net warrant detail quarter. more and to adjustments the mainly summarize will lower loss adjusted the third by required $XXX EBITDA $XX share first hosting on in positive made was great our as significant economics progress the business Bitcoin third we HPC in And strengthened our price hosting since as quarter Our the halving. was mining that operating sheet, million April financials, million, balance Gross and appreciation full on momentum the challenging and prices us faced million even higher our showed that loss

this build are We on to momentum. excited

Austin reflects digital X, our which are our including data infrastructure, sites. of Alabama illustrated expanding our as centers, powered on and We Slide updated portfolio

We capacity X,XXX to than also each which include up more of megawatts. gross the contracted adds site,

for call on to to I'd performance like the positioning. financial details more over our Now CFO, our Denise and Sterling, Denise? turn

Denise Sterling

Thank you, Adam.

This Total that offset an by in merit of the compensation, of expense during first deployment of of decreased a mining, post-halving units, cost with of increase performance our or digital Adam in asset quarter asset $XX.X a asset $XX.X million million million from from half Digital in market resulting reflected in of increase new quarter, primarily self-mining fiscal by by depreciation adjustments decrease offset a from in and operational an XXXX. Digital Bitcoin, third the million third self-mining XXX% hosted for This the $X consisted and highlighted XX,XXX made higher quarter units million, approximately in costs increased hosting challenging primarily April the stock-based network partially the $XX.X in halving hash additional revenue the the driven our XXXX. a earned HPC associated self-mining was benefits as payroll from $XX.X the gross price and power well client hash million, added, of the partially result which an during our increase self-mining includes hosting was of in of for self-mining million and margin license of X% Bitcoin quarter fee completed revenue and of increase year-over-year, hosting of revenue, Our execution $XX.X XX%. increase as third of revenue which rate, gross while for quarter. HPC fiscal XX% exceeded million XX% XX% in was in HPC resulted cost. by $XX.X direct Segment revenue digital well revenue number margin of deployment decrease of a XXXX strong, price. was rate. third to the as quarter financial as pass-through the of earlier. new-generation hash of $X.X million base XX% $X cost asset was power as no our by with self-mining from the a that quarter a negative costs GAAP by margin

direct stock-based a adjustment the capacity non-GAAP HPC gross of consists XXXX, direct pass-through to of operations data cost of the the expenses, than At and and expenses revenue pass-through fiscal of gross third hosting the lease XXXX, cost pass-through onetime as and power compensation. The and our power cost, revenue fiscal Non-GAAP benefit ahead XX%. the noncash margin primarily power excluding of is quarter direct excluding related for For expense, XX HPC delivering of more and indirect margin, such is Austin cost data stock-based facilities of XX%. days including compensation, center, schedule. include center third costs, hosting cost, of quarter personnel direct

portion During costs third direct to refine to to these indirect our XXXX, hosting continued revenue HPC allocated of resulted to in a cost allocate cost. of of the segments, quarter operations our methodology being the facilities segment. including This and we our used

in $XXX.X period quarter of was The loss increase our compared period, XXXX. Non-GAAP sites important period net a included period fiscal in for center, the $X.XXX million deliver from costs. costs net additional million for to increase hosting a costs partially million interest advisory to revenue. value by as in with a our period larger also the $XXX.X net million expect increase during of contributors which $X.X be of our no of incurred time prior negative the XX% Power the a for that quarter-over-quarter result the million contracts, the the value XX%, offsetting over third respectively, right to increase due in for we per million, party, terms XXXX services items next and $X.X fiscal our attributable and the year. in hosting site of the to for IT increase over prior increase infrastructure, those where incur without XXXX our expenses the of fiscal for to quarter, not third year. Slide HPC several prior HPC EBITDA bankruptcy asset hosting, stock-based of revenue, Gross costs. Net in hour $XX.X We million in million noncash from quarter required Operating hosting. leased adjustment is totaled significant for X%, to segment and same modifying expenses. A third quarter of year-over-year Other in $XX.X you million third X of the $XX.X personnel or contract generate was and modifying to adjustments. asset which as same for in our self-mining, for $XX.X operating is primarily activity economics loss HPC million declining $X.XXX X. Austin of and million owned contingent $XX.X compensation cost of of data we our hosting vary $X.X in fiscal in remind XX%, and $XX.X $XXX.X reorganization million incurring liabilities primarily related digital were favorable $X.X a million The was adjusted comparable as hosting summary $XX XXXX critical of margins to our were these and million the the significantly increases of expenses and that segment the the expense, $X.X loss and to compared decrease the a It same our was margins kilowatt in improve the equity startup the as associated year. same digital HPC found million offset on quarter a from are to warrants load therefore, of years represents do include mark-to-market our the a net can decrease

vary contracts terms. in power Our and price

previously, mentioned in fleet-wide hour I $X.XXX fiscal per kilowatt third power cost averaged our quarter. As the

We per continue be power to between to average in cost XXXX kilowatt $X.XXX hour. and $X.XXX expect

and in new September miners XX, XXX,XXX we the our during approximately XXXX, self-mining of quarter. As procure miners not operated any fleet did

self-mining mining respectively. XX% hosted XX%, Our to mix was to

mining to mining our to continue this we hosted creating percentage business. decline percentage to single-digit contracts hosting our a As year, HPC self-mining and sunset our fleet, capacity for for hosted expect of our

sheet, equitization secured of $XXX.X stock remaining triggered of would resulting discuss the balance At I appreciation of on Now the starting beginning conversion convertible to in million. price X. our notes, Slide mandatory our the the quarter, the like

full facility Adam completed as XX.X% a on interest pay and sheet. price of our an have exit this terms, notes, conversion additional interest, found notes. and as The the offering at also as the entire we successful loans, Slide Funds October, off rate $XXX representing In can which As $XX strengthened million for August restrictions million third the raised the million new from secured total million in $XXX shares enabled $XX, XX-day share new of $XXX X% on balance $XX which that to be equipment all all offering mentioned, our early much XX, self-mined end to in note plus million. covenants, note the quarter, reduced miner such eliminated of off of of the in us convertible debt convertible miner financing. was we hold conversion. At additional a of $X.X count million approximately in and equipment XX.X our million Bitcoin, an accrued paid

share our count. our equivalents, XX convertible from summarizes of ending liquidity diluted million With forma cash the our the generated enhanced the additional cash offering, $XXX in pro total quarter, up $XX we with XXXX. Slide million and notes from at in end cash

As these XX XX, XX share unexercised. approximately and reserve Tranche XXX conversion X of October of units, warrants, million approximately restricted of million now XX note, I'll exercise mentioned, X would new the related of the items other XX XXXX, Tranche million result count A million. convertible stock our forma warrants, pro total million I total million just remained approximately share plus count was a of Full shares plans. in approximately XXX shares to CapEx the turn million shares. And diluted to X

will part. the we Once reminder, entirely to infrastructure be a require critical new a these power associated out-of-pocket announce is sites, funding additional for contracted, any not from Therefore, associated position Any CapEx for CapEx, may customer any comment megawatts As CapEx whether converting in at to contracts. our in a HPC of expect that currently incremental incremental investments by we hosting load allocations sites contract, CapEx with with of capacity. paid least we IT do is on our XXX our existing not CoreWeave. at or capacity

on Given of business, our Block in focus not half ASIC second to expect fleet the XXXX. our refresh growing our mining procure increase chips Bitcoin HPC we new we until or do the hosting

the that year summarized we Slide megawatt now of this our our of we turn have XXX expansion no CapEx economics Bitcoin I'll center, data business. And review mining further with Texas, mining Bitcoin Pecos, XX. our completed Now a to associated mining on anticipate

operations to Bitcoin power cost This direct of the allocated total direct the divided mine based of dedicated and quarter in fleet facilities XX% cost and our a by consists to in $X,XXX, Bitcoin cash-based self-mining Our of X,XXX. the quarter of third was $XX,XXX cash on $XX,XXX. third cost mined of

cost by of per mining cash-based Another way the terahash expressed per a same as cost items, which hash our costs the evaluate is same calculating day. to cost represent these

a terahash. Cash $X.XX $XX,XXX, XXXX the a in Bitcoin driven Our the The per as earned result by halving, a several hosting allocation as approximately and number power from of to quarter XX% third our cost year April of decrease facilities rate, hosting asset operations cost total XX% the to self-mining year. in in increase cost contracts. in primarily hash increased increase digital year of cash-based quarter mine Bitcoin was by hash higher and cost the by was we offset a year over the during decrease a network sunset over of partially a

the XX-year cost contracts approximately I full found through will the megawatts Now CoreWeave, and margin IT are to over aggregate full updated and overview that utilities the the an total Power project non-GAAP of average and included contract, to on of we have critical million, will contracted on revenue to provide billion, of of XXX be XX% revenue. we both load passed costs XX%. in clients of profit potential contract Slide $X.X and XX. of revenue $XXX revenue annual our Based

cost we operating to details. are expenses now to business. And of HPC Given only in included as costs that growth grow we business of like I'd revenue, this slightly modeling with most increase our share some of the our associated hosting expect

statutory We approximately of continue to effective model tax XX% a for rate XXXX.

million more operating than We carryforwards, will now back the loss also to cash net which Adam. turn $XXX reduce future taxes. And retain call I'll in

Adam Sullivan

Thank you, Denise.

We We believe large are power CoreWeave. for deliver initial GAAP portfolio as shareholders. mining will Bitcoin of from of XXX our gross million our creating accelerate business this critical center IT asset profit load to the clients applying such value more expertise annual for full contracted our industries data megawatts and significant time rate, $XXX expansion to our run the than at in for and

anchor the XXX with initial critical of ambitions our load. business, a extend building are IT our beyond CoreWeave data tenant, megawatts well and We as center

and infrastructure have IT offer with approximately Alabama new critical now recent reallocation XXX site another its plan, with HPC fact, our In of to growth load our clients. to we of to megawatts

Beyond grow hosting our portfolio in ways. to for we infrastructure, plan existing our HPC X

data secure additional power power suppliers. that centers of the we growth. path of more of an end as representing IT partners. certain believe that First, of load this from the XXX capacity capture securing before We megawatts at the much of we will quickest our believe local can We power additional expansion we XXXX, allocation from actively pursuing sites existing our grid are by critical as some to

center completed hosting to expand have additional from portfolios. working HPC of additional including brownfield we convert backup access sites and data tenants been These have sites believe allocations. generators already HPC greenfield b, larger are centers data have can one also sites studies; we centers; lost power typically Second, secure either allocations providers, c, significant our installed chillers a, capacity. to power power their to have distressed and fall These and sites or into we conventional for to pruned with load following may categories: data company their from the options that that have sites

load offers with critical site Alabama as Our as of megawatts much leased would grow approximately in this to to IT critical new XX of to site now to who XX like clients contract IT load. megawatts

We are site securing base this HPC we sites. customer customers hosting. This currently our about for example one with potential of new to is these intend discussion new contracting new by diversify in clients for how

for static to IT depicted X supply secure begin infrastructure communicated. gigawatt to new existing growing to total supply, have as bottlenecks previously These hosting are Slide appear. This of parties of believe and we we Right sites by and coordination. to of closely center securing working of for based that powered that HPC with are tracking business the of the the this to and with sites the the include the third to configurations most considerable solutions temporary success actively to HPC project us. and XXXX. HPC creative others existing to remains working data XXXX, potential requires are of affect now, our is delivery securing developing solutions items area massive hosting. complex our until alternative The we portfolio timing end sites, by components, XX, As the switches, capacity is Key by conversion chain, line of as available our of and a we time, on transfer more on end load expanding switchboards, expect we of first generators. At half we critical sight hosting identify than

IT team better most Bitcoin having one guidance largest our in and experts power Fortunately, lowest this in When experienced within States. With price opportunity We increase revenue-generating a HPC of fleet business fleet with there the us implement price. To the the some data for kilowatt-hour. our center to existing benefit we continue of our Block secured while a improving position rate. revised can the we to be hosting our HPC infrastructure execute United centers data represents that XXX us the next megawatts XX ASIC data our the summarize significant will on $X.XXX mining believe HPC to center, than active power new prices at our also it of ours, efficiency focused program. optimizing enhance of Further, mining and per opportunity center average the we value refresh load highlighted operation preparing for complete, operators Pecos, actions By will the we to increase industry XX, in an hosting, that are power now industry to these strategies mining no data megawatts infrastructure is from to consolidating and our hash lever Bitcoin other of to expanding of sites one hosting using Bitcoin mining we also are believe and we planned critical the contractors expect year and creation conversion is performance. tremendous financial help available Bitcoin Texas, of favorably, it. in $X.XXX business chips Slide on XXXX Bitcoin support

gaining a IT summarized update catalyst, I'd megawatts XXXX and load to growth And regarding in seek contract secure in to newly actively base engaged in so. leader out our by our potential We discussions additional momentum. while compute plans. of cloud on terms. and clients sites. and capacity, you set like diversify XXX clients and revenue AI with on at new digital $X.X sought to secured site remain billion valued next-generation build to and in client last our opportunities. now HPC clients new focus to are expanding include site continues have new begin introduced done critical available their CoreWeave providers. Core Scientific's XX. we hosting new up multiple capacity we to which transformation a our for hyperscalers our into These new over potential Now we we continue on now to for contracts to We with site Alabama, We out all a have Slide XX-year quarter We pursuing infrastructure

acquisitions. critical infrastructure to opportunity very We our positioned hash through as Bitcoin benefit have our to is contract when well site to mining rises. expand have of existing portfolio and additional price new from load to an well approximately franchise XXX our IT megawatts at the existing new clients And as sites

thank I mentioned only for and positioning industry continued teammates our and your at call, and for is the progress partners, As and Thank continue, you clients, value this your our creation and to efforts and for support. ongoing of you our our interest, growth all improving. momentum beginning

We now your take questions. will

Operator

[Operator Todaro & Instructions] John line comes Needham question Our the with from of first Company.

John Todaro

of my follow-ups, if I one, Congrats then on I'll the and here. one use can. results have I

my just And be one as to million have million are site? mentioned. $X to And mining that you're allocate retrofit still customers there? $X First I away in we you can't I specific thinking Bitcoin CapEx, megawatts that follow-up. know going the already HPC, should But with then being conversation that from XXX then you we to give to potential

Adam Sullivan

latency. conversations went were be power, previous go we to at convert earlier whether John, in we potential particular. or looking really in on mining clients, Bitcoin earnings can HPC, site. mentioned yes, down power a need to the what and began order to issue on really actually site the We the having solve comes in site that some call, down year, those back conversations this back we solved with to we environmentals, that comes Based and to it it

for I'll, just been time, conversations then looking quickly these XX on retrofit. I'll megawatts. And really have so, for megawatt at those it's $X John, some question. per And that quite Yes, looking comment million a process ongoing like too million competitive your and $X to the megawatt for we're

John Todaro

a just then follow-up. And

looks So a expected. to the revenue bit it little came like in least HPC higher than we at

I million implies Not thinking think if if $X.X megawatts $XX in like just million the annualized quarter. XX megawatt think and came other $X it's revenue we're at for the a per almost seeing, I million we're I million, I'm it words, that guess, something. on more to sure basis. $X missing in

Denise Sterling

Yes.

the So thanks question. for

XX prepared think, days. onetime I delivery remarks, that actually forward by by we pulled was the that in as suggested with had really our the we a driven adjustment associated fact

delta QX. of are so, which month an seeing in is additional a you is And revenue, there why

Operator

Our comes the Jefferies. line from next question Jon Peterson with of

Jonathan Petersen

Yes.

Just to XXX-megawatt the on follow up transition.

you ahead in -- to way? to start capital your lease that you terms sign cost, construction are along to and guys going you the before Or plan a a of transition? try So is go sign lease the then with in spending are

Adam Sullivan

that we exactly the the know to it viewing and and we a they the contract want to what a exactly period now, Right requirements where is, sizing in they're client get looking to final hopeful we're Jon. know short enough we're way for. Thanks, build, time Yes.

looking And capital to contract so, to perspective, hand. in from having not prior our that we're spend

Jonathan Petersen

of Is then structures be I'm upfront? model financing of or looking we more And slightly my ahead what guys data and myself, I structure all traditional construction future the repeatable, loan would type the capital you at spending but a center a would financing for you see follow-up maybe getting deals? with guess is CoreWeave

Adam Sullivan

we moving Yes, and spending around the their to buy way now clients rate. some of right market down to help CapEx where is see the to is it are portion coming the

right now. rental higher rates seeing are We

to And debt really, XX% on way is funded companies by equity basis the on at generally so looking is that the that's we're to the center a rest it XX% data as check, clients spent the level. financing cover project of and that equity the check, these many finance look to would a looking really the We're rest portion at of we of build-out. project looking

Operator

comes the with line Joseph question from of next Our Genuity. Vafi Canaccord

Joseph Vafi

see all the here. Nice incremental progress to

our power And sites. previous discussions, your on a follow-up. your to updates in HPC above color at some for capacity I expand quick progress you were Any looking Just any XXX going know I CoreWeave? existing to more have on of then the -- there provide megawatts

Adam Sullivan

Yes, of sites. we're What ongoing, about now additional question, Joe. looking existing getting absolutely. HPC above across each right thanks are as this for view those sites. additional And really megawatts and is the our at at our fastest XXX potentially -- XXX conversations we Those still to path megawatts additional

result in at the existing in excited of It a sites. number uplift of especially that megawatts very process. significant each could we're about our So

Joseph Vafi

of mining for be on thoughts and up. That for anything really election broadly specific election good then, Yes. Adam. and Bitcoin's good here, Obviously, obviously, Core? and would sure, presidential the further industry, for Bitcoin the results any implications the And all progress But we other have here more miners. a for maybe that's

Adam Sullivan

of Yes, course.

I past align production, well I future U.S. And think as energy that think has the there really with both intelligence. Trump strong in business tailwinds. artificial well our Bitcoin leadership strong and as X his Those are goals. in our expressed priorities for support and

Operator

Joe line Point Compass Flynn Our of Research. the next comes question with from

Joseph Flynn

this the being site-by-site deal give you do just range into expect some great. changing can these built-to-suit, color being color see hoping and new we some sites potential Should like be Or colocation of there provide similar of basis, you more Any the new the you was would I CoreWeave could some general. structures in colocation? customers on deal? a in

Adam Sullivan

looking single-tenant at on buildings. is the what new for focused for really we're Yes. Really sites

possibly looking get we're really, they're build-to-suit -- size for, really as are at doing So at many of The individual any here lot megawatts looking a site. scale clients clients. and as can for of what potential looking a they lot of for

our our for. as the so, clients, we to they're conversations deep potential are their through sites, each timelines both for looking on of really ensure can design in and teams companies, of the they're And the of exactly based what that requirements these between each engineering and going both evaluate that we looking meet company

So contract, meet a the us bit requires a we design, to where in only that, on to timelines agree to get finalized to chain that upon. just also the both give can more too, have finalized that sides we're but not evaluate color a ensure for at to us little to really supply

Joseph Flynn

we've number color provide maybe about recently. recent on a conversations. you could stories And CoreWeave your seen news of Hoping

been You've and companies to continue an diversifying. megawatts return [indiscernible] add you see But data opportunity ultimately, centers, about speaking to out do as market? build

Adam Sullivan

provides. Yes. we on. news very other the team of because is here, what with they've impressive respect having CoreWeave for cloud been accomplish. lot as CoreWeave providers and able overall the We're amount what in years, to a have to working look terms the vector Really, The to what as seeing big a this conversations well as of a we're across that they're growth Obviously, the in GPU compute going seeing that, both we're continued ride capture cloud the is compute in tailwinds next few on going of and market. over we the view that continue market significant we development to

Operator

Cantor Brett Our Knoblauch comes with Fitzgerald. the from next line question of

Brett Knoblauch

it's Have should -- at happened do rates, market months they deal. in that terms is CoreWeave. first however What the remaining it, maybe coming now on about new out think deal? where or you to quantify want initial CoreWeave with now just the for since rates maybe announced the you to been, of up capacity call online? X has rental how X, Congrats since you capacity the the market think it? Just Adam, we lease gone filling

Adam Sullivan

Brett. their Yes. Thanks, Really, able as think deal unique. XXXX seeing XXX% buy were for in the forward, rather is CoreWeave frankly They what of we look significantly to the rates. we're CapEx. I difference And funding is the down

are willing of to of buildup. given many those able you're rates seeing some definitely XXXX XXXX expected, folks in be CapEx the If that we're much deliver to right cover of higher we portion the and now, lease especially than capacity these

about to value the we excited that few significant we're be seeing rates of amount the currently over going, we're next and demand where believe years. we'll lease a able extract So are from

Brett Knoblauch

you And then guess X different options. new on acquisitions. I site just the maybe outlined

side, million the million distressed data in On existing the distressed in if megawatt the there on are an facility, on side? $X retrofit basis to a what $X it's you center seeing market

Adam Sullivan

Yes. sure retrofit Brett, make the newest you question. I to I about just for the -- And facilities Are those compute? generation clarify asking want to

Brett Knoblauch

pay to retrofit, then you additional would Yes, them running? those sites to and or the to needed acquire have and get CapEx up what

Adam Sullivan

Yes, absolutely.

seeing what it So we're today studies in with. along come market, on of load type depends facilities the those what

XXX infrastructure coming what of depending that's the site. is And on to GPUs. somewhere retrofit available basis, to needs much newest total type Alabama, a $X place the $X $X range to in how of million of and really, on accommodate million a currently infrastructure site generation seeing we're the Really, alongside the acquired in megawatt instance, on the in megawatts. range For gross could $X really be to the at million that megawatts from existing million between per

Operator

question Securities. of B. Lucas next Pipes with the Riley Our comes from line

Lucas Pipes

your prior theme already to little enter on Or the sites, question a many thoughts And on additional has be on competitive of that. how sites? that similar bit these any appreciate in Following speak the room? to could the companies to might the I you desire exclusivity? dynamics, other on occurred potential maybe a would some

Adam Sullivan

teams, where say clients I'll have tours site we're the frequent to engineering is trying we're these and of we on is outline XX about design really consistent both many at clients, focus and There's get that. a meetings there between now that hosting Really, on where deal strong for for of clients, trying makes now to would sense parties. a right I number extraordinarily to meetings Yes. here right demand.

competitive new a XX-megawatt definitely site both there's the as in So process site on Alabama. as well the

to ability both sites. And execute those so, our we of confidence have on high in

Lucas Pipes

now where you make And but Adam, road? it and you AI is sometime a very and or imagine the then, to either sense sites And businesses do quickly overlap -- maybe HPC a robust could growing pipeline, a very taking does have business separate then BTC sense it make a back, some I step have these that both, business. down

Adam Sullivan

execute is grow business. And see we look between teams but also digital represented sites, But to continue right ability to teams increase, Block in Yes. it's It's that represent -- now on high-powered our we we the only definitely our mining efficiency, really, giving our mining really on operate ability hard a HPC transaction that our rate. what the ability to our continue strongly to feel a crossover of going significant we to Bitcoin very hash significant speculate and our as we towards Bitcoin future. And have and a significant infrastructure. evaluate to us XXXX, not to our as each strong

So have businesses. strong X very we

what so, today. happen for And difficult may to is speculate us the on future in

Operator

BTIG. line Our the Tyler next question DiMatteo comes from of with

Tyler DiMatteo

the of, what think notable there Is now full you anchor go CoreWeave you terms secure the new contracted is you as customers with have and capacity you customer? front, megawatts in contract? that anything Adam, do the sourcing has customers full process of have to front guess, now I that on on that of new HPC now, XXX that changed CoreWeave the

Adam Sullivan

credibility. a we're to out That I bases having [indiscernible] different. of definitely and appreciate seeing necessary room the years. question, in these leaders the What of conversations Things walking the We're definitely requirements are very we're that that X with unique in position, providers. the design infrastructure Tyler. and with brings hyperscalers much largest computing we're on operate a building high-performance Things GPUs. the look for different. puts thought with into significant That amount over one are the the it Yes. us is next

like conversations. driver's We're in the So these here we feel in really seat into bringing the we're clients new about business. excited

Tyler DiMatteo

I bringing you the have out some across as custom-built and into of look HPC about I you think look capacity HPC guess, footprint some more some capacity, And for look how on power customers? to laid some of But of the and year you're more bringing as like we does cost next power you as you these the strategy then out here, And what speaking, forecast. more broadly the that follow-up know my building do online? new sites, facilities

Adam Sullivan

Yes.

utilities the But has that we the power that utilities mining many helps expectations as we significantly operate and coming is That just our a Bitcoin into can we in about that a part one power which the our data in team team room we utilities forward, a on business that's our of negotiations of well. walk relationship and very power capacity the the the business. the laid close really new in-house, clients, us center with business other are have potential with excited So with unique where about parts online. who them

at pricing, we about handle think as So power on Scientific something do Core clients. that's that behalf of us our

about so, sites. at And potential as And only excited not power in other many that our of megawatts we're the have that but interested are additional clients think very I we CoreWeave, potential well.

Operator

Capital. with of line Golding next comes Paul the Macquarie Our from question

Paul Golding

Block chip around delivery. first question the My is

those to and to your they'll I and net Given of around BTC you're to infrastructure fleet was just it's the new if chips, going timing if envision progress megawatts XXX in you upgrade? or capacity wondering HPC, going HPC out, up predominantly and conversion be that if how find rollout your lines part Block with that build the from that be

Adam Sullivan

focused exahash, not fleet. are a going give going to really also on only of be new increase efficiency. chips to increase our It's but the Those Block us existing to opportunity refresh

very we're facilities. landing, so, those them about up excited our getting once online And in

Paul Golding

you unenrolling, around capacity. response maybe How talking you're expand as And then conversations, may you you're on and with to conversations quick that demand rate evolving these with site tone from conversion conversations spot it's the these having perspective, follow-up going have enrollment be with if or you are and might your impact those any capacity and are a a conversations noninterruptible With other power. this sure through utilities? power how of utilities approach not having that is that

Adam Sullivan

power high-performance And be sites in we that's between computing. Those rate programs will are some the programs then were we a In be participating structure that than in and question we that different to are rate Yes. as And those regulated voluntary costs. begin bifurcated reduce be those PPAs mining. markets, on new to are on nonregulated will looking a structure sign markets, the regulated that to really Bitcoin we'll deregulated convert these to that for exiting power markets. our are

have well-troddened here our a we capability that's strongly utilities. very we that and So execution process, feel with

Operator

Dede with Our Instructions] Wainwright. comes next of line the Kevin [Operator question from H.C.

Kevin Dede

that you that. more to little issue. I if could You locked mentioned wondering components supply in X you see was color a add just

You that said deal, I target find that workarounds. appears that end-of-first-half I was be happening how you And CoreWeave could could don't static. gensets. your, against see thought you with meeting for which size I the up you wondering think, to

congrats So on that.

chain. relieve the maybe unknowns of the regarding little supply Just a

Adam Sullivan

we look supply confidence we deliveries. at XXXX, chain those locked for in Yes, think up high the Kevin, have I as

help utilized we're that still working traditional years. are of -- we're size XX parts But design that that that things traditional center choices used example, those past development, to those was been different are over gensets these used, that the data XXXX, in things For gensets are alleviate there gensets, the on. even that on evaluating have XX to are of some for

rental looking gaps. areas So we are and certain potential equipment gap bridge coming also up to some of with might help at really we to need in where those the methods of bridge

So we high equipment. due our this execute are demand supply in for ability the have the that confidence presented on high to with complexities chain, the even to

Kevin Dede

you to that machines, those? those imagine mining with have to would facilities do you'd manage to water-cooled are Bitcoin immersion? Block And the or regard retrofit think existing you Okay. And

Adam Sullivan

Yes.

If we are infrastructure the look across air-cooled our leading experts today, facilities. you base really in

focused an that we're temperature coming new on a new in can Block of mentioned for air-cooled at factor maximize. we that out And can particular, even this production designing design these the the chips, high deal really maximize chips ranges. Pecos with so, that's form We've

significant no inside So the in mining refresh infrastructure facilities. Bitcoin those terms of

for So we process install to machines. an believe to be all a or going strong it's these very process us easier

Operator

Odeon. with Rosemary of question Sisson from next the comes line Our

Rosemary Sisson

same of other megawatts changed? now that do? that there identified is HPC thought thought to change megawatts that in process about And you view What to being identified was possibility from this, have process employed Bitcoin? did what could XXX applied you about Or hadn't your you've was there? what the convert to to you that the it prior that Bitcoin The this currently

Adam Sullivan

power both site, with Yes. Rosemary. out, points on gotten that our ensuring be were very We've that Thanks, in particular, that back would the create X laid to It This so power, to to I utility the today. amenable latency. sides. really could was that aspect, that something point contract and focused environmentals, calls we a we

thinking and what specifically that's the utilized of was to going a site that to really conversion undergoing be HPC. So to to for this process led Bitcoin mining convert

rest high each confidence to of there As But to our we and processes. those bring IT in of us right load we continue to now about would where need power, evaluate our on sites to end critical have to ability we'll sites, market. acquire are megawatts up more points now, we in both for the environmentals, continue And the to hard definitely speculate evaluate latency that it's side. and

Rosemary Sisson

new that's megawatts, powered Alabama go has can currently that be? to to get timeframe And site but happen to XX. in actually would for the XX what What to at then XX and the

Adam Sullivan

load approved -- really distressed it that sites that and power. centers come the back of studies one the is data This with to goes Yes. additional

Alabama, in significant it's new that's while clients, is extremely also really what our of finding areas capacity. ability for expand is that in which about would site, amount So megawatts us XX why megawatts. bringing our particular, target to a traditional of But XXXX excited in terms given potential to one attractive on center capacity on data be

Operator

Darren next from Aftahi of ROTH the comes line question with MKM. Our

Darren Aftahi

Just I may. X, if

you about concentrated the power can it process? additional if securing then, you so comes economics? Is was additional you for to on that to existing similar customer site wanted talk process available have would the how today, a on the just what balance the XXX deck, strike months, is the wanting with in that when megawatts by like the if to weeks, have -- HPC, do just XXX And how that economics at deal, it is mean take or and expansion concentration megawatts diversify an CoreWeave First, versus site? And you that customer? years, additional I guys by you is those to

Adam Sullivan

Darren. Thanks,

power the existing for additional that So at utility. process each is sites, for different

load Some of additional studies. them require

Some have terms of about them ramp-up of will and in are negotiations our in where when megawatts. we

we megawatts these our us. really growing execution. think side in with utilities It ability show additional to relationship their what the capture them are I about excited and our movement to and at comes sites of existing now HPC, proof Bitcoin to down down to on comes mining the working

So it of potential get time final there's we as our inside negotiations for of clients said they and helping instances, XXXX. why to be which these can, approved understand of these is But working megawatts, to with additional answer, it some in megawatts some us lengthy a process. they're and to of comes a the is be of to alongside down essence, potential related some to

to about talking the related Now, economics. extraordinarily of deal to data the potential signed your related question deal we're second customer be thinking is in center about attractive. that the to has It CoreWeave Obviously, how best that centers. and ever concentration history data

growth base, that bring tech years. CoreWeave. But for CoreWeave. also would into us And expand business stable and with we we XX have And new diversify client with the think obviously the think to and next companies tremendous fold to gets extraordinarily So to believe term, like to we clients XX with opportunities really we long our do really create that's large continue relationship necessary the over a for us we what our is it's other excited.

Operator

question from the comes Lucas Pipes Securities. of next Riley B. line Our with

Lucas Pipes

long the How I little timeframe share, profit and Is how to any a site that speak back could opportunity. the on in share you did to asset? Adam, that helpful. earnout, just indication it be consideration wanted could Alabama cash? first recognized And go this would for you about take? to much anything you bit when from today,

Adam Sullivan

get lot a of lot diligence due spending working We that a infrastructure here but perform significant of of strong also And low- all utilities. going a our on to to growth. to takes we amount a because ensure due have a time probably diligence. months of as with it's also have side, And in want Lucas. to a really Yes. pathway Thanks, relationship I deal would find those mid-single-digit we're only to qualify is it to not really to finalized time order now that the site this and

we the megawatts out to to As we fantastic. is with that utilities. grow figure XXX ways evaluated site, to want continue And the also

today potentially the megawatts. us, the seeing where our have working number a utilities. You're to of we very the of to relationships across strong sites it expand And with number potential that's important

the option to related a to Now the that lease buy. this consideration, is have we site

want ourselves position don't the a where we And option put So having of to have buy lot But the immediately. necessarily in to a we fixed site us it's buy to provides price. a optionality. at

we of and value. to regardless to that any So our power accrue that perform site, accrues do the additional the upgrade and those

Steven Gitlin

deal add, today by There And filed tomorrow. of that in should is or later Steve. this just to that is additional Lucas, be a description our bit XX-Q

Operator

comes of question the from H.C. Kevin Dede next Wainwright. line with Our

Kevin Dede

us did how just ability you compete could power a to that pipeline more insight Core's numbers. clearly wondering specifically. speaking sites, on some that you're see expand on X and continue and And adding to to access. highlight know and little given you demand But you I'm to pretty portfolio. new give large huge Adam, for market I your you delivered bit avenues maybe

Adam Sullivan

right attractive a sites Yes, through area broker United outstanding run of the There a available processes. right finding most States, There's being sites power now. now. in the to lot focus we're lot which that aren't are absolutely. Thanks, Kevin. of ones our is be And

ground, we through speaking with more finding have that with run are and being boots utilities, the traditional many much ones that broker so, speaking esoteric the than landowners, And on means sites processes.

X ability position unique gigawatts to past, in a to our sites compete. to We've continue deals in ourselves call the And worth ability with It's I'll coming execute a months. of strong market. find So about on the excited putting strong deals us of we're to evaluated we're X it, finding course forward. to over XX the over

So forward XXXX megawatts. Alabama is one we and grow critical to executed we've really load But on. XXXX the IT first look to that to continue here our

Kevin Dede

full could you to not in there, half unit? that wondering timeline. there there? do bit second the expected? room speak maybe I deployment initially I'm suspect the what still the little you're to While mentioned Or you you Block wiggle you make you a or components is need find was some to And be year. know chip you'll all whether next able

Adam Sullivan

working This that much is and only where working longer their long months. time This development for that isn't something This been had something for of has with we've something we for with team been a is working the on a on with period research Block closely been team time. period. them our team

up. the we So manufacturing have of set all

schedule. into Our rollout, terms in our our execution, entire put our game terms plan of in of already

and what about with our also aligned exactly exahash is say, able excited reduce expected, I and increase increase would to to continue exposure. we being and these timeline this or, up So running our we're get and efficiency

Operator

remarks. the That Thank question-and-answer Steve to any call I for closing over back to like concludes our would pass you. session.

Steven Gitlin

wish news all time, SEC we again much, you at for in look industry An we and season, with our a on very no quarter's and Core you a interest results. relevant and website, you good can next archived this Thank Alicia. your attention to filings, joyful With further questions be this call, you forward and holiday corescientific.com. and company day found speaking Scientific. your following of version thank We

Operator

today's you. conclude thank This for Thank participation. does your We teleconference. you

disconnect may lines this time. at You your

Core Scientific (CORZ) 6 Nov 242024 Q3 Earnings call transcript