Core Scientific Shares Drop

Shares of Bitcoin (BTC) miner Core Scientific (CORZ) fell 15% in pre-market trading on Thursday following reports that Microsoft (MSFT) has scaled back certain agreements with CoreWeave, a cloud computing firm set to go public soon.

Last month, Core Scientific announced plans for a $1.2 billion data center expansion in collaboration with CoreWeave. This week, CoreWeave filed for an initial public offering (IPO), aiming to raise $4 billion at a $35 billion valuation.

According to a Financial Times article, CoreWeave, which provides artificial intelligence (AI) computing power to Microsoft, has been experiencing delivery issues and missed deadlines, prompting Microsoft to reduce its commitments, although it remains a significant partner.

Microsoft contributes 62% of CoreWeave’s revenue and has committed over $10 billion to its services by 2030. CoreWeave has seen rapid growth, generating $1.9 billion in revenue for 2024, yet still posting considerable losses.

The company heavily relies on Nvidia’s (NVDA) AI chips and has raised $14.5 billion in debt and equity. Microsoft’s decision reflects a shift in its AI infrastructure strategy, although it continues to invest significantly in the sector.

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