What's Happening?
Core Scientific, a data center developer, is anticipated to secure significant new customer deals, according to Trip Miller of Gullane Capital Partners. The company, which has shifted its focus from crypto
mining to AI, is expected to announce over 100 megawatts of new deals in the coming months. This follows the rejection of a $9 billion acquisition offer from CoreWeave, which shareholders felt undervalued Core Scientific. The company has about 1 gigawatt of data center capacity and plans to expand by another 1.5 gigawatts. The demand for AI computing power is driving this growth, as data centers face a 47-gigawatt power shortfall by 2028.
Why It's Important?
The anticipated deals highlight the growing demand for AI computing infrastructure, positioning Core Scientific as a key player in this sector. The shift from crypto mining to AI reflects broader industry trends, as companies seek to capitalize on the AI boom. This transition is significant for the energy sector, as data centers require substantial power resources. The potential deals could enhance Core Scientific's market value and demonstrate the viability of AI as a long-term growth area, contrasting with the volatility of the crypto market.
What's Next?
Core Scientific is expected to announce new AI-related leases with third-party clients, expanding its customer base beyond CoreWeave. The company plans to repurpose 400 megawatts of its crypto mining operations for high-performance computing. This strategic pivot could attract more investors and increase its stock value, as analysts project significant upside potential. The broader industry may see more crypto mining firms transitioning to AI, driven by the need for high-performance computing and the challenges of the crypto market.
