Core Scientific has announced plans to cease its Bitcoin mining operations by the end of 2026, transitioning its business model towards artificial intelligence and high-performance computing infrastructure. By 2027, the company aims to operate exclusively as a high-power colocation service provider.
Speaking during the third-quarter earnings call, Chief Financial Officer Jim Nygaard outlined that the liquidation process is expected to conclude in the fourth quarter, with Core Scientific entering 2027 solely as a high-density colocation provider.
Significant Revenue Shift
The company’s latest quarterly results highlight the scale of this operational transformation. Revenue from self-mining plummeted to $12.3 million in the third quarter, a stark decline from $57.4 million in the same period last year. Hosting services revenue from other miners also fell from $8.7 million to $5.2 million.
Bitcoin mining accounted for only $17.5 million of Core Scientific’s total $232.9 million revenue during the third quarter, constituting a mere 7.5% share. In contrast, colocation services brought in $215.4 million.
For those tracking market shifts, platforms like CryptoAppsy enable real-time monitoring of price movements and coin news related to the company’s revenue transition, allowing for a clearer understanding of market impacts during such transitional periods.
Accelerated Exit from Mining
Earlier, Core Scientific announced in its July quarterly report that its hosted mining activities would end by December 31. Concurrently, the company has been gradually phasing out its proprietary mining operations. The latest announcement crystallizes the target date for a complete exit from Bitcoin mining.
Jim Nygaard noted a roughly 50% reduction in the number of miners online by the end of September 2025 compared to previous figures, underscoring the company’s shift towards data center and AI-centric services.
While Bitcoin mining generated $17.5 million in the third quarter, colocation services soared to $215.4 million.
AI Investments Amid Financial Challenges
Core Scientific’s pivot towards AI hosting began with an initial agreement signed in 2024 with CoreWeave, followed by a more substantial deal in June of the same year. At that time, management framed this expansion alongside mining as a growth strategy underlining continued support for Bitcoin mining capacity.
However, deteriorating mining economics strained this strategy. In the first quarter of 2026, a declining Bitcoin price, historically low hashprice levels, and depreciating mining equipment in the secondary market led Core Scientific to record a $266.5 million impairment.
In the second quarter, the company ended its mining equipment agreements with Block and Proto, incurring a $41.9 million loss. Thus, the decision to exit Bitcoin mining reflects both strategic priorities and mounting financial pressures.
Meanwhile, political uncertainty following U.S. election results introduces new challenges for firms investing in AI infrastructure. Increasing opposition from political factions concerned with the impact of large facilities on local resources and electricity bills fuels sector debates.
