Core Scientific (NASDAQ:CORZ) said it has entered a commercial partnership with AMD covering up to 2.5 gigawatts of data center capacity, beginning with approximately 530 megawatts across five campuses under 15-year agreements.
Chief Executive Officer Adam Sullivan said the initial agreements represent more than $14 billion of base contracted revenue and include 2.5% annual escalators. The company now has about 1.1 gigawatts of total contracted billable capacity, representing more than $24 billion of base contracted revenue, according to management.
Sullivan said the AMD credit support arrangements do not include equity step-in rights, which he said protects Core Scientific’s equity investments in the projects. The company also issued AMD a warrant with a strike price reflecting current market levels, subject to certain commercial conditions.
Expansion rights and development plans
AMD has exclusive reservation rights, at specified times and under specified conditions, to lease as much as an additional 2 gigawatts of capacity. Core Scientific said it believes it can make that capacity available through additional grid-connected power, capacity progressing through load studies and behind-the-meter power solutions at Pecos, Hunt and Muskogee.
Management did not provide specific timing for the additional capacity. Sullivan told analysts that the company would work closely with AMD on future requirements and would not discuss capacity covered by the reservation agreement with other prospective customers.
The company said Pecos and Muskogee each have the potential to support up to 1 gigawatt of leasable capacity through a combination of additional grid power and behind-the-meter solutions. During the question-and-answer session, management said behind-the-meter development timelines could be driven by lateral pipeline construction and equipment availability, depending on the site. The company is considering technologies including turbines, fuel cells, linear generators and other alternatives.
Separately, Core Scientific said it has identified a pipeline of more than 2 gigawatts of potential incremental power at new sites, with initial capacity potentially available from late 2028 through 2030. The company said it intends to selectively acquire powered land and develop new locations while continuing to execute contracted projects.
Construction milestones and delivery schedule
Chief Operating Officer Matt Brown said Core Scientific is currently billing for 437 megawatts of capacity, having substantially completed four of five CoreWeave campuses ahead of its prior timeline. The company had expected to substantially complete those sites before the end of summer.
Dalton Phase Two, the fifth and final CoreWeave campus, is expected to begin delivering its remaining 150 megawatts at the end of 2026 and be completed in early 2027, Brown said.
For AMD, Pecos is expected to be the first location to begin delivery, with initial megawatts scheduled for the first half of 2027. Management said about half of the 530-megawatt commitment is expected to be delivered in 2027, with the balance delivered in 2028.
Brown said vertical construction is underway at Pecos, major infrastructure equipment is arriving, and the building shell for the first 185 megawatts is nearing completion. Hunt, Auburn, Muskogee and Dalton Phase Three are advancing through design, procurement, site preparation and construction.
Management said the company had begun developing several AMD-related locations before customer contracts were signed. It had secured long-lead equipment, released capital for substation construction at multiple sites and engaged general contractors and labor resources. Sullivan said the company has equipment secured and contractors on site across the five campuses.
Core Scientific expects all-in construction costs of approximately $11 million to $12 million per megawatt for high-density AI infrastructure. Brown said that estimate includes construction labor, owner-furnished equipment such as transformers, switchgear, generators and cooling systems, as well as engineering, permitting, utility interconnection, insurance, testing and other soft costs.
He said higher costs relative to the earlier CoreWeave program reflect increases in equipment and labor costs, supply-chain constraints, tariffs and differences in site design. Management said labor availability remains a significant construction cost driver in competitive U.S. markets.
Second-quarter financial and funding update
Chief Financial Officer Jim Nygaard said second-quarter GAAP colocation revenue rose sequentially to $137 million, aided by the increase in billable capacity. He said the company expects another meaningful increase in colocation revenue during the third quarter.
Under GAAP accounting, revenue from the CoreWeave contracts is recognized on a straight-line basis over the 12-year lease terms, effectively recognizing contractual escalators earlier in reported revenue, Nygaard said.
Core Scientific continued to wind down its Bitcoin mining operations during the quarter. The company ended June with nearly 30% fewer miners online than at the end of the first quarter and was self-mining at only two sites. Nygaard said mining activity is expected to continue declining through the remainder of 2026 as the business is operated primarily to offset contractual power costs.
Second-quarter cash selling, general and administrative expense was about $36 million, up $4 million sequentially, primarily due to one-time professional fees related to recent debt financing. Nygaard said the company views the low-$30 million range as a reasonable quarterly SG&A baseline, though expenses may vary as it supports growth.
Core Scientific ended the second quarter with approximately $1.8 billion in liquidity. The company estimates the initial AMD build-out will require about $6 billion of capital and expects to finance it through project-level bonds. It also said it is prepared to invest up to approximately $1 billion to advance roughly 500 megawatts of initial future capacity ahead of customer contracts.
Nygaard said the company expects to use project-bond structures similar to those used for its CoreWeave projects. He added that the direct AMD leases and the Neocloud leases backed by AMD credit support would have distinct contractual structures but would be financed through similar project-level vehicles.
About Core Scientific (NASDAQ:CORZ)
Core Scientific, Inc (NASDAQ: CORZ) is a leading provider of large-scale blockchain infrastructure and digital asset mining services. The company develops, owns and operates high-performance data centers optimized for the mining of Bitcoin and other proof-of-work cryptocurrencies. In addition to its core mining operations, Core Scientific offers colocation, hosting and managed services designed to support institutional clients and enterprise users in deploying and scaling blockchain nodes and computing hardware.
Core Scientific’s service portfolio includes hardware procurement, deployment and maintenance, real-time monitoring, power management and network connectivity.
