Core Scientific abandons cryptocurrency mining operations as AI hosting dominates revenue
By the close of 2026, Core Scientific will completely phase out its Bitcoin mining operations, transitioning fully to artificial intelligence data center services as cryptocurrency mining contributes merely 7.5% to total revenue.
According to Core Scientific, the company anticipates a complete withdrawal from Bitcoin mining operations before the conclusion of 2026 as it transitions its operational focus toward artificial intelligence infrastructure and high-performance computing services.
"We expect to complete the wind-down during the fourth quarter and enter 2027 as a pure-play, high-density colocation provider," said Core Scientific chief financial officer Jim Nygaard during a Q3 earnings call on Thursday.
The company had already revealed in a quarterly regulatory filing submitted in July that its hosted mining services would conclude by Dec. 31 as it proceeded with winding down its proprietary mining activities. This recent statement provides a definitive timeline for the comprehensive termination of all Bitcoin mining endeavors.
The most recent quarterly financial results demonstrate the dramatic transformation of the business model. Revenue from self-mining operations in the third quarter declined to $12.3 million from $57.4 million recorded in the same period one year prior, while income generated from providing hosting services to external miners decreased to $5.2 million from $8.7 million.
Cryptocurrency mining operations contributed only $17.5 million, representing 7.5% of Core Scientific's overall third-quarter revenue of $232.9 million, in stark contrast to the $215.4 million generated through colocation services.
The firm operated nearly 50% fewer mining machines at the conclusion of September compared to the end of 2025, according to Nygaard.
Core Scientific pivot to AI
The company's strategic transition into artificial intelligence hosting infrastructure began materializing in 2024 following the execution of an initial hosting contract with CoreWeave in March of that year, which was subsequently followed by a substantially larger agreement announced in June.
During that period, Core Scientific characterized AI hosting as a complementary expansion that would operate in tandem with its existing mining operations. The company's June 2024 public statement specifically highlighted its commitment to maintaining Bitcoin mining capabilities.
However, by December 2025, The Wall Street Journal published reports indicating that Core Scientific was already establishing objectives to cease its Bitcoin mining activities by 2028.
The economics of cryptocurrency mining created additional challenges in the subsequent months.
In the first quarter of 2026, Core Scientific documented $266.5 million in impairments related to mining assets, attributing the write-down to diminished Bitcoin valuations, record-low hashprice levels and declining market values for digital asset mining hardware in secondary markets.
Throughout the second quarter, the company cancelled its mining equipment contract with Block and Proto, documenting a $41.9 million financial loss as part of the business transformation.
US midterms bring scrutiny of data-center growth
The strategic withdrawal from mining occurs amid heightened uncertainty for enterprises expanding artificial intelligence infrastructure following the US election outcomes.
Critics and opponents of data-center expansion were among those who benefited from the Democrats' comprehensive midterm electoral victories, Reuters reported Wednesday.
The opposition movement is driven in part by concerns regarding electricity costs and the strain that massive facilities impose on community infrastructure and resources.
Cointelegraph reached out to Core Scientific for comment.