Core Scientific (NASDAQ:CORZ) executives on Tuesday outlined progress in scaling the company’s high-density colocation business, detailed a major project financing tied to its CoreWeave contract, and discussed an expanding development pipeline aimed at delivering additional AI infrastructure capacity beginning in 2027.
On the company’s first-quarter 2026 earnings call, CEO Adam Sullivan said Core Scientific has moved from strategy to execution “delivering high density capacity at scale across multiple states,” and framed the delivery of its initial sites as establishing operating credibility and a capital foundation for the next phase of growth.
Colocation ramp and CoreWeave delivery milestones
Brown said the company expects to continue delivering additional billable megawatts “over the coming months,” and is “positioning us to deliver more than 450 billables by the end of the summer, while remaining on track to deliver the full 590 megawatts by the early 2027.”
Chief Financial Officer Jim Nygaard said the first quarter represented an inflection point as colocation revenue scaled to cover operating costs and begin expanding margins. “Today, we are billing for 243 MW, which equates to more than $350 million of annualized colocation GAAP revenue,” Nygaard said, adding that more capacity is expected to begin billing over the next several months.
Nygaard also reminded listeners that CoreWeave contract revenue under GAAP is recognized on a straight-line basis over the 12-year lease term, “effectively pulling escalators forward.”
$3.3 billion CoreWeave project bond financing closes
Sullivan said the company closed on a $3.3 billion capital raise supported by the CoreWeave contract, with proceeds intended for future growth and developing projects for other customers. Nygaard provided additional details, saying Core Scientific closed its previously announced $3.3 billion CoreWeave project bond financing at a 7.75% interest rate.
After closing costs and funding a required debt service reserve account, Nygaard said net proceeds were approximately $2.9 billion. He described the bonds’ lockbox structure as a cash control mechanism in which project revenues are paid into a designated account and then applied through a defined cash waterfall—first to operating expenses, then to debt service, and then to other permitted uses.
Unlike some traditional project finance arrangements, Nygaard said the structure “enables the distribution of the vast majority of offering proceeds up to the corporate level to facilitate investments in a variety of new projects outside the box,” while the lockbox will service debt secured by CoreWeave contracted site assets and cash flows.
Development pipeline: Pecos, Muskogee and additional sites
Management emphasized a strategy of advancing development work before contracts are finalized to compress customer-ready timelines. Sullivan said the company is accelerating development across multiple sites, including Pecos, Muskogee, Hunt, Dalton phase 3, and Auburn, describing an approach designed to bring “RFS timelines within the 12 to 14-month timeframe that customers are actively trying to solve for.”
On Pecos, Brown said Core Scientific has a plan to scale the campus from 300 MW to 1.5 GW, supported by a “multi-pronged expansion strategy” and a mix of grid-connected and behind-the-meter power solutions. Brown said the company has secured an additional 300 MW and is advancing behind-the-meter plans that include “the construction of a linear gas pipeline to the campus.”
Brown said construction is progressing on an initial 431,000-square-foot, 185 MW facility, moving from civil work into foundation phases, with precast walls arriving for vertical construction. He added that long-lead equipment has been secured and that the company is advancing colocation infrastructure, including redundant fiber capacity and a new regional interconnect point in Midland, Texas, linking back to Pecos.
At Muskogee, Oklahoma, Brown said the company announced plans to expand to 1.5 gigawatts of gross power, or about 1 gigawatt of leasable capacity, using both behind-the-meter infrastructure and utility-supplied power, including roughly 440 MW acquired through the Polaris transaction. Brown said development has begun on the first 82.5 MW building, with initial delivery expected in the second half of 2027.
Brown added that other sites—Hunt County, Texas; Dalton, Georgia phase 3; and Auburn, Alabama—are advancing through pre-construction milestones and remain on track for initial delivery timelines.
Commercial discussions and exclusivity update
Sullivan said Core Scientific had previously been engaged in an exclusivity process with a hyperscaler across Pecos and Muskogee, but that exclusivity has expired. He said three hyperscalers “immediately engaged” on those sites afterward, and the company is now in active discussions.
Asked why the exclusivity did not progress, Sullivan said it was “hard to determine the exact reasons,” but noted that Core Scientific chose to bring the sites back to market as other hyperscalers were “knocking at the door.” He said the company’s view on exclusivity going forward is that it may be necessary in some negotiations but should include clear milestones, adding: “We will not keep high value assets off the market longer than necessary.”
In response to questions about the company’s engagement with potential customers, Sullivan said relationships with hyperscalers are not new and that Core Scientific is “in conversations with all of the hyperscalers, chip makers, AI labs, neo clouds.” He said the company is showing the same sites to multiple customer types, while noting that some emerging customer segments may require additional credit support and that the company is working with customers and financing partners on structures that can support “long term financable commitments.”
Costs, capex plans, and mining transition
Nygaard said first-quarter SG&A on a cash basis was “just over $30 million,” and while the company is not providing explicit SG&A guidance, he said that level represents a “reasonable baseline” going forward, with potential for opportunistic investments to support growth.
Nygaard also said Core Scientific increased its target cash gross profit range for the CoreWeave contract to 80% to 85%, up from 75% to 80%, citing improved visibility into the cost structure now that the company is billing a meaningful portion of the contracted megawatts. In the Q&A, management described the change as a “true up” based on experience and greater specificity around staffing and contractors after two years of execution.
On capital spending, Nygaard said Core Scientific expects to deploy roughly $2 billion of total capital expenditures in 2026. He said that includes about $700 million for the Hunt County site acquisition, which closed the day prior to the call, and the Polaris acquisition at Muskogee announced earlier the same day, as well as spending to begin “pre-seeding approximately 1 gigawatt of new billable capacity,” including long-lead equipment procurement and site development and utility support activities.
Management also addressed the company’s Bitcoin mining business. Nygaard said the mining segment is being run to help offset contractual power costs during the transition to high-density colocation, and expects mining to wind down over the year with “a meaningful step down in miners online in the second half.” Sullivan later said that by the end of the year, the company expects to have “only one or potentially two sites operating Bitcoin mining.” Nygaard added that Core Scientific monetized a significant portion of its Bitcoin holdings earlier this year and now retains only a modest amount on the balance sheet.
Separately, Nygaard said the company hired Jorge Rey as chief accounting officer.
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.
