Core Scientific Inc

Core Scientific, Inc. (NASDAQ: CORZ) provides digital infrastructure for high-density colocation services and digital asset mining. The Company operates dedicated, purpose-built facilities for digital asset mining and is a provider of digital infrastructure, software solutions and services to its third-party customers. Its Digital Asset Self-Mining segment consists of digital asset mining for its own account. 

Recent Business and Financial Updates

• Financial Performance Overview: Core Scientific, Inc. (NASDAQ: CORZ) reported a first-quarter 2025 net income of USD580.7 million, a significant increase from USD210.7 million in Q1 2024, primarily driven by a USD621.5 million non-cash mark-to-market adjustment on warrant liabilities and contingent value rights due to a decline in share price. However, total revenue decreased to USD79.5 million from USD179.3 million in Q1 2024, reflecting a 75% reduction in Bitcoin mined due to the Bitcoin halving and the company’s strategic shift to high-density colocation services. Adjusted EBITDA was negative at USD (6.1) million, compared to USD88.0 million in Q1 2024, impacted by lower revenue and increased operating expenses. The company maintained a robust liquidity position with USD778.6 million in cash, cash equivalents, and digital assets as of March 31, 2025, supporting its growth initiatives.
• Operational Transition to Colocation Services: Core Scientific is rapidly transitioning from digital asset mining to high-density colocation services, with plans to deliver 250MW of billable capacity to CoreWeave by the end of 2025, including 8MW by May 2025 and an additional 40MW by the end of Q2 2025. This shift is expected to generate annualized colocation revenue of approximately USD360 million by 2026. Colocation revenue in Q1 2025 reached USD8.6 million, with a non-GAAP gross margin of 8% after excluding pass-through power costs. The company’s focus on high-performance data infrastructure positions it to meet the accelerating demand for AI-driven computing, marking a strategic pivot to capitalize on emerging market opportunities.
• Digital Asset Mining Performance: Digital asset self-mining revenue in Q1 2025 was USD67.2 million, down from USD150.0 million in Q1 2024, with a gross profit of USD6.0 million at a 9% margin, compared to USD68.4 million at a 46% margin in the prior year, primarily due to a 75% decrease in Bitcoin mined. Hosted mining revenue fell to USD3.8 million from USD29.4 million, with a gross profit of USD1.7 million at a 46% margin. The decline in mining output reflects the impact of the Bitcoin halving and the operational shift to collocation, though lower power costs, down 33% due to reduced rates and usage, partially mitigated the impact. Core Scientific continues to optimize its mining operations to maintain efficiency amidst market challenges.
• Strategic Investments and Cost Dynamics: Selling, general, and administrative expenses rose to USD40.1 million in Q1 2025 from USD16.9 million in Q1 2024, driven by a USD13.9 million increase in stock-based compensation, USD7.2 million in non-capitalizable colocation site startup costs, and USD2.5 million in personnel expenses to support the colocation transition. Operating loss widened to USD42.6 million from an operating income of USD55.2 million in Q1 2024, reflecting the revenue decline and higher expenses. Despite these challenges, a USD16.3 million reduction in interest expense and increased proceeds from money market funds supported net income growth. Core Scientific’s investments in colocation infrastructure underscore its commitment to long-term growth in high-performance computing.
• Growth Outlook and Market Positioning: Core Scientific is strategically positioned at the forefront of the data center infrastructure evolution, driven by the increasing demand for AI and high-performance computing. The company’s ability to deliver 250MW of colocation capacity by year-end 2025, combined with its strong liquidity of USD778.6 million, provides financial flexibility to pursue organic and inorganic growth opportunities. The transition to colocation services, expected to yield significant revenue by 2026, aligns with market trends favoring scalable, high-density data centers. Despite short-term financial pressures from the Bitcoin halving and increased operational costs, Core Scientific’s focus on execution and infrastructure development positions it to capitalize on the transformative shift in modern computing demands.

Technical Observation (on the daily chart):

The 14-day Relative Strength Index (RSI) is currently at 60.95, corrected from over-bought zone, with the expectations of consolidation or some upward momentum in case the price breaks above important resistance of USD 13.00. In addition, the current price is above both the 50-day Simple Moving Averages (SMAs) and 200-day SMA, which may work as medium to long term support levels.

As per the above-mentioned price action, recent key business and financial updates, momentum in the stock over the last month, and technical indicators analysis, a ‘WATCH’ rating has been given Core Scientific, Inc. (NASDAQ: CORZ) at the closing price of USD12.30, as of June 25, 2025. 

Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario. 

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Related Risk: This report may be looked at from a high-risk perspective and a recommendation is provided for a short duration. This report is solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc. 

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is June 25, 2025. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level that the stock is expected to reach as per the relative valuation method and or technical analysis taking into consideration both short-term and long-term scenarios.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the New York Stock Exchange (NYSE), NASDAQ Capital Markets (NASDAQ), and or REFINITIV. Typically, all sources (NYSE, NASDAQ, or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.