Core Scientific plans to cease Bitcoin mining by the end of 2026

American company Core Scientific (NASDAQ: CORZ) plans to completely cease Bitcoin mining and hosting third-party mining equipment by the end of 2026. This was announced by CFO Jim Nygard on November 5 during an investor conference following the third quarter results. Starting in 2027, the company intends to focus on providing data center infrastructure for artificial intelligence and high-performance computing.

"We expect to complete the winding down of operations in the fourth quarter and enter 2027 as a company specializing exclusively in high-density colocation services," Nygard stated.

Financial results show that the transition to the new business model has already significantly changed the revenue structure of Core Scientific.

In the third quarter of 2026, the company's revenue amounted to $232.9 million compared to $81.1 million a year earlier. Meanwhile, self-mining of Bitcoin brought in $12.3 million compared to $57.4 million in the same quarter of 2025.

Revenues from hosting third-party mining equipment decreased from $8.7 million to $5.2 million. The total revenue from the mining segment was about $17.4 million, or 7.5% of the total figure.

The main source of income became colocation services for high-performance computing. Revenue from this segment reached $215.4 million compared to $15 million a year earlier, providing about 92.5% of the company's quarterly income.

By the end of September, the number of operational miners at Core Scientific had decreased by almost 50% compared to the end of 2025.

Why Core Scientific is Changing Its Business Model

The transition to servicing computing infrastructure began in 2024 when Core Scientific signed its first agreements with CoreWeave, a provider of cloud computing power for AI.

In June 2024, the companies announced long-term contracts for hosting high-performance equipment using approximately 200 MW of infrastructure. Initially, Core Scientific considered this direction as a complement to the mining business, but subsequently gradually reduced Bitcoin mining.

One of the factors was the worsening mining economy and the decline in the market value of specialized equipment.

In the first quarter of 2026, Core Scientific recognized an impairment of fixed assets amounting to $266.5 million. The company explained this by the decline in Bitcoin prices, the drop in computing power profitability, and the depreciation of mining equipment on the secondary market.

In the second quarter, Core Scientific also terminated a contract with Block and Proto for the supply of cryptocurrency mining equipment. The accounting loss associated with the termination of the agreement amounted to $41.9 million.

Amid the reduction in mining, the company continues to introduce capacity for data center clients. As of September 30, the paid capacity reached 485 MW. Compared to the second quarter, colocation revenue increased by almost 60%.

However, the development of the new business requires significant investments in the construction and modernization of infrastructure. As of the third quarter, Core Scientific's capital expenditures, including land acquisitions and development rights, amounted to about $985 million.

The company expects to complete the winding down of mining operations in the fourth quarter of 2026. If the plan is implemented, from the beginning of 2027, its results will be primarily formed by providing infrastructure for high-performance computing.