CoreWeave has announced an all-stock acquisition of Core Scientific worth about $9 billion, expected to close in late 2025. This acquisition comes as Core Scientific recovers from its 2022 bankruptcy.
What Does CoreWeave Get from Core Scientific?
After declaring bankruptcy in 2022, Core Scientific pivoted from Bitcoin mining to high-performance computing (HPC) and AI hosting. The deal with CoreWeave is expected to provide additional computing power and reduce Core Scientific's debt to $1.1 billion. In 2024, CoreWeave exercised an option that could increase Core Scientific's revenue by $2 billion over 12 years. As a result, CoreWeave is projected to gain an additional 1.3 GW of power by 2027.
Risks for CoreWeave After the Acquisition
At the time of the deal, CoreWeave would assume Core Scientific's total debt of $1.1 billion. The management noted that the merger could help reduce expenses by terminating duplicative leasing obligations. However, CoreWeave already carries a debt of $17.2 billion and has faced losses of approximately $300 million per quarter since the beginning of 2024.
Growth Prospects for CoreWeave in AI
CoreWeave reported a revenue backlog of $25.9 billion as of Q1 2025, including a strategic partnership with OpenAI. CEO Michael Intrator stated that this acquisition accelerates their strategy to deploy AI at scale. The report for Q1 2025 showed a 420% increase in year-over-year revenue.
The acquisition of Core Scientific by CoreWeave marks a significant move in the high-performance computing and AI sector. Despite existing risks related to debt, the deal opens up new opportunities for the company's growth.
