Core Scientific Reports Steep Revenue Decline in Q1 2025 Amid Strategic Pivot, But Net Income Surges
Core Scientific, a prominent Bitcoin mining and data center infrastructure provider, reported a sharp revenue decline in its Q1 2025 earnings while simultaneously achieving a substantial increase in net income — a contrast that underscores the company’s ongoing strategic transformation.
The firm’s total revenue fell 55.7% year-over-year, dropping to $79.5 million from $179.3 million in Q1 2024. The revenue shortfall was primarily attributed to a significant drop in self-mined Bitcoin following the April 2024 halving event and a pivot toward colocation services. Self-mining remained the dominant revenue stream, contributing $67.2 million (84.5%), followed by colocation at $8.6 million (10.8%) and hosted mining at $3.8 million (4.7%).
Despite the revenue plunge, Core Scientific reported a net income of $580.7 million, marking a 175.6% increase compared to $210.7 million in the same quarter last year. This unexpected gain stemmed largely from a $621.5 million non-cash mark-to-market adjustment on financial instruments like warrants, triggered by the company’s fluctuating stock price.
Additionally, a $16.3 million reduction in interest expenses helped improve profitability, though these gains were partially offset by $111.4 million in restructuring costs tied to the company’s emergence from bankruptcy and a $99.8 million decline in overall revenue.
Operationally, however, the company still faced challenges. Gross profit from self-mining dropped significantly to $6.0 million from $68.4 million a year earlier, shrinking profit margins from 46% to 9%. The volume of mined Bitcoin declined by 75%, a result of the halving event and reduced mining activity due to the strategic shift toward colocation. Adjusted EBITDA turned negative at $6.1 million, compared to $88 million in Q1 2024, while the company posted an operating loss of $42.6 million, reversing a previous operating income of $55.2 million.
Yet, Core Scientific closed the quarter with $778.6 million in liquidity, positioning it well for future expansion. A key component of this forward-looking strategy involves its new partnership with CoreWeave, a high-performance computing (HPC) firm. The partnership aims to deliver 250 megawatts of billable capacity by the end of 2025, targeting $360 million in annualized colocation revenue by 2026.
“This quarter marks an inflection point for Core Scientific,” said CEO Adam Sullivan. “We’ve gone from vision to execution, delivering infrastructure at scale and positioning ourselves at the center of one of the most important shifts in modern computing.”
Meanwhile, the company's stock (CORZ) has experienced turbulence. Shares are down 36.65% year-to-date, closing at $8.90 with a modest 1.0% daily decline. However, pre-market trading showed a rebound, with shares rising 5.51% to $9.39.
