CoreWeave just paid $9 billion to buy Core Scientific, eliminating $10 billion in future lease payments. The AI company decided it was cheaper to buy its landlord than keep paying rent. Markets weren't impressed with the math.
💡 TL;DR - The 30 Seconds Version
👉 CoreWeave pays $9 billion in stock to acquire Core Scientific, eliminating $10 billion in future lease payments over 12 years.
📊 The deal gives CoreWeave ownership of 1.3 gigawatts of data center power capacity across ten US states.
🏭 Core Scientific shareholders get 0.1235 CoreWeave shares each, owning less than 10% of the combined company when the deal closes in Q4 2025.
💸 CoreWeave's stock dropped 6% while Core Scientific fell 24% as investors questioned whether the AI company overpaid.
⚡ Both companies pivoted from cryptocurrency mining to AI infrastructure as demand for computing power exploded.
🚀 The acquisition reflects the broader AI infrastructure arms race, with companies paying premiums for data centers that can handle high-performance workloads.
CoreWeave just solved a $10 billion problem. The AI infrastructure company agreed to buy Core Scientific for $9 billion in stock, ending a rental relationship that was bleeding cash.
The deal gives CoreWeave ownership of 1.3 gigawatts of data center capacity across the US. More importantly, it wipes out $10 billion in future lease payments CoreWeave owed Core Scientific over the next 12 years. That's some expensive rent.
CoreWeave went public in March and watched its stock price triple. Core Scientific emerged from bankruptcy last year after Bitcoin crashed and crypto miners went bust. Both companies pivoted from mining digital coins to powering AI workloads. The marriage makes sense, even if the market disagrees.
This isn't CoreWeave's first attempt. The company tried to buy Core Scientific last year for about $1 billion. Core Scientific rejected the offer as too low and said it preferred their existing partnership.
Apparently, $9 billion changed their minds.
Under the new deal, Core Scientific shareholders get 0.1235 shares of CoreWeave for each share they own. The exchange values Core Scientific stock at $20.40 per share, a 66% premium over where it traded before deal rumors surfaced.
The market's reaction was swift and brutal. Core Scientific shares dropped as much as 24% on Monday. CoreWeave fell 6%. Investors seem skeptical about paying nine times more than the rejected offer from last year.
Both companies started in cryptocurrency mining. Core Scientific built massive data centers filled with powerful computers that solved mathematical puzzles to mint Bitcoin. When crypto prices collapsed in 2022, Core Scientific filed for bankruptcy.
The company's founder, Darin Feinstein, was a former nightclub owner who jumped into crypto mining in 2017. He stepped down in 2023 after the bankruptcy filing. Core Scientific emerged from Chapter 11 protection in January 2024 as Bitcoin prices recovered.
CoreWeave took a different path. The company realized the same graphics processing units used for crypto mining worked perfectly for AI training. As demand for AI computing exploded, CoreWeave shifted its business model. The timing proved prescient.
The acquisition is really about power. Not political power, but electrical power. Training large AI models requires enormous amounts of electricity to run thousands of graphics processors simultaneously.
CoreWeave rents cutting-edge chips from Nvidia and leases them to tech companies for AI work. But the company needed places to put all that hardware. Core Scientific's data centers provided the solution, along with access to cheap electricity.
The deal gives CoreWeave control over critical infrastructure instead of relying on lease agreements. CoreWeave expects to save $500 million annually by 2027 through operational improvements and eliminated lease costs.
Core Scientific operates facilities across ten states, including Texas, North Carolina, and Kentucky. The locations were chosen for access to cheap power, often near natural gas plants or renewable energy sources.
Investors questioned whether CoreWeave overpaid. Cantor analysts called the price "too low" from Core Scientific's perspective but noted the acquisition multiple seemed underwhelming.
Core Scientific's stock price peaked at around $18.50 in November 2024. The agreed takeover price of $20.40 represents only a 10% premium over that high. For a company in the hot AI infrastructure space, some expected a bigger premium.
CoreWeave's stock has been volatile since its March IPO. The company initially planned a larger offering but scaled back due to market conditions. Concerns about the company's debt load and lease obligations weighed on the debut.
The acquisition could address some of those worries. Owning infrastructure reduces financial complexity compared to long-term lease agreements. CoreWeave also gains access to different financing options for future expansion.
Combining two companies with different cultures won't be simple. Core Scientific's workforce focused on cryptocurrency mining operations. CoreWeave's team specializes in AI infrastructure and cloud services.
CoreWeave plans to "repurpose or divest" Core Scientific's remaining crypto mining business over time. CEO Michael Intrator told investors the company isn't looking to expand into cryptocurrencies.
The deal requires regulatory approval and Core Scientific shareholder votes. CoreWeave expects to close the transaction in the fourth quarter of 2025.
Upon completion, Core Scientific shareholders will own less than 10% of the combined company. That's a small slice for former owners of a business that commanded a $9 billion price tag.
The acquisition reflects broader competition in AI infrastructure. Cloud providers are racing to build data centers at unprecedented scale to meet demand from AI companies.
Oracle and OpenAI recently struck a deal for 4.5 gigawatts of data center capacity. That's enough power for millions of homes. The AI boom is driving massive infrastructure investment across the industry.
CoreWeave competes with Amazon Web Services, Microsoft Azure, and Google Cloud. The company's focus on specialized AI workloads differentiates it from general-purpose cloud providers.
Data center real estate has become increasingly valuable as AI demand surges. Companies are paying premiums for facilities with adequate power and cooling capacity to handle high-performance computing workloads.
Why this matters:
• CoreWeave just proved the oldest rule in real estate: if you can afford to buy, stop paying rent to someone else
• The crypto mining industry's pivot to AI infrastructure shows how quickly entire business models can shift when new technology creates massive demand
Q: How much has CoreWeave's stock risen since going public?
A: CoreWeave's stock has surged nearly 300% since its March 2025 IPO. The company initially scaled back its offering due to market concerns about debt and lease obligations, but AI infrastructure demand drove the massive rally.
Q: What does 1.3 gigawatts of data center power actually mean?
A: One gigawatt can power about 750,000 homes. Most individual US data centers hold less than one gigawatt. CoreWeave's 1.3 gigawatts from Core Scientific represents massive computing capacity for AI training and deployment.
Q: Why did Core Scientific go bankrupt in 2022?
A: Bitcoin's price collapse crushed Core Scientific's crypto mining business. The company filed Chapter 11 bankruptcy in 2022 when cryptocurrency crashed and mining became unprofitable. It emerged in January 2024 as Bitcoin prices recovered.
Q: How does this deal compare to other AI infrastructure acquisitions?
A: The $9 billion price tag is substantial but not unprecedented. Oracle and OpenAI recently agreed to a 4.5 gigawatt capacity deal. The AI infrastructure arms race is driving massive investments across the industry.
Q: What happens to Core Scientific's remaining crypto mining operations?
A: CoreWeave plans to "repurpose or divest" the crypto mining business over the medium term. CEO Michael Intrator said the company isn't looking to expand into cryptocurrencies and will focus on AI workloads.
Q: How much of the combined company will Core Scientific shareholders own?
A: Less than 10%. Core Scientific shareholders get 0.1235 CoreWeave shares for each share they own, giving them a small slice of the combined company despite the $9 billion acquisition price.
Q: When will the deal actually close?
A: Fourth quarter 2025, assuming regulatory approval and Core Scientific shareholder votes pass. The companies need standard merger approvals plus any AI infrastructure-specific regulatory reviews that may be required.
Q: How exactly does CoreWeave make money?
A: CoreWeave buys cutting-edge graphics processors from Nvidia and rents them to tech companies for AI training and deployment. It's essentially a specialized cloud provider focused on high-performance computing workloads rather than general business applications.
Marcus Schuler
Marcus Schuler
Marcus Schuler
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