Welcome to Mining Wednesday, where Blockspace covers the intersection of bitcoin mining, energy, and AI.

Today, we cover CoreWeave’s S-1 filing. It’s about a 5 minute read.

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Silicon-enjoyers are about to get another ticker to bid: CRWV. Ethereum miner-turned-cloud computing giant CoreWeave filed its S-1 to kick off a long-anticipated public listing. The company first stepped into the limelight in Bitcoin mining circles after inking an unprecedented 12-year contract with Core Scientific, now worth $10.2 billion. If the SEC approves the S-1 filing, CoreWeave will have a clear path to an initial public offering on the Nasdaq.

Below, we’ll break down the S-1’s notes on revenue, megawatts & GPUs, capital stack and some final thoughts on its relationship with Core Scientific.

Per the prospectus, CoreWeave reported $1.92 billion in revenue in 2024, versus $228.9 million and $15.8 million in 2023 and 2022. Adjusted EBITDA for the same periods were $1.22 billion, $103.9 million, and -$9.9 million.

A whopping $1.2 billion (62%) of CoreWeave’s 2024 revenue came from Microsoft, up from $81 million (35%) in 2023. CoreWeave lists a number of tech and financial stalwarts as its clients, including Meta, IBM, Nvidia, and Jane Street. You can almost hear CORZ bagholders licking their lips as visions of Microsoft-funded Lambos zoom around in their heads.

We’re writing about CoreWeave here. But like the opener waiting for the main act to invite them onstage for the encore, Core Scientific is lurking in the wings.

No disrespect, Mr. Sullivan. In fact, that’s perhaps not a fair analogy, because CoreWeave’s prospectus made clear something if it wasn’t already: that it and Core Scientific’s near-term fates are intertwined.

Core Scientific is furnishing nearly half of CoreWeave’s planned capacity

As of their latest agreement, CoreWeave has contracted 590 MW of capacity from Core Scientific, all of which will come from six former or under-construction Bitcoin mines that Core Scientific is retrofitting for AI workloads. In its Q4 2024 presentation, Core Scientific projects that it will complete the first 250 MW by the end of 2025 and the remaining 340 MW by the end of 2026.

In its prospectus, CoreWeave said it has 360 MW online currently and 1.3 GW of total contracted capacity as of December 2024, so Core Scientific’s share is 45% of the whole pie and 63% of CoreWeave’s current expansion plans.

As it stands currently, CoreWeave has operations in 32 data centers spread across 15 states and four countries.

Show me the money, honey

Now for the question no one likes to answer: How is CoreWeave going to finance its grand expansion plans?

To date, CoreWeave says that it has raised “over $14.5 billion in debt and equity across 12 financings.” The lion's share of this is what CoreWeave calls “GPU-infrastructure-backed lending.”

If this conjures thoughts of the ASIC-backed financing that blew up spectacularly in 2022, you’re not alone—but you’re also not right if you think they are completely comparable. This is Big Boy Financing™ from the likes of Blackstone, meaning the terms are more favorable than those that miners signed with their ASIC-backed loans from 2020 to 2022. Plus, GPUs are ostensibly more liquid, subject to less price volatility, and are generally more useful and multi-purpose than Bitcoin miners.

All of that said, the interest rates on these loans are still higher than we would expect from a blue-chip hyperscaler like Oracle, Amazon, or Google, indicating that CoreWeave still has some perceptions of risk to shrug off as it grows.

CoreWeave raised a total of $8.19 billion, of which $7.02 billion came from debt financing, and it spent $8.7 billion on purchases for property, plant, and equipment (PPE) for its expansions. As of the end of 2024, the company has $1.36 billion in cash and $4.41 billion in untapped financing from its existing debt facilities, for a total liquidity of $5.77 billion.

There’s no clear indication of how much of 2024’s financing was spent on the Core Scientific retrofit. Under the terms of its contract, CoreWeave is paying for almost all of this brownfield in return for a reduced hosting fee from Core Scientific in the first year or so of their 12-year contract.

Of course, we don’t know how much this construction will cost. But it won’t be cheap. Taking estimates on per MW CAPEX spend for both GPUs and Core Scientific’s retrofit from an October 2024 J.P. Morgan report, CoreWeave could spend between $8.75 and $9.25 billion for the 250 MW slated for 2025 and between $11.9 and $12.58 billion for the 340 MW to be delivered in 2026.

Assuming this ballpark estimate is more or less accurate, CoreWeave may have already fronted some or most of the spend for the 2025 capacity with its $8.7 billion in PPE spending in 2024. It would be charitable to assume that all of this went to Core Scientific, given that the company also has another 450 MW reportedly in its pipeline, but even if we do assume this, CoreWeave will likely need more than $10 billion for the 2026 expansion.

Its cash position and existing credit won’t cover this, but the IPO will help a lot, and CoreWeave should also have access to more (and cheaper) financing options once it goes public.

The times they are a-changin’

Not so long ago, after its 2017 founding, CoreWeave was a crypto miner, just like Core Scientific. Now, it’s raking in nearly $2 billion in annual revenue and has some of the largest tech companies funding its payroll.

Given this history, it shares more than a first name with Core Scientific, which is trying its best to metamorphose from a Bitcoin mining company to a traditional data center operator.

As it stands, both companies are depending on each other to shed their crypto cocoons and begin a new phase. Sure, CoreWeave is more diversified with multiple hosting providers, but Core Scientific will still account for nearly half of its total capacity should the retrofit be successful. Core Scientific, then, is arguably more dependent on CoreWeave, given that the company is its sole AI client currently—something the company is clearly working to address. CEO Adam Sullivan stated during its Q4 earnings call that CoreWeave should represent less than 50% of Core Scientific’s AI revenue by 2028.

Until then, Core Scientific’s fortunes are linked to CoreWeave’s own, starting with their 12-year, $10.2 billion contract.

Not bad for a company that’s barely a year removed from bankruptcy.

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