Core Scientific and TeraWulf reported nearly $1.9 billion of combined Q3 profit while shifting from Bitcoin mining toward data-center hosting for AI customers. Pretax non-cash gains of $1.76 billion lifted the total, and the two companies posted opposite operating results.
Core Scientific and TeraWulf reported nearly $1.9 billion of combined third-quarter profit as they moved from Bitcoin mining toward data-center hosting for AI customers. However, their earnings included $1.76 billion of pretax non-cash gains from revaluing financial instruments.
Warrant revaluations drive the gains
Core's $1,178 million consolidated net income and TeraWulf's $710 million add up to approximately $1.89 billion. Of Core's gain, $964 million came from legacy Tranche 1 and Tranche 2 warrants, $69 million from the liability portion of an AMD warrant and $1 million from contingent value rights.
TeraWulf's $728 million gain came from revaluing Google warrants issued in exchange for credit support covering certain Fluidstack lease obligations. Remeasurement raises reported earnings through a non-cash accounting entry.
Operating results split
Operating results diverged. Core earned $72 million in operating income, and that figure included a $19 million digital-asset fair-value gain. TeraWulf recorded an $88 million operating loss.
Hosting now supplies most of both companies' revenue. Core's colocation revenue reached $215 million out of $233 million in total sales, while TeraWulf generated $63 million of high-performance computing (HPC) lease revenue, approximately 83% of its $76 million total.
Construction funding shows up in cash flows
The construction bill shows up in the nine-month cash flow figures. Core generated $296 million of operating cash while spending $1,495 million on property, plant and equipment, and net financing cash inflow was $3,200 million.
TeraWulf, by contrast, used $179 million of operating cash and spent $2,231 million on plant and equipment purchases and deposits. It received $1,010 million of net financing cash, including approximately $1,200 million from common-stock issuance.
Core says conversions for hosting customer CoreWeave are largely funded by that customer, while development under its AMD and other cloud-customer arrangements will require additional external financing. Core has reached positive operating income, whereas TeraWulf still reports an operating loss.
Source: CryptoSlate
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