Shares of Bitcoin mining firm Core Scientific (CORZ) fell 18% on March 6, 2025, due to reports that Microsoft reduced its commitment to CoreWeave, Core Scientific’s key partner.
According to Financial Times, CoreWeave has had difficulty meeting deadlines and is facing material shortages that hamper its ability to support artificial intelligence (AI) model scaling.
CoreWeave, which specializes in cloud computing and AI infrastructure, revealed during its March 3 IPO filing that Microsoft is its largest client.
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Microsoft’s Role In CoreWeave’s Revenue Shrinks Amid Contract Uncertainty
In 2023, Microsoft represented 35% of CoreWeave’s revenue, climbing to 62% in 2024. While there are reports of Microsoft decreasing its commitments, CoreWeave has refuted any claims of contract cancellations.
In a bid to diversify its revenue streams ahead of the upcoming Bitcoin halving, Core Scientific entered a $100 million deal with CoreWeave in March 2024, agreeing to lease a Tier 3 data center in Austin, Texas, equipped for up to 16 megawatts of capacity for AI workloads.
Previously on the verge of bankruptcy, Core Scientific has rebounded to become one of the foremost publicly traded Bitcoin miners. Arkham Intelligence indicates that the company currently holds 755.6 BTC, valued at roughly $66.7 million, with Bitcoin reserves rising steadily since December 2024.
The dip in Core Scientific’s stock aligns with a broader downturn in Bitcoin mining stocks on March 6. Shares of Cipher Mining (CIFR) fell by nearly 9%, while CleanSpark (CLSK) and Bitfarms (BITF) each saw a 5% drop.
Core Scientific, CoreWeave & Microsoft
Cantor disassociates concerns regarding the CoreWeave/Microsoft relationship and its impact on Core Scientific’s stock.
Cantor statement:
“We perceive today’s selloff as a buying opportunity and maintain our overweight rating.” — Richard (@Richard73628254) March 6, 2025
Market sentiment remains shaky, as CNN’s Fear and Greed Index indicates a score of 17, signifying “extreme fear” among investors. The Nasdaq Composite, a tech stock benchmark, fell 2.6%, mirroring broad worries over macroeconomic conditions.
Investors await potential policy changes as the Trump administration sets to host its initial White House Crypto Summit on March 7. The event will feature prominent industry figures, including MicroStrategy’s Michael Saylor, Coinbase’s Brian Armstrong, and Ripple’s Brad Garlinghouse.
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Public Bitcoin Miners Adopt Treasury Strategy
In 2024, Bitcoin miners adjusted to heightened competition and market volatility by adopting new strategies, notably enhancing their Bitcoin treasuries.
According to a January 7, 2025 report from NiceHash and Digital Mining Solutions, numerous public mining companies mirrored MicroStrategy’s approach by bolstering their BTC holdings rather than offloading their mined coins.
Entities like MARA Holdings, Riot Platforms, and Hut 8 went so far as to acquire additional Bitcoin using borrowed funds, indicating a firm commitment to this treasury strategy. Furthermore, miners in 2024 began diversifying into high-performance computing (HPC) and AI sectors as a significant trend.
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Key Takeaways
- Core Scientific’s stock dropped 18% after Azure reduced its commitment to CoreWeave.
- CoreWeave countered claims of contract cancellations, but its dependence on Microsoft for revenue raises concerns.
- Bitcoin miners are increasing BTC holdings and diversifying into AI and HPC.
