CoreWeave, the AI Hyperscaler™, has finalized an agreement to acquire Core Scientific, a leading data center infrastructure provider, in an all-stock transaction. The deal is valued at approximately $9 billion, with Core Scientific stockholders receiving 0.1235 newly issued shares of CoreWeave Class A common stock for each share of Core Scientific common stock. As of July 3, 2025, the agreed-upon exchange ratio implies a value of $20.40 per Core Scientific share, representing a 66% premium to Core Scientific's unaffected share price on June 25. The acquisition is expected to close in the fourth quarter of 2025, subject to customary closing conditions, including regulatory approval and approval by Core Scientific stockholders. Upon completion, Core Scientific stockholders are expected to own less than 10% of the combined company.
Strategic Rationale
The acquisition is a strategic move by CoreWeave to verticalize its data center footprint, future-proof revenue growth, and enhance profitability. CoreWeave expects to generate $500 million in annual cost savings by late 2027 through streamlined operational focus. The deal will also eliminate more than $10 billion in cumulative future lease payments over the next 12 years. Furthermore, the acquisition opens access to more favorable infrastructure financing strategies, reducing CoreWeave's overall cost of capital.
Michael Intrator, CoreWeave's CEO, Chairman of the Board, and co-founder, stated that the acquisition accelerates the company's strategy to deploy AI and HPC workloads at scale. He added that verticalizing the ownership of Core Scientific's high-performance data center infrastructure enables CoreWeave to significantly enhance operating efficiency and de-risk future expansion, solidifying the company's growth trajectory.
Benefits for CoreWeave
Core Scientific's Perspective
Adam Sullivan, Core Scientific's CEO, highlighted the combined company's potential to accelerate artificial intelligence (AI) infrastructure availability. Core Scientific's infrastructure and expertise in data center operations will complement CoreWeave's focus on providing high-performance computing infrastructure for AI and HPC workloads.
Market Reaction
Stock prices of both companies reacted negatively to the news. Core Scientific shares dropped 15% in pre-market trade on Monday. CoreWeave fell 4.4 percent in pre-market trading, while Core Scientific dropped 14 percent. Investors appear concerned about the high acquisition price and the integration of two different corporate cultures.
CoreWeave's Business Model
CoreWeave leverages a usage-based rental model for its GPU cloud services, charging customers based on compute usage. The company focuses on delivering scalable and reliable GPU-accelerated solutions to enterprise clients in sectors such as AI, VFX, and high-performance computing. Key revenue drivers include long-term enterprise contracts, premium pricing with high gross margins, and strategic partnerships with major technology providers like Nvidia. CoreWeave's revenue model relies on long-term, fixed-price contracts with large enterprise customers, ensuring predictable, recurring revenue.
Core Scientific's Background
Core Scientific, formerly a significant player in Bitcoin mining, has been transitioning towards high-density colocation services. The company filed for bankruptcy in December 2022 and has since been working to restructure its business. Core Scientific holds 977 BTC on its balance sheet. While CoreWeave originated from crypto mining, the acquisition does not necessarily indicate a return to the sector. CoreWeave may repurpose Core Scientific's assets toward HPC usage or potentially divest the cryptocurrency mining operations.
Conclusion
The acquisition of Core Scientific by CoreWeave is a significant move in the rapidly expanding AI infrastructure market. CoreWeave will significantly expand its data center capacity and operational efficiency. The deal is expected to close in the fourth quarter of 2025 and is subject to regulatory and shareholder approvals.
