Core Scientific, Inc./tx Q1 FY2022 earnings call

Key Points - Current market conditions: The industry is in a volatile phase, but Core Scientific remains focused on long-term opportunity. - First quarter results: Self-mined 3,202 Bitcoins in Q1, 1,121 in April, operated 16.2 exahash at quarter end, and held over 10,000 self-mine Bitcoins. - Financials: Revenue increased 255% year-over-year to $192.5 million, but net loss was $466.2 million driven by non-cash adjustments and stock-based compensation. - Operational highlights: Expanded hash rate, hosting revenue grew 162% YOY, and continued to invest in infrastructure despite market challenges. - Externalities: Addressed global uncertainties like Europe conflict, inflation, and COVID resurgence, but remains well-positioned. - ESG: Collaborating with industry partners to educate on positive impacts of Bitcoin mining on energy grids and job creation.

In the first quarter, Core Scientific generated revenue of $192.5 million. Digital asset mining revenue was $133 million, representing 69% of total revenue. Hosting revenue was $33.2 million, accounting for 17% of total revenue. Equipment sales totaled $26.3 million, making up 14% of revenue. Adjusted EBITDA for the quarter was $93 million, a significant increase from the prior year.

Guidance - Expect to finish 2022 operating 30 to 32 exahash. - Have clear visibility for 100% of 2022 operating objectives of 1 gigawatt. - Comfortable with internal funding to approximately 1 gigawatt and expect a roughly even split of hosting versus self-mining mix for the year.

Risks - Supply chain inefficiencies and tight credit markets. - Impact of global events (e.g., Europe conflict, inflation, interest rate hikes) on Bitcoin price and investor perceptions, affecting cost of capital and availability.

Q: Chris Brendler asked about growth projections and conservatism, with Mike Levitt stating there's added conservatism due to market challenges but remains funded to 1 gig and 30 exahash range.

A: Mike Levitt responded that there's conservatism, demand for colocation is strong, and they're positioned to take advantage of opportunities.

Q: Chris Brendler asked about cost per coin, with Mike Levitt stating they're still profitable in self-mining and hosting despite Bitcoin price sell-off.

A: Mike Levitt said they're profitable per coin in self-mining and hosting.

Q: Lucas Pipes asked about equipment orders and approach to growth, with Mike Levitt stating they haven't placed new miner orders this year, have $130 million left for miners, and are opportunistic with infrastructure.

A: Mike Levitt explained they're conservative, have visibility into infrastructure, and will pursue opportunities if they meet standards.

Q: Tyler DiMatteo asked about immersion cooling in future infrastructure build-outs, with Mike Levitt stating they'll run some rigs in immersion over the next 6-12 months for better ROI.

A: Mike Levitt said they're studying immersion cooling for improved return on investment and will implement it in the coming months.