Core Scientific Incurred $84M in Q4 Interest Expenses

Core Scientific (NASDAQ: CORZ) resumed large interest payments in Q4 as it neared close to bankruptcy reorg, its annual report shows.

According to its annual report filed on Wednesday, the company incurred $86 million in net interest expenses in 2023. $84 million of that was paid in the last quarter as it reached final stages of the bankruptcy reorganization plan.

The bitcoin mining and colocation giant emerged from bankruptcy protection in January, a little over a year after it filed for Chapter 11 in late 2022 and suspended interest payouts.

It reported a total revenue of $142 million for Q4, 2023 and 79% of that came from the proprietary mining of 3,041 BTC worth $112 million over the same period.

The cash-based cost of revenue for Core’s mining segment was estimated to be $44.7 million, excluding share-based costs and depreciation expenses. That implies a cost of production of $14.7k or a direct fleet hashcost of $33/PH/s.

However, an adjusted interest expense of $21.5 million for Q4 would translate to another $16/PH/s in financial hashcost. With other corporate overhead, Core’s total adjusted hashcost in Q4 was estimated to be $56.6/PH/s, which is about half of bitcoin’s hashprice of $120/PH/s at the moment.

Meanwhile bitcoin’s halving event is expected to take place on April 20, which is set to reduce the hashprice by about 50% immediately afterward.

During the bankruptcy reorganization, Core Scientific did not make any large miner purchase orders until September for 4.08 EH/s of Bitmain’s Antminer S19j XP in an effort to upgrade its fleet for lower hashcost.

According to its annual report, it made another purchase order in October of 2.52 EH/s of Bitmain’s Antminer S21 model for $50.4 million. That implied a unit cost of $20/TH/s.

It is not clear if the order was a full cash transaction or a mix of cash and equity payment. Other competitors like CleanSpark, Cipher Mining (NASDAQ: CIFR) and Iris Energy bought the S21 miners around October for $14/TH/s.