Core Scientific Upgraded to Buy on $24 Billion AMD AI Data Center Deal

• Freedom Capital Markets upgraded Core Scientific to Buy, citing 530 MW AMD deal that expands contracted revenue to $24 billion.
• The company reported Q2 colocation revenue of $137 million, surging from $10.6 million a year prior as it pivots from mining.
• Market participants weighed a $6 billion capital requirement and a 2028 completion timeline, causing a 3.13% stock dip despite the upgrade .
• The AMD agreement secures 2.5 gigawatts of capacity, representing a structural shift to predictable institutional leases.

Core Scientific (CORZ) has seen a significant shift in analyst sentiment following its second-quarter 2026 earnings and a landmark agreement with Advanced Micro Devices (AMD). Freedom Capital Markets upgraded the stock from Hold to Buy, raising its price target to $33 . The firm highlighted that Core Scientific is ahead of schedule in delivering power capacity for CoreWeave and securing new institutional contracts .

The upgrade reflects a changing investment thesis. Previously maintaining a Hold rating at $30, the analyst now supports the stock at $18, noting a 40% drop from highs and improved fundamentals . Core Scientific now bills for 437 megawatts of power, a metric that exceeds most of its competitors in the sector .

How does the AMD deal transform Core Scientific's revenue model?

The cornerstone of the recent momentum is 15-year agreement with AMD covering an initial 530 megawatts of capacity across five sites. This deal is expected to generate over $14 billion in base revenue, bringing the company's total contracted revenue to $24 billion . The agreement includes three consecutive five-year extension options and secures up to 2.5 gigawatts of potential future capacity .

This partnership marks a definitive break from volatile cryptocurrency mining. AMD is vertically integrating its supply chain to address the primary bottleneck in AI deployments: power and data center real estate . By tying its hardware roadmap to dedicated physical sites, AMD secures guaranteed power access for its AI chips .

The deal also includes an equity mechanism where AMD receives warrants to purchase 30 million shares . These warrants vest based on executed megawatts, aligning AMD's equity participation with physical deployment and de-risking Core Scientific's capital expenditures .

What are the execution risks and regulatory challenges for CORZ?

Despite the bullish analyst commentary, the stock fell 3.13% to $20.09 as investors weighed the substantial capital requirements . The company faces an estimated $6 billion in capital requirements, with the first AMD megawatts not expected until the first half of 2027 . Completion of the full build-out is targeted for 2028, extending the timeline for full realization of the contracted revenue .

Financially, the transition is already evident in the company's results. Total Q2 revenue reached $164.2 million, with colocation revenue surging to $136.7 million. However, the company reported a GAAP loss of $3.32 per share, largely driven by non-cash warrant fair-value adjustments . Self-mining gross margins were negative 56%, generating a $12.2 million segment loss.

Regulatory headwinds also present a near-term challenge. Texas Governor Greg Abbott ordered audit of pending data center grid interconnections, pausing new approvals. This regulatory review delays proposed developments but increases the scarcity value of already-approved power capacity . Core Scientific has higher exposure to the Texas grid compared to some competitors, as its near-term expansion plans depend on local connectivity .

The company continues to reduce its mining footprint by 30% from first-quarter levels . By June 30, self-mining operations were operating at only two sites . The strategic pivot to AI infrastructure hosting underscores a broader industry shift toward high-performance computing and digital infrastructure .