Three major bitcoin mining companies—IREN, Core Scientific, and TeraWulf—significantly reduced their mining operations during the third quarter while substantially increasing revenue from artificial intelligence and high-performance computing services.
The three companies generated approximately $478 million in AI-cloud and HPC colocation revenue in Q3, double the $239 million recorded in Q2. During the same period, their combined realized bitcoin hashrate fell approximately 49%, from 32.8 exahashes per second to 16.8 EH/s, based on calculations derived from disclosed bitcoin production figures.
Individual Company Changes
IREN recorded the most dramatic shift. Its realized hashrate fell from approximately 21.6 EH/s to 8.9 EH/s, while AI-cloud revenue increased from $70.5 million to $200 million. The company's installed mining capacity contracted from 23.2 EH/s to 7.9 EH/s, indicating that equipment was physically removed alongside the production decline.
Core Scientific reduced its estimated realized hashrate from 7.0 EH/s to 3.8 EH/s. Colocation revenue increased nearly 58% to $215.4 million, representing approximately 92% of total quarterly revenue. The company ended September billing customers for 485 megawatts of capacity, up from 395 megawatts three months earlier, and expects to completely exit the mining business by year's end.
TeraWulf showed relative stability in mining hashrate during Q3, declining slightly from approximately 4.2 EH/s to 4.1 EH/s following earlier reductions. HPC revenue nearly doubled to $63 million, accounting for approximately 83% of total revenue.
Bitdeer Captures Market Share
As larger competitors withdrew from mining, Bitdeer expanded significantly. Its bitcoin production increased from 2,694 BTC in Q2 to 3,855 BTC in Q3, equivalent to approximately 9.2% of the quarter's total network mining rewards. Its realized hashrate rose from approximately 63 EH/s to 85 EH/s.
In September alone, Bitdeer produced 1,355 BTC, accounting for more than 9.7% of network rewards. The company is also developing an AI business, with AI-cloud revenue increasing to $20.4 million from $14 million in Q2.
Wider Industry Picture
Among 11 public mining companies that disclosed Q3 earnings, realized hashrate declined only about 2% sequentially to approximately 246 EH/s. However, excluding Bitdeer, the remaining companies contracted almost 15%, from approximately 189 EH/s to 161 EH/s. This divergence reflects a widening competitive divide as larger operators withdraw capacity while one expanding competitor offsets much of their retreat.
Hardware Inventory
The shift to AI services has left significant mining equipment inventory. IREN and Keel together carried approximately $80.5 million of bitcoin mining equipment held for sale at the end of September, after write-downs. Core Scientific reported another $29.7 million of sale inventory combining mining, electrical, and HPC equipment.
Some equipment has already changed hands. Cipher sold 6,840 Avalon A15Pro rigs back to Canaan earlier in the year as it shifted toward AI services. TeraWulf reported selling or disposing of 5,010 miners during Q3.
