Woofun AI reports that Core Scientific has executed a decisive strategic transformation, abandoning its procurement relationship with Block and Jack Dorsey to fully commit to a lucrative partnership with AMD.

The financial toll of this contract termination is quantified in the latest quarterly filings, which disclose a $41.9 million loss incurred by Core Scientific. This expense stems directly from a settlement agreement with Block and its subsidiary Proto Global LLC, which formally terminated existing contracts and extinguished all subsequent mining chip delivery obligations. The company absorbed this hit to sever ties with the mining hardware division.

Payment history reveals a structured timeline of capital outflows prior to the breakup. Core Scientific paid $10 million in July 2024, followed by $21.3 million in January 2025. The final payment of $36.6 million was completed in January 2026, marking the end of the financial commitment to the mining hardware initiative.

The driving force behind this pivot is a massive 15-year data center rental agreement with AMD, unrelated to Block. The contract covers 529 megawatts of capacity and is projected to generate $14 billion in contracted revenue, offering a far more stable and profitable return than cryptocurrency mining.

Block’s initial hardware push began with a purchase framework agreement announced in July 2024. The plan involved delivering self-developed 3-nanometer mining chips capable of a 15 EH/s hash rate. Core Scientific was designated as the first customer and remained the only large-scale purchaser listed publicly by Block.

Woofun AI data shows that escalating deposits underscored the depth of Core Scientific’s initial commitment. By January 2025, the company had paid $31.3 million in deposits and prepayments, with an estimated additional $64.8 million still required. In January 2026, after some chips were delivered, Core Scientific paid another $36.6 million before canceling all remaining orders.

Block’s internal strategy shifted significantly in November 2024 with the shutdown of the TBD department, which had overseen Bitcoin mining projects and Web5 identity projects. A shareholder letter stated that funds would be reallocated from the music streaming platform Tidal to the mining business and the Bitcoin self-custody wallet Bitkey, citing strong product-market fit.

Dorsey’s promises during the Q2 2025 earnings call contrasted sharply with subsequent reality. He predicted satisfied customers and a significant market share, and Block unveiled Proto mining machines at Core Scientific’s facility in Dalton, Georgia. Less than a year later, this key client canceled the contract, abandoning the hardware at a loss.

Broader business setbacks have plagued Block, including a 68% stock drop over five years. In 2021, Block spent $237.3 million to acquire Jay-Z’s Tidal, later recognizing a $132.3 million goodwill impairment. In July 2025, Dorsey launched Bitchat, warning of security vulnerabilities. In January 2025, the CFPB imposed a $55 million fine and up to $120 million in penalties for Cash App fraud handling, following an $80 million state fine.

Workforce reductions signal further contraction, with Block planning to cut staff from over 10,000 to less than 6,000 employees by February 2026, resulting in 4,000 layoffs. The company will release its Q2 2026 earnings report after the U.S. stock market closes on August 5, having yet to respond to the Core Scientific contract cancellation.