IREN NASDAQ: IREN said it ended fiscal 2026 with $4 billion in contracted annualized recurring revenue, or ARR, for its 2026 capacity, including $1 billion that was operating following Microsoft’s acceptance of the Horizon 1 deployment.
Co-Founder and Co-CEO Daniel Roberts said the company’s AI cloud strategy is centered on owning the full infrastructure stack, including land, power, data centers, compute equipment and software services. He said AI demand has intensified while physical infrastructure remains difficult and time-consuming to develop.
“Signing deals is not the bottleneck in this market,” Roberts said. “Bringing GPUs online is.”
The company said its 2026 capacity is largely sold out and that it is in late-stage discussions with prospective customers for a significant portion of 2027 capacity, while discussions for 2028 are also underway. IREN disclosed new multicloud contracts with Cohere, Prometheus, Perplexity, Figure AI, Fal.ai and Higgsfield AI, as well as a separate multiyear agreement with an unnamed frontier AI lab.
Roberts said existing customers Together AI and Fireworks AI had renewed and expanded their relationships with IREN. The company is seeking to broaden its customer base across hyperscalers, enterprises, AI developers and frontier labs, while also adding managed-services capabilities through Mirantis.
Capacity Build-Out and Microsoft Deployment
IREN said Horizon 1, the first of four 50-megawatt liquid-cooled deployments at its Childress, Texas, site, was delivered to Microsoft during the month. The deployment achieved NVIDIA Exemplar Cloud status on GB200 NVL72 systems, according to Roberts.
Horizon 2 was progressing toward commissioning, while Horizons 3 and 4 were in late construction. The company is targeting delivery of all three remaining phases during the December quarter.
The company is targeting about 300 megawatts of IT load delivered in 2026 and another 500 megawatts in 2027, which it said would bring gross platform capacity to about 1.2 gigawatts in 2027. IREN is developing capacity across Texas, British Columbia, Oklahoma, South Australia and Spain.
At its British Columbia sites, IREN said GPUs are being installed at Mackenzie, Prince George’s air-cooled fleet is fully commissioned and liquid-cooling installation is underway. The company also decided to convert the Canal Flats site to liquid cooling for GB300 systems.
For 2027, Sweetwater 1 is under construction, while civil work has begun for Horizons 5 and 6 at Childress. IREN said it is also progressing another 250 megawatts of air-cooled conversion. Its longer-term pipeline includes Sweetwater 2 and Kiowa in the U.S., Bundey in South Australia and Badajoz in Spain. The Badajoz site is expected to provide roughly 300 megawatts and is the largest and nearest-term development site within the recently acquired Nostrum portfolio in Spain.
Pricing, Services and Financing
IREN said three-year contract pricing has risen about 125% since November, while five-year pricing has increased about 70%. Recent three-year contracts have been priced above $20 million per megawatt of IT load, and active discussions are at roughly $25 million per megawatt, Roberts said. He added that the contracts generally cover three to five years and are not spot-capacity arrangements.
The company said recent customer prepayments have funded 45% to 55% of GPU capital expenditures. Roberts said IREN is prioritizing customer diversification, contract economics, prepayments and expansion opportunities rather than holding capacity for spot-market pricing.
Chief Commercial Officer Kent Draper said Mirantis expands IREN’s ability to serve customers that want orchestration, enterprise support, monitoring and deployment capabilities in addition to bare-metal compute. He said the service layer could enable offerings such as reserved managed-services clusters and on-demand compute. IREN also said Mirantis was named an inaugural NVIDIA-certified hypervisor.
On financing, CFO Anthony Lewis said the company secured approximately $19 billion in funding during the past 12 months, including nearly $16 billion from customer prepayments, GPU financing and convertible notes, along with roughly $3 billion of equity.
- $3.6 billion of investment-grade GPU financing for the Microsoft contract at a weighted average rate of about 6%.
- $2.8 billion of equipment financing for non-investment-grade deployments, including $2.4 billion at a 9% fixed rate for Mackenzie.
- About $14 billion of existing cash, committed GPU financing and prepayments, including $7.6 billion of cash as of June 30.
Lewis said IREN expects fiscal 2027 capital expenditures of approximately $25 billion to $30 billion. The estimate includes spending for contracted 2026 deployments, air-cooled capacity planned for calendar 2027, liquid-cooled data center capacity at Childress and Sweetwater 1, and earlier-stage investment for 2028 and beyond.
The company expects to seek roughly $8 billion of additional GPU financing and prepayments, with remaining funding needs expected to come from data-center financing, operating cash flow and corporate sources. Lewis noted that IREN’s data-center portfolio, including Horizons 1 through 4, remains unencumbered.
Quarterly Results and Outlook
For the June quarter, IREN reported revenue of $137.2 million, including $70.5 million of AI Cloud revenue. Total revenue declined $7.6 million from the preceding quarter as the company decommissioned mining hardware ahead of GPU installations, partly offset by AI Cloud growth.
Cost of revenue fell $6.6 million, primarily because of lower electricity usage associated with reduced mining activity. IREN reported a net loss of $684 million, driven largely by $450.4 million of non-cash impairments, mostly related to decommissioned mining hardware, and a $102.1 million decline in the fair value of mining hardware held for sale.
The company expects mining operations to be effectively decommissioned by the end of December 2026. It also expects first-quarter cash selling, general and administrative expense to rise by approximately $40 million to $50 million sequentially as it invests in personnel, sales and marketing, research and development, site development and cloud operations.
IREN said it exited the fourth quarter with about $500 million of ARR, reached $1 billion following Horizon 1’s acceptance, and expects more than $4 billion of ARR by the end of the December quarter. Because much of the December-quarter capacity is expected to come online late in the period, the company said the associated revenue effect is expected to be seen predominantly in the March quarter.
About IREN (NASDAQ:IREN)
IREN Limited, formerly known as Iris Energy Limited, owns and operates bitcoin mining data centers. The company was incorporated in 2018 and is headquartered in Sydney, Australia.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.
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