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Will GPU Expansion & Data Center Growth Boost IREN's Q2 Earnings?
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Key Takeaways
IREN's Q2 should benefit from rapid GPU expansion and rising AI cloud service revenues.
IREN is scaling GPU capacity near 140,000 units with customer pre-contracting, improving revenue visibility.
IREN's Capital-heavy AI cloud and data center growth may pressure results due to funding and dilution risks.
IREN Limited (IREN - Free Report) is scheduled to report its second-quarter fiscal 2026 results on Feb. 5, with investor focus centered on its rapid GPU fleet expansion and accelerating data center buildout. These initiatives, supported by strong customer demand and improving capacity utilization, are expected to enhance revenue visibility and operational scale, positioning the company for stronger earnings performance in the quarter under review.
Click here to know how IREN Limited’s overall fiscal second-quarter results are likely to be.
GPU Expansion Lifts IREN’s AI Cloud Revenue Growth
IREN Limited’s AI Cloud Services revenues are likely to have driven strong performance in the second quarter of fiscal 2026, supported by a clear execution roadmap and strong infrastructure readiness. The company aims to increase its GPU capacity from nearly 23,000 units to about 140,000 GPUs by the end of 2026, utilizing only around 460MW, or roughly 16%, of its nearly 3GW secured power portfolio. Its British Columbia locations, including Prince George, Mackenzie and Canal Flats, are transitioning from ASIC mining to GPU operations and can collectively support over 60,000 GPUs, enabling rapid and capital-efficient scaling. This initiative is expected to generate up to $1 billion in incremental annualized run-rate revenues from the additional 40,000 GPUs deployed at Mackenzie and Canal Flats.
Accelerating pre-contracting activities with customers such as Microsoft, Together AI and Fluidstack is improving revenue transparency and validating demand for the expanding GPU fleet. With record momentum in the fiscal first quarter and the support of a vertically integrated data center platform, IREN is well-positioned to turn its GPU expansion into stronger revenue growth and improved earnings in the to-be-reported quarter. The Zacks Consensus Estimate for AI Cloud Services revenues is pegged at $31.2 million, indicating solid year-over-year growth from $2.7 million in the year-ago quarter.
IREN’s expanding data center platform is likely to support stronger growth in fiscal second-quarter results, driven by rapid construction progress and AI-ready infrastructure. At the Childress campus, Horizons 1–4 are being developed with 200MW of liquid-cooled IT load to enable phased GPU deployments for Microsoft through 2026. Design planning for Horizons 5–10 is also underway, providing a pathway to convert the entire 750MW site to liquid-cooled AI operations. Features such as Tier 3-equivalent maintainability, high-density racks and durable infrastructure position the campus to handle both current and future AI workloads.
In addition, the Sweetwater hub in Texas offers substantial long-term scalability. Sweetwater 1 (1.4GW) is scheduled for energization in April 2026, with Sweetwater 2 planned for late 2027. Management has highlighted increasing customer interest in the site, which is emerging as a large-scale data center market comparable to major global hubs.
Heavy Spending on AI Cloud Poses Risk to IREN
Despite these positives, IREN’s outlook is constrained by its highly capital-intensive expansion strategy. The company is scaling its AI cloud platform to support the Microsoft contract and large GPU deployments, requiring an estimated $5.8 billion in GPU and infrastructure investments. While customer prepayments and secured GPU financing will provide partial funding, the remaining capital must be sourced through cash reserves, operating cash flow, additional debt, equity issuance and convertible notes. This financing mix is expected to increase leverage and dilute shareholders, reducing financial flexibility and weighing on second-quarter fiscal 2026 performance.
IREN’s Zacks Rank & Stocks to Consider
IREN Limited currently carries a Zacks Rank #3 (Hold).
The Zacks Consensus Estimate for Alexander's fourth-quarter 2025 earnings is pegged at $3.02 per share, revised upward by 2 cents over the past 30 days and represents a year-over-year decline of 25.62%. Alexander's shares have gained 29.1% over the past year.
The Zacks Consensus Estimate for Cboe Global's fourth-quarter 2025 earnings is pegged at $2.93 per share, up by 12.7% over the past 30 days and suggests year-over-year growth of 39.52%. Cboe Global’s shares have appreciated 26.4% over the past year.
The Zacks Consensus Estimate for Outfront Media's fourth-quarter 2025 earnings is pegged at 71 cents per share, unchanged over the past 30 days and suggests year-over-year growth of 2.90%. Outfront Media’s shares have rallied 33.3% over the past year.
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Will GPU Expansion & Data Center Growth Boost IREN's Q2 Earnings?
Key Takeaways
IREN Limited (IREN - Free Report) is scheduled to report its second-quarter fiscal 2026 results on Feb. 5, with investor focus centered on its rapid GPU fleet expansion and accelerating data center buildout. These initiatives, supported by strong customer demand and improving capacity utilization, are expected to enhance revenue visibility and operational scale, positioning the company for stronger earnings performance in the quarter under review.
Click here to know how IREN Limited’s overall fiscal second-quarter results are likely to be.
GPU Expansion Lifts IREN’s AI Cloud Revenue Growth
IREN Limited’s AI Cloud Services revenues are likely to have driven strong performance in the second quarter of fiscal 2026, supported by a clear execution roadmap and strong infrastructure readiness. The company aims to increase its GPU capacity from nearly 23,000 units to about 140,000 GPUs by the end of 2026, utilizing only around 460MW, or roughly 16%, of its nearly 3GW secured power portfolio. Its British Columbia locations, including Prince George, Mackenzie and Canal Flats, are transitioning from ASIC mining to GPU operations and can collectively support over 60,000 GPUs, enabling rapid and capital-efficient scaling. This initiative is expected to generate up to $1 billion in incremental annualized run-rate revenues from the additional 40,000 GPUs deployed at Mackenzie and Canal Flats.
Accelerating pre-contracting activities with customers such as Microsoft, Together AI and Fluidstack is improving revenue transparency and validating demand for the expanding GPU fleet. With record momentum in the fiscal first quarter and the support of a vertically integrated data center platform, IREN is well-positioned to turn its GPU expansion into stronger revenue growth and improved earnings in the to-be-reported quarter. The Zacks Consensus Estimate for AI Cloud Services revenues is pegged at $31.2 million, indicating solid year-over-year growth from $2.7 million in the year-ago quarter.
IREN Limited Price and EPS Surprise
IREN Limited price-eps-surprise | IREN Limited Quote
IREN’s Data Center Growth Lifts Prospects
IREN’s expanding data center platform is likely to support stronger growth in fiscal second-quarter results, driven by rapid construction progress and AI-ready infrastructure. At the Childress campus, Horizons 1–4 are being developed with 200MW of liquid-cooled IT load to enable phased GPU deployments for Microsoft through 2026. Design planning for Horizons 5–10 is also underway, providing a pathway to convert the entire 750MW site to liquid-cooled AI operations. Features such as Tier 3-equivalent maintainability, high-density racks and durable infrastructure position the campus to handle both current and future AI workloads.
In addition, the Sweetwater hub in Texas offers substantial long-term scalability. Sweetwater 1 (1.4GW) is scheduled for energization in April 2026, with Sweetwater 2 planned for late 2027. Management has highlighted increasing customer interest in the site, which is emerging as a large-scale data center market comparable to major global hubs.
Heavy Spending on AI Cloud Poses Risk to IREN
Despite these positives, IREN’s outlook is constrained by its highly capital-intensive expansion strategy. The company is scaling its AI cloud platform to support the Microsoft contract and large GPU deployments, requiring an estimated $5.8 billion in GPU and infrastructure investments. While customer prepayments and secured GPU financing will provide partial funding, the remaining capital must be sourced through cash reserves, operating cash flow, additional debt, equity issuance and convertible notes. This financing mix is expected to increase leverage and dilute shareholders, reducing financial flexibility and weighing on second-quarter fiscal 2026 performance.
IREN’s Zacks Rank & Stocks to Consider
IREN Limited currently carries a Zacks Rank #3 (Hold).
Alexander's (ALX - Free Report) , Cboe Global (CBOE - Free Report) and Outfront Media Inc. (OUT - Free Report) are some better-ranked stocks that investors can consider in the broader Zacks Finance sector. ALX, CBOE and OUT sport a Zacks Rank #1 (Strong Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Alexander's fourth-quarter 2025 earnings is pegged at $3.02 per share, revised upward by 2 cents over the past 30 days and represents a year-over-year decline of 25.62%. Alexander's shares have gained 29.1% over the past year.
The Zacks Consensus Estimate for Cboe Global's fourth-quarter 2025 earnings is pegged at $2.93 per share, up by 12.7% over the past 30 days and suggests year-over-year growth of 39.52%. Cboe Global’s shares have appreciated 26.4% over the past year.
The Zacks Consensus Estimate for Outfront Media's fourth-quarter 2025 earnings is pegged at 71 cents per share, unchanged over the past 30 days and suggests year-over-year growth of 2.90%. Outfront Media’s shares have rallied 33.3% over the past year.