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IREN Expands AI Cloud Platform: Can It Sustain the Momentum?
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Key Takeaways
IREN signed $2.8B in AI cloud contracts with leading AI developers across infrastructure and managed services.
IREN raised its 2026 AI Cloud ARR target above $4B, with about 85% already under contract.
Recent customer prepayments cover about 45% of related GPU capital spending, reducing upfront funding needs.
IREN Limited (IREN - Free Report) continues to strengthen its AI cloud business, signing $2.8 billion in new multi-year contracts with leading AI developers, underscoring robust demand for its infrastructure and cloud services. The agreements, covering both bare-metal infrastructure and managed cloud offerings, include customers such as Microsoft, NVIDIA, Perplexity, Figure AI, Together AI, Fluidstack, Fireworks AI, Fal AI, Hume AI and another undisclosed AI developer.
Supported by this demand, IREN raised its year-end 2026 AI Cloud annualized run-rate revenue (ARR) target to more than $4 billion, up from $3.7 billion. About 85% of the revised target is already under contract, enhancing revenue visibility. Recent customer agreements also include prepayments covering roughly 45% of related GPU capital expenditure, helping reduce the company's upfront funding needs. To support future growth, IREN plans to expand AI Cloud capacity to 480 MW by the end of 2026 and 1.2 GW in 2027, up from roughly 3 MW a year ago.
The company also recently completed the acquisition of Spain-based Nostrum Group, marking its entry into Europe. The deal adds approximately 490 MW of secured, grid-connected power, an additional development pipeline and a team of more than 50 specialists, strengthening IREN's ability to meet growing AI infrastructure demand across the region.
IREN's growing customer base, expanding capacity and European expansion reinforce its ambition to become a leading global AI cloud infrastructure provider. While execution remains key, the combination of long-term contracts, customer-backed investments and strategic expansion positions the company to benefit from the accelerating adoption of AI computing.
How Are IREN’s Competitors Faring?
CoreWeave (CRWV - Free Report) operates a GPU-focused AI cloud. CRWV surpassed 1 GW of active power, secured more than 3.5 GW of contracted power and targets more than 8 GW by 2030. CRWV’s revenue backlog is nearly $100 billion.
Applied Digital (APLD - Free Report) develops and leases AI data-center campuses. APLD’s five-campus portfolio includes 1.4 GW of contracted IT load and about 2.15 GW of grid-connected power. APLD has approximately $36 billion of contracted base-term lease revenues.
IREN’s Price Performance, Valuation and Estimates
Shares of IREN have fallen 16.9% over the past three months, underperforming the broader industry and the S&P 500 Composite.
Image Source: Zacks Investment Research
In terms of forward 12-month Price/Sales (P/S), IREN is currently trading at 4.38X, which is at a premium to the industry average of 2.8X.
Image Source: Zacks Investment Research
IREN’s estimate revisions do not reflect an optimistic view. The Zacks Consensus Estimate for fiscal 2026 EPS has been revised downward significantly over the past two months. The consensus estimate for 2026 calls for a significant dip year over year.
View the Zacks #1 Rank List
Image: Bigstock
IREN Expands AI Cloud Platform: Can It Sustain the Momentum?
Key Takeaways
IREN Limited (IREN - Free Report) continues to strengthen its AI cloud business, signing $2.8 billion in new multi-year contracts with leading AI developers, underscoring robust demand for its infrastructure and cloud services. The agreements, covering both bare-metal infrastructure and managed cloud offerings, include customers such as Microsoft, NVIDIA, Perplexity, Figure AI, Together AI, Fluidstack, Fireworks AI, Fal AI, Hume AI and another undisclosed AI developer.
Supported by this demand, IREN raised its year-end 2026 AI Cloud annualized run-rate revenue (ARR) target to more than $4 billion, up from $3.7 billion. About 85% of the revised target is already under contract, enhancing revenue visibility. Recent customer agreements also include prepayments covering roughly 45% of related GPU capital expenditure, helping reduce the company's upfront funding needs. To support future growth, IREN plans to expand AI Cloud capacity to 480 MW by the end of 2026 and 1.2 GW in 2027, up from roughly 3 MW a year ago.
The company also recently completed the acquisition of Spain-based Nostrum Group, marking its entry into Europe. The deal adds approximately 490 MW of secured, grid-connected power, an additional development pipeline and a team of more than 50 specialists, strengthening IREN's ability to meet growing AI infrastructure demand across the region.
IREN's growing customer base, expanding capacity and European expansion reinforce its ambition to become a leading global AI cloud infrastructure provider. While execution remains key, the combination of long-term contracts, customer-backed investments and strategic expansion positions the company to benefit from the accelerating adoption of AI computing.
How Are IREN’s Competitors Faring?
CoreWeave (CRWV - Free Report) operates a GPU-focused AI cloud. CRWV surpassed 1 GW of active power, secured more than 3.5 GW of contracted power and targets more than 8 GW by 2030. CRWV’s revenue backlog is nearly $100 billion.
Applied Digital (APLD - Free Report) develops and leases AI data-center campuses. APLD’s five-campus portfolio includes 1.4 GW of contracted IT load and about 2.15 GW of grid-connected power. APLD has approximately $36 billion of contracted base-term lease revenues.
IREN’s Price Performance, Valuation and Estimates
Shares of IREN have fallen 16.9% over the past three months, underperforming the broader industry and the S&P 500 Composite.
Image Source: Zacks Investment Research
In terms of forward 12-month Price/Sales (P/S), IREN is currently trading at 4.38X, which is at a premium to the industry average of 2.8X.
Image Source: Zacks Investment Research
IREN’s estimate revisions do not reflect an optimistic view. The Zacks Consensus Estimate for fiscal 2026 EPS has been revised downward significantly over the past two months. The consensus estimate for 2026 calls for a significant dip year over year.
Image Source: Zacks Investment Research
Currently, IREN carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.