IREN raises AI cloud revenue target above $4 billion after securing $2.8 billion in new contracts

IREN Stock Surges on $2.8 Billion AI Cloud Deals

IREN shares jumped as much as 16% on Monday after the company announced $2.8 billion in new multi-year cloud services contracts with leading AI developers and raised its year-end 2026 AI cloud revenue target to over $4 billion1

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. The updated AI Cloud annualized run-rate revenue target marks a significant increase from the previous $3.7 billion forecast, with approximately 85% of this revised target now backed by signed contracts4

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. The announcement signals strong momentum for the former Bitcoin mining company as it pivots to become a major player in AI infrastructure.

Major Clients Drive AI Infrastructure Demand

The new contracts showcase IREN's ability to attract top-tier customers in the AI space. The company's client roster now includes Microsoft, NVIDIA, Perplexity, Figure AI, Together AI, Fluidstack, Fireworks AI, Fal AI, Hume AI, and an unnamed AI developer2

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. These agreements cover both bare metal infrastructure and managed cloud services, reflecting the diverse needs of AI developers and hyperscalers. IREN previously secured a massive $9.7 billion cloud services contract with Microsoft in November to provide access to NVIDIA GB300 GPUs over five years, which included a 20% customer prepayment2

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. In May, the company also announced a five-year AI infrastructure cloud services contract with NVIDIA valued at approximately $3.4 billion2

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Prepayments Reduce Funding Requirements

A critical aspect of the recent deals involves customer prepayments covering approximately 45% of the associated GPU capital expenditures, which significantly reduces IREN's funding requirements for those deployments1

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. This prepayment structure lowers near-term pressure on the company's balance sheet as it funds GPUs, data center buildout, and supporting infrastructure2

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. Customer agreements across IREN's portfolio carry a weighted average duration of about four years, providing long-term revenue visibility2

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. As of June 30, 2026, IREN reported approximately $7.6 billion in cash and cash equivalents, giving the company financial flexibility to execute its expansion plans2

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Aggressive Capacity Expansion Plans

Co-CEO Daniel Roberts revealed that IREN plans to deliver 480 megawatts of AI cloud capacity in 2026, a dramatic increase from about 3 MW a year earlier, with 1.2 gigawatts targeted for 20271

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. The company stated that demand from hyperscalers, enterprises, AI developers, and frontier AI laboratories continues to exceed its existing and planned GPU cloud capacity1

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. IREN is actively working with customers across its 2026 and 2027 expansion program to meet this surging demand4

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. The company operates data centers powered by 100% renewable energy and maintains a secured power pipeline of 5 GW, with expansion plans at Childress, Sweetwater, and other sites2

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From Bitcoin Mining to AI Cloud Services

The update follows Bernstein's April assessment that IREN's AI cloud business would become its primary revenue driver as the company repurposes mining infrastructure for AI computing, part of a broader trend of Bitcoin miners expanding into AI and high-performance computing1

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. IREN stock is the fourth-largest holding in the CoinShares Bitcoin Mining ETF (WGMI) at 10.05% of assets, which was up 9.61% as other miners also saw modest share gains1

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. Analysts maintain a Buy rating on IREN stock with an average price target of $79.11, with Macquarie holding an Outperform rating at $90.00, Freedom Broker upgrading to Buy with a $58.00 target, and Jefferies initiating coverage with a Buy rating at $79.003

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. The company's strategic partnership with NVIDIA includes a five-year right for NVIDIA to purchase up to 30 million ordinary shares at $70 each, potentially resulting in an investment of up to $2.1 billion if conditions are met2

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