TLDR
IREN stock rebounds 15.81% to $20.88 after plunging 16.95% to $18.03 on Thursday.
IREN signs a five-year AI Cloud contract worth about $22 million per megawatt.
Customer prepays 90% of GPU costs as IREN expands its AI Cloud contract base.
IREN’s net debt climbs to $4.43 billion as cash reserves fall to $3.52 billion.
AI Cloud revenue surges 182% to $200 million despite growing funding pressures.
IREN Limited (IREN) fell 16.95% to $18.03 on Thursday despite announcing a major five-year AI Cloud agreement. However, shares subsequently rebounded 15.81% to $20.88, gaining $2.85 in the latest quoted trading update. The company secured substantial customer prepayments, but its rising debt and declining cash position highlighted growing financing demands.
IREN Limited, IREN
IREN Secures Five-Year AI Cloud Contract With 90% GPU Prepayments
IREN announced the agreement on November 5, alongside its fiscal first-quarter 2027 financial results. The five-year contract carries approximately $22 million in annualized revenue per megawatt of information technology capacity. Moreover, the customer will prepay approximately 90% of the capital expenditure associated with graphics processing units.
The agreement strengthens IREN’s strategy of funding AI infrastructure through customer commitments and equipment financing. Additionally, the company secured a short-term contract generating approximately $40 million in revenue per megawatt. IREN also expanded an existing agreement with a leading frontier AI laboratory, extending its commercial relationships.
IREN secured new contracts for older H100 graphics processors at twice their previous pricing. Contracted pricing increased 11% for three-year agreements and 12% for five-year agreements. However, the company withheld customer identities, total contract values, deployment dates, and specific hardware quantities.
IREN Cash Reserves Decline as Net Debt Climbs
Despite securing substantial customer commitments, IREN reported significant changes across its balance sheet. Cash declined from approximately $5.90 billion to $3.52 billion, while net debt increased sharply. The company’s net debt reached approximately $4.43 billion, compared with $216 million previously.
The company continues expanding its AI computing operations, requiring substantial spending on equipment and data center infrastructure. IREN combines customer prepayments, GPU financing, and other funding arrangements to support its expansion. Chief Financial Officer Anthony Lewis explained that the company targets financing covering approximately 90% of related GPU expenditure.
Lewis also outlined the financial benefits of customer prepayments during the company’s earnings discussion. Under one example, a five-year contract generating $20 million per megawatt included a 50% GPU prepayment. That arrangement would allow the company to recover its GPU investment within approximately 18 months.
IREN Reports Strong AI Revenue Growth Despite Funding Pressures
IREN reported $228 million in quarterly revenue, representing a 66% increase from the previous quarter. AI Cloud revenue climbed 182% to $200 million, while Bitcoin mining contributed another $28 million. Additionally, the company reduced its quarterly net loss to $263 million from $684 million, reflecting improved operating performance.
The company’s revenue backlog increased 22% to $20.3 billion, supported by agreements across its AI infrastructure operations. IREN pushed its $4 billion annualized revenue target from December 2026 to January 2027. Customer design changes and supplier schedules caused the adjustment, while management identified February as another possible completion date.
Meanwhile, Co-CEO Daniel Roberts explained that customers with weaker credit profiles often provide larger upfront payments. This relationship adds another consideration when assessing substantial prepayments and their role in financing new infrastructure. Nevertheless, IREN continues expanding its AI Cloud business through long-term contracts, equipment financing, and additional data center development.
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