IREN remains to be principally a Bitcoin miner by income, even because it retires mining {hardware} to make room for AI infrastructure and develop IREN’s AI cloud income.
The corporate’s fiscal 2026 outcomes, filed Aug. 27, present Bitcoin mining generated $578.2 million of IREN’s $707 million in annual income, or about 81.8%. AI Cloud Providers contributed $128.8 million.
That ongoing transition produced a $638.8 million non-cash impairment, primarily tied to decommissioning miners as knowledge middle websites had been transformed for AI workloads. IREN additionally reported a $702.6 million web loss, which was affected by the impairment and different objects. The cost was not a $638.8 million money outflow, nevertheless it put an accounting worth on property retired earlier than the substitute enterprise had totally entered service.
IREN AI cloud income faces a $3 billion working hole
As of Aug. 26, IREN had $1 billion of working annualized run-rate income, or ARR, in opposition to $4 billion of contracted ARR for its 2026 capability. IREN targets the bigger run charge to be operational by Dec. 31.
The corporate calculates ARR from contracted GPU pricing multiplied by a full yr of hours, together with storage and associated providers. It’s an working measure, not GAAP income, and IREN warns that acknowledged income could also be materially decrease. Closing the hole relies on bodily infrastructure being delivered and accepted, in addition to the corporate’s utilization and pricing assumptions.
IREN’s Kind 10-Okay says income typically begins solely after knowledge facilities are constructed and energized, gear is put in and commissioned, efficiency testing is full and prospects settle for the capability. Delays can postpone income whereas financing and working prices proceed, and might set off delay or service credit.
The timeline is staged. Microsoft accepted Horizon 1 in August. Horizons 2 via 4 had been focused for phased supply in calendar This fall 2026, with contractual grace durations extending into the start of calendar Q2 2027.
At June 30, IREN nonetheless had put in Bitcoin mining capability of about 23.2 EH/s throughout roughly 380MW. The corporate aimed to considerably full the transition of that knowledge middle capability towards AI Cloud Providers by year-end.
Delay additionally carries a financing value. IREN raised GPU financing to assist the Microsoft contract via a delayed-draw mortgage priced at one-month SOFR plus 2.25% and senior notes at 5.96%, with tranches topic to circumstances. A separate Mackenzie financing of as much as $2.4 billion carries a 9% fastened charge and matures 30 months after every related staged funding date.
Microsoft and NVIDIA collectively represented a considerable majority of contracted income, in accordance with IREN. New prospects diversify the roster, however acceptance, efficiency and counterparty dangers stay concentrated.
IREN has contracts that would exchange the mining enterprise on a run-rate foundation. The submitting doesn’t present that substitute as accomplished. The subsequent proof is buyer acceptance of the remaining deployments and the GAAP AI income they start to provide.
