IREN Lands $9.7B Microsoft Deal, Eyes $3.4B AI Cloud ARR by 2026

IREN has announced a significant leap in its operations with a $9.7 billion multi-year contract with Microsoft, aiming for substantial growth in its AI Cloud offerings. The company is targeting approximately $3.4 billion in Annual Run Rate (ARR) from AI Cloud services by the end of 2026, which includes an expansion to 140,000 GPUs.

Financial Performance Overview

For the first quarter of FY26, ending September 30, 2025, IREN reported record revenues of $240.3 million, marking an impressive 355% increase compared to the same period in FY25. The company’s net income for this quarter reached $384.6 million, significantly rebounding from a net loss in the previous year.

• Q1 FY26 Revenue: $240.3 million
• Net Income: $384.6 million
• Adjusted EBITDA: $91.7 million
• Total EBITDA: $662.7 million (includes unrealized gains)

Strategic Developments

As part of its operational strategy, IREN is increasing its GPU capacity to 140,000 units, positioning itself strongly within the AI Cloud market. The deal with Microsoft is expected to provide a 20% upfront customer prepayment, contributing an estimated $1.9 billion to the company’s target ARR.

Operational Milestones

In addition to expanding GPU capabilities, IREN has set crucial operational milestones:

• Completion of the GPU transition in British Columbia by the end of 2026.
• Energization of the Sweetwater substation 1 (1,400MW) anticipated in April 2026.
• Energization of the Sweetwater substation 2 (600MW) expected by late 2027.

Financial Position

As of October 31, 2025, IREN’s cash and cash equivalents stood at $1.8 billion. The company has secured $1 billion in zero-coupon convertible notes and additional GPU financing to enhance its operational capacity, bringing total GPU financing to $400 million.

This financial structure is intended to solidify IREN’s resources for executing its ambitious AI Cloud expansion plans. With the planned investments and strategies in place, IREN aims to not only meet but exceed its growth targets in the rapidly evolving AI landscape.

Conclusion

IREN’s announcement of a $9.7 billion deal with Microsoft and its aggressive target of achieving $3.4 billion in AI Cloud ARR by 2026 showcases the company’s growth trajectory. As IREN enhances its GPU capacity and strengthens its financial position, stakeholders can look forward to significant advancements in its service offerings.