IREN Price Target Cut to $100 Despite $1.94B Microsoft GPU Deal
Analysts cut IREN's price target from $125 to $100, citing equity issuances and a planned wind-down of crypto mining operations. The company contracted 77,000 of its 150,000 GPUs to Microsoft for about $1.94 billion in annual revenue and secured $3.6 billion in sub-6% financing alongside a $5.8 billion Nvidia GB300 purchase deal.
1. Price Target Revision and Mining Wind-Down
Analysts trimmed IREN’s price target from $125 to $100, highlighting equity issuances and a planned wind-down of its bitcoin mining operations while preserving its focus on AI-driven cloud services.
2. Microsoft GPU Contract
IREN has contracted 77,000 of its 150,000 GPUs to Microsoft under a five-year agreement expected to generate roughly $1.94 billion in annual revenue, with the remaining capacity marketed to on-demand cloud customers via $400 million in signed contracts as of February.
3. Financing and Infrastructure Funding
To support the GPU buildout, IREN entered a $5.8 billion purchase agreement for Nvidia GB300 processors and secured $3.6 billion in sub-6% GPU-backed financing; combined with Microsoft prepayments, these cover about 95% of required capital.
4. Growth Outlook and Asset Valuation
Analysts project AI cloud revenues rising to $2.6 billion in 2027 and $6 billion by 2030 with adjusted EBITDA margins near 82%, value 3.6 GW of undeveloped capacity at $3 million per megawatt (approximately $10.8 billion), and expect mining revenue to fall to zero by fiscal 2030.