Bitcoin miner IREN still gets 82% of revenue from BTC after clearing room for Microsoft AI cloud
IREN is still principally a Bitcoin miner by revenue, even because it retires mining {hardware} to make room for AI infrastructure and develop IREN’s AI cloud revenue.
The firm’s fiscal 2026 results, filed Aug. 27, present Bitcoin mining generated $578.2 million of IREN’s $707 million in annual revenue, or about 81.8%. AI Cloud Services contributed $128.8 million.
That ongoing transition produced a $638.8 million non-cash impairment, primarily tied to decommissioning miners as information heart websites have been transformed for AI workloads. IREN additionally reported a $702.6 million internet loss, which was affected by the impairment and different objects. The cost was not a $638.8 million money outflow, however it put an accounting worth on belongings retired earlier than the substitute enterprise had totally entered service.
IREN AI cloud revenue faces a $3 billion working hole
As of Aug. 26, IREN had $1 billion of working annualized run-rate revenue, or ARR, towards $4 billion of contracted ARR for its 2026 capability. IREN targets the bigger run price to be operational by Dec. 31.
The firm calculates ARR from contracted GPU pricing multiplied by a full 12 months of hours, together with storage and associated providers. It is an working measure, not GAAP revenue, and IREN warns that acknowledged revenue 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 Form 10-K says revenue usually begins solely after information facilities are constructed and energized, tools is put in and commissioned, efficiency testing is full and clients settle for the capability. Delays can postpone revenue whereas financing and working prices proceed, and may set off delay or service credit.
The timeline is staged. Microsoft accepted Horizon 1 in August. Horizons 2 by means of 4 have 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 still had put in Bitcoin mining capability of about 23.2 EH/s throughout roughly 380MW. The firm aimed to considerably full the transition of that information heart capability towards AI Cloud Services by year-end.
Delay additionally carries a financing value. IREN raised GPU financing to help the Microsoft contract by means of a delayed-draw mortgage priced at one-month SOFR plus 2.25% and senior notes at 5.96%, with tranches topic to situations. A separate Mackenzie financing of as much as $2.4 billion carries a 9% mounted price and matures 30 months after every related staged funding date.
Microsoft and NVIDIA collectively represented a considerable majority of contracted revenue, based on IREN. New clients diversify the roster, however acceptance, efficiency and counterparty dangers stay concentrated.
IREN has contracts that would change 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 revenue they start to supply.
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