IREN Limited IREN is continuing its transition from Bitcoin mining toward AI cloud infrastructure as demand for GPU capacity remains strong. During the third quarter of fiscal 2026, IREN’s AI cloud services revenues increased 94.2% on a sequential basis to $33.6 million. Management attributed the growth to be driven by rising GPU deployments and increasing customer demand for AI infrastructure. The company believes AI cloud represents a larger long-term opportunity than Bitcoin mining.
Bitcoin mining revenues declined 33.6% sequentially in the third quarter to $111.2 million. Management attributed the decline to lower Bitcoin prices and the ongoing removal of mining hardware ahead of GPU installations. The company is slowly exiting its Bitcoin mining business and is converting several of its existing Bitcoin mining facilities in Texas and British Columbia into AI cloud infrastructure. This bodes well for IREN’s prospects since retrofitting existing air-cooled mining infrastructure is cheaper and faster than constructing new liquid-cooled AI data centers from the ground up.
IREN’s AI cloud business is expanding rapidly. IREN exited the third quarter with $3.1 billion in annual recurring revenues under contract and maintained its target of reaching $3.7 billion ARR by the end of calendar 2026. Further, IREN is targeting 480 megawatts of AI cloud capacity and 150,000 GPUs by the end of 2026. The above-mentioned targets seem achievable as all of IREN’s operational AI cloud capacity is fully contracted, and the company continues to see demand for near-term GPU infrastructure exceed available supply.
Another positive is IREN’s recent NVIDIA partnership, where the company signed a $3.4 billion, five-year AI cloud contract with NVIDIA during the third quarter, which is expected to support future growth in AI cloud revenues. As more GPU capacity comes online, AI cloud revenues are expected to become a larger part of IREN’s overall business and help the company offset the weakness arising due to the exit from its Bitcoin mining business.
IREN Stock Faces Stiff Competition
IREN faces intense competition from Applied Digital APLD and TeraWulf WULF in the AI infrastructure space.
In January 2026, Applied Digital announced that it had started construction on Delta Forge 1, a large AI data center campus in a southern U.S. state. Delta Forge 1 is designed to support up to 430 megawatts (MW) of total utility power in its initial phase. This can support up to 300 MW of critical IT load. The goal is to turn available power into usable, high-density AI capacity for large customers.
