IREN grows AI cloud revenue but delays its contracted capacity target

What did IREN report?

IREN said revenue from its AI cloud business rose 182% from the prior quarter to $200 million. AI cloud means renting out computing power for artificial intelligence work from the company's own data centers.

Why it matters: The results covered the first quarter of IREN's fiscal 2027 and came out after Thursday's close. Total revenue also grew from the prior quarter, the company said. Gross margin in AI cloud, the share of revenue left after direct costs, held level with the prior quarter.

Co-CEO Daniel Roberts said the company's Horizon 1 site went into service for Microsoft during the quarter.

What was delayed, and why?

The setback sits in IREN's contracted annualized revenue target. That is the yearly revenue its signed contracts would bring in once the capacity is running.

Roberts said the target is fully contracted and funded, but now aims for January instead of year-end. He said a design change a customer requested, plus supplier timing, caused the shift. He added that it may extend to the end of February.

How did the stock trade?

IREN shares tumbled 17.0% in Thursday's regular session, before the results, closing at $18.03 from $21.71. That cut its market value by $1.5 billion.

The whole market was falling. The S&P 500 tumbled 4.4% and the Nasdaq-100 fell 6.4%.

After the report, IREN rose 10.5% to $19.93 in after-hours trading. The stock still sits 76.4% below its 52-week high of $76.41.

For broad funds the stock is small. IREN accounts for 0.01% of the value of the 500 largest U.S. companies, so its drop took $1 from $100,000 spread across them by size.

What comes next?

What’s next: The open question is timing. Roberts named January as the target and the end of February as the outer edge he allowed for.

Whether the capacity starts on that schedule may show how quickly Big Tech's AI contracts turn into running data centers and booked revenue.