IREN Delays More Than $4 Billion ARR Target Launch to January 2027
Key Facts
IREN postponed the launch date for its more than $4 billion ARR target to January 31, 2027, with the date potentially extending to the end of February, from a previous target of the end of 2026. The company said in results published on November 5 that a design change requested by a customer and supplier timing led it to revise the schedule. It confirmed that the funding needed for this target is fully secured. ARR measures the annualized revenue run rate associated with operating capacity and does not represent revenue earned or recognized under GAAP. The delay puts the focus on how quickly contracts and planned capacity can be converted into operating data centers.
The company recorded total revenue of $228 million in the quarter ended September 30, 2026, up 66% from the previous quarter. AI Cloud revenue was about $200 million, up 182% quarter over quarter. Meanwhile, revenue backlog rose 22% to $20.3 billion as of the end of September. IREN said about two-thirds of this backlog is tied to investment-grade counterparties. Growth in cloud revenue and backlog indicates an expansion in contracted business, while bringing capacity online on the revised schedule remains the execution focus.
IREN's net loss for the quarter was $263 million, compared with a loss of $684 million in the quarter ended June 30, 2026. For the fiscal year ended June 30, 2026, the company recorded revenue of $707 million, versus $501 million in the prior year, but posted a net loss of $702.6 million after a profit of $86.9 million. Annual AI Cloud revenue rose to $128.8 million from $16.4 million, while bitcoin mining revenue was $578.2 million. The company linked part of the annual loss to a non-cash asset impairment of $638.8 million, mainly related to mining equipment taken out of service as sites were converted to support cloud growth. These figures show a shift in the business mix toward cloud computing alongside the continued contribution of mining to annual revenue.
IREN estimated planned remaining capital expenditure for fiscal 2027 at about $15 billion. It expects to cover $9 billion through cash, committed GPU financing and customer prepayments. The remaining $6 billion is funding it aims to raise through GPU financing, customer prepayments, data center financing and other institutional sources, subject to market conditions. The company allocated this plan to future capacity targets and said its more than $4 billion ARR target is fully funded. This arrangement separates funding for the stated operating target from the capital needed for subsequent expansion.
In its fiscal 2026 results, IREN had reported $4 billion of contracted ARR for 2026 capacity, while about $1 billion of it was operational at the time. This highlights the difference between the value of contracts tied to future capacity and the revenue run rate generated by capacity already in operation. The company is converting its sites from bitcoin mining to artificial intelligence services and said mining equipment taken out of service contributed to the asset impairment recorded during the year. The company also delivered and obtained acceptance for Microsoft's Horizon 1 facility, the first of four facilities with capacity of 50 megawatts each under a five-year cloud services contract worth $9.7 billion. IREN aimed to expand total AI Cloud capacity to 480 megawatts in 2026 and 1.2 gigawatts in 2027.
After the quarter ended, IREN expanded an existing contract with a leading AI lab and announced a short-term contract with estimated annualized revenue of $40 million per IT megawatt. It also signed a five-year contract worth about $22 million per IT megawatt annually, with the customer's prepayment covering 90% of the capital expenditure associated with GPUs. On November 6, the company's shares rose 20% amid a rebound in AI stocks, after it reported quarterly results that exceeded analysts' expectations and announced the two new contracts. EL7 data showed the shares closed at $21.64 that day, compared with $18.03 on November 5. The revised ARR launch dates and financing for future capacity plans remain among the next milestones in executing the company's plan.