Catenaa, Thursday, November 13, 2025-IREN’s aggressive AI-cloud expansion is expected to drive long-term revenue growth, but JPMorgan warns the rapid buildout may pressure the company’s balance sheet over the next year.
The bank projects IREN will spend over $9 billion to expand GPU and AI data-center capacity, even after Microsoft’s $9.7 billion prepayment for cloud services. The expansion plan includes adding approximately 120,000 GPUs and bringing 320 megawatts of new capacity online within 13 months. JPMorgan estimates roughly 374 million diluted shares following recent equity issuances and convertible note conversions.
IREN reported fiscal first-quarter revenue of $240.3 million and adjusted EBITDA of $92 million, marking its fifth consecutive quarter of record sales. Executives said the Microsoft deal is expected to add $1.94 billion in annual recurring revenue with project-level margins near 85%. The company aims to reach 140,000 GPUs by the end of 2026, supporting roughly $3.4 billion in annualized run-rate revenue.
Despite a recent pullback, with shares trading below $60 after peaking above $76, IREN stock remains more than double JPMorgan’s long-term $28 target. Analysts raised the December 2026 price target from $24 to $28, citing momentum in AI-cloud adoption and validation from new hyperscale partnerships.
JPMorgan highlighted execution risk tied to rapid scaling, noting funding needs and potential shareholder dilution as the company transitions from bitcoin mining to a large-scale AI-cloud operator. The expansion, while costly, is expected to underpin substantial long-term upside if delivered successfully.
