IREN reported quarterly results above market expectations, supported by growth in its artificial intelligence cloud business, but delayed its annualized revenue target until 2027.
Revenue growth and a delayed target
According to the IT industry on November 6, IREN’s revenue for the first quarter of fiscal 2027 rose 66% from the preceding quarter to $228 million, approximately 300 billion won. That exceeded the market forecast of $221 million, approximately 299.4 billion won. AI cloud revenue increased roughly threefold over the same period, from $71 million, approximately 96.1 billion won, to $200 million, approximately 270.9 billion won.
IREN moved the point at which it expects to exceed $4 billion in annualized revenue, approximately 5.4192 trillion won, from the end of 2026 to January 2027. The possibility of a further delay until the end of February was also raised, depending on supplier schedules. Annualized revenue is the revenue expected when contracted facilities become operational, expressed on an annual basis.
IREN shares closed regular Nasdaq trading on November 5, local time, at $18.03, down 16.95% from the previous session. They rebounded after results were released following the close and subsequently traded at $20.44, up 13.37% from the regular-session closing price.
Network changes and market concerns
During the earnings conference call, IREN co-CEO Daniel Roberts explained that Microsoft had requested changes to the network design so that it could run its latest AI models at 200 MW of data center facilities. IREN said it had signed all the contracts supporting its annualized revenue target and secured the funding needed to build the related facilities.
AI-related shares had previously fallen together on concerns that data center regulation could tighten following the Democrats’ landslide victory in the U.S. midterm elections. Reports that Microsoft was reviewing its data center business with external AI cloud providers also weighed on investor sentiment.
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IREN said it plans to spend $15 billion on capital expenditure over the remainder of the current fiscal year. It plans to cover $9 billion with cash on hand and committed financing, and raise the remaining $6 billion depending on market conditions.
“Capital markets have become more challenging in recent weeks,” Roberts said. “The focus has shifted from how large contracts are to the ability to execute them, raise financing and generate revenue.”
Original Korean article: ZDNet Korea
English brief by Korea Wind Intelligence, koreawindintel.com
