IREN (IREN) Swaps Bitcoin Rigs For Microsoft’s (MSFT) GPU Contracts

IREN is executing a complete transition from Bitcoin mining to artificial intelligence infrastructure, highlighted by the delivery of the first phase of a liquid-cooled data center to Microsoft (MSFT). The company reported that fourth-quarter AI cloud revenue surged past 100% to $70.5 million, supporting $4 billion in contracted revenue booked against its 2026 capacity, with $1 billion actively generating cash flow. To fund this expansion, IREN secured $6.5 billion in GPU financing over three months, including $3.6 billion in investment-grade debt linked specifically to the Microsoft contract. However, the operational pivot has significantly impacted the balance sheet, generating a fourth-quarter net loss of $684 million due to $450.4 million in noncash impairments from decommissioning mining hardware. Looking ahead, IREN plans a massive $25 billion to $30 billion capital expenditure program for fiscal 2027 to expand its secured 5-gigawatt power pipeline. Market sentiment remains divided as hedge fund ownership climbed to 69 funds, while short interest stands at 27.24% of the float amid execution and lead-time risks.