Iris Energy Secures $3.6 Billion for AI Expansion Despite Quarterly Earnings Miss

2026-02-05 companies

Sydney, Friday, 6 February 2026.
Despite missing revenue estimates, Iris Energy validated its pivot to artificial intelligence by securing $3.6 billion in financing to support its massive infrastructure agreement with Microsoft.

Mixed Financial Results Shake Investor Confidence

In its fiscal second-quarter report released on Thursday, February 5, 2026, Iris Energy (IREN) revealed a divergent financial picture that sent shares tumbling. The company reported quarterly revenue of $184.7 million, a figure that fell significantly short of Wall Street expectations [2][7]. Analysts had projected revenue closer to $229.64 million, marking a substantial miss as the company navigates its capital-intensive transition from pure-play Bitcoin mining to high-performance computing [4]. The bottom line also reflected the costs of this pivot; IREN posted a net loss of $155.4 million for the quarter, translating to a loss of $0.52 per share [2][4]. This performance was notably weaker than the consensus estimate, which had anticipated a loss of only $0.07 per share [4]. Following the news, the stock declined by 17.39%, trading down to $32.87 as markets reacted to the immediate fiscal headwinds [2].

Financing the AI Ambition

While the quarterly figures missed the mark, the company’s strategic execution tells a more optimistic story regarding its long-term infrastructure goals. Coinciding with the earnings release, Iris Energy announced it has secured $3.6 billion in financing specifically allocated for Graphics Processing Units (GPUs) to fulfill its agreement with Microsoft [2]. This funding is a critical component of the company’s expansion, as the Microsoft deal involves a massive deployment of hardware. In addition to the financing, the company received a $1.9 billion prepayment from Microsoft [2]. Together, these funds are expected to cover approximately 94.828% [alert! ‘Calculation based on $5.8B capex figure from Source 1 preview and funding totals from Source 2’] of the capital expenditures required for the GPU deployment, significantly de-risking the project’s execution phase [1][2].

Scaling Infrastructure for 2026

The capital injection directly supports IREN’s aggressive growth targets for the calendar year 2026. The company reiterated its plan to scale its operations to 140,000 GPUs, aiming to achieve an annualized revenue run-rate (ARR) of $3.4 billion by the end of the year [2]. This expansion is not limited to hardware; IREN also announced the addition of a new 1.6-gigawatt (GW) data center campus in Oklahoma [2]. This development pushes the company’s total secured grid-connected power portfolio to over 4.5 GW, providing the necessary energy backbone to support its burgeoning AI cloud services division alongside its legacy operations [2]. Daniel Roberts, Co-Founder and Co-CEO, emphasized that the quarter marked “meaningful progress across capacity expansion,” despite the headline financial miss [2].

Navigating the Transition

The company’s pivot comes at a time when its legacy Bitcoin mining business faces volatility, with cryptocurrency weakness cited as a factor weighing on the stock prior to the earnings release [6]. However, the shift toward AI infrastructure appears to be accelerating. As of January 31, 2026, Iris Energy reported a robust cash position of $2.8 billion, with total funding secured year-to-date exceeding $9.2 billion [2]. This liquidity is essential as the company manages the heavy capital deployment required to service contracts with major clients like Microsoft and newer partners such as Together AI and Fireworks AI [1][2]. While the immediate market reaction reflects disappointment in the quarterly earnings miss, the substantial financing secured for the Microsoft contract suggests that the company’s long-term thesis remains intact [2][4].

Sources

Artificial Intelligence Earnings Preview