Why IREN (IREN) Is Down 33.5% After Pivoting From Bitcoin Mining To Microsoft-Funded AI Cloud Expansion

In the past week, IREN reported Q2 FY26 results showing a shift away from Bitcoin mining toward AI cloud infrastructure, underpinned by its multi-year US$9.70 billion Microsoft contract, US$3.60 billion in GPU financing commitments, and plans to deploy 140,000 GPUs supported by more than 4.50 gigawatts of secured power capacity.
An interesting element is that Microsoft has already provided US$1.90 billion in customer prepayments, meaning a major AI hyperscaler is effectively funding a large portion of IREN’s build-out while the company exits its legacy mining-focused model.
Next, we’ll examine how this Microsoft-backed AI cloud expansion reshapes IREN’s investment narrative amid its move away from Bitcoin mining.

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What Is IREN's Investment Narrative?

To own IREN today, you have to believe its pivot from Bitcoin mining to AI cloud will justify the scale of its recent commitments. The Q2 FY26 update crystallizes that story: the US$9.70 billion Microsoft contract, US$3.60 billion in GPU financing at under 6%, and 140,000 planned GPUs now sit alongside more than 4.50 gigawatts of secured power, effectively recasting IREN as a hyperscale compute utility rather than a crypto miner. In the short term, the biggest catalysts look execution‑heavy: meeting Microsoft deployment milestones, ramping AI cloud revenue from a still-small base, and proving that the recent equity and convertible raises translate into durable returns rather than just dilution. The earnings miss and sharp share-price pullback suggest the market is already stress‑testing those execution and balance sheet risks, not dismissing them.

But while Microsoft’s prepayments help fund growth, they also concentrate IREN’s customer and contract risk in one place. Upon reviewing our latest valuation report, IREN's share price might be too pessimistic.

Exploring Other Perspectives

Twenty three fair value estimates from the Simply Wall St Community span roughly US$23 to US$136 per share, reflecting sharply different expectations. Against that backdrop, IREN’s Microsoft funded AI rollout, high recent volatility and execution risks give you several contrasting scenarios to weigh, so it makes sense to compare multiple community views before deciding how this story might fit into your portfolio.

Explore 23 other fair value estimates on IREN - why the stock might be worth over 3x more than the current price!