SYDNEY, August 29, 2026, 14:00 (EDT). IREN shares dropped 12.5% after the company’s $30 billion capital expenditure raised concerns in light of its $4 billion annual AI revenue rate.
- Shares of IREN ended Friday at $35.45, falling 12.53%.
- AI cloud revenue for the quarter increased 110%, reaching $70.5 million.
- Capital expenditure for fiscal 2027 is projected between $25 billion and $30 billion.
- IREN reports it has secured contracts for $4 billion in annualized AI revenue.
Shares of IREN Limited dropped 12.53% as its shift to AI drove solid sales gains but led to softer cash flow performance. The slide wiped out about $2.0 billion in market capitalization.
The main dispute for investors is between scale and financing. IREN is aiming for as much as $30 billion in capital expenditure by fiscal 2027, while its current market value is about $14 billion.
IREN Limited (NASDAQ: IREN) finished Friday at $35.45. Trading volume reached approximately 89.3 million shares, placing it on Yahoo’s Most Active list.
AI cloud revenue for the quarter climbed to $70.5 million, marking a 110% sequential increase. It surpassed Bitcoin mining revenue for the first time.
Quarterly revenue declined 5% to $137.2 million. Adjusted EBITDA was down 68%, reaching $19.2 million.
The quarter posted a net loss of $684.0 million. The result included a $450.4 million impairment, mainly due to decommissioning mining hardware in the course of the transition fiscal 2026 results.
| Investor measure | Latest reading | Read-through |
|---|---|---|
| Friday close | $35.45; −12.53% | Market cap dropped by about $2.0 billion |
| Q4 AI cloud revenue | $70.5 million; +110% QoQ | AI now ahead of Bitcoin mining |
| Q4 adjusted EBITDA | $19.2 million; −68% QoQ | Spending hit profitability |
| FY27 capital-spending guide | $25 billion–$30 billion | Equals around 1.8–2.1x current market cap |
| Contracted AI run-rate revenue | $4 billion | Delivery relies on deployment pace |
AI cloud revenue rose nearly eightfold for the year to $128.8 million. Bitcoin mining continued to bring in $578.2 million.
Adjusted EBITDA margin for the full year dropped to 35% from 54%. The decline highlights how rapidly initial hiring and infrastructure investments can impact operating leverage.
IREN reported cash and equivalents totaling $5.90 billion at the end of June. Restricted cash on hand stood at an additional $1.67 billion.
The liquidity position was backed by $2.1 billion raised through equity issuance and $3.0 billion from convertible notes. This combination of funding results in both dilution and refinancing risk.
According to management, $4 billion in yearly AI revenue is already under contract. Of that, roughly $1 billion was active at the time of reporting capital-spending report.
Despite the decline in shares, analysts maintain a positive outlook. Out of the group, seventeen analysts hold a Buy consensus, with an average price target of $78.19 analyst forecast.
The next scheduled operational catalyst is the rollout of contracted AI capacity through 2027. The speed at which this occurs will impact how soon revenue aligns with capital expenditures IREN presentations.
Risks: Delays in construction, limited power supply, and heavy reliance on a small number of customers may hinder growth. Additional share offerings or increased borrowing might weigh further on shareholders.
The decline in shares signals concerns about financing rather than a lack of demand. IREN needs to turn $4 billion worth of contracts into cash ahead of a $30 billion expansion that could strain its balance sheet.
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