Core Viewpoint - Iren Limited's stock has experienced a significant decline of nearly 20% this week, primarily due to the sell-off in Bitcoin and the lack of new AI deals, despite a doubling of AI cloud revenue [1][6][7]. Group 1: Company Performance - Iren Limited, originally a Bitcoin miner, has transitioned to an AI cloud infrastructure company, with Bitcoin mining revenue still accounting for 90% of total revenue as of the quarter ended December 31, 2026 [5]. - The company reported that 95% of the financing for capital spending on GPU purchases under its Microsoft contract is secured, including a prepayment of nearly $2 billion from Microsoft [7]. Group 2: Market Context - The recent sell-off in Bitcoin has adversely affected Iren more than other AI cloud companies, despite the positive growth in AI cloud revenue, which is still emerging from a low base [6]. - The absence of new AI deals in the latest earnings report likely disappointed investors, contributing to the stock's decline [7].

Core Viewpoint - IREN stock is facing challenges due to concerns regarding its cryptocurrency mining operations, despite the company's shift towards artificial intelligence computing [1] Group 1: Cryptocurrency Mining Operations - The company has experienced negative sentiment surrounding its cryptocurrency mining activities, which has impacted its stock performance [1] Group 2: Shift to Artificial Intelligence - IREN is pivoting towards artificial intelligence computing as part of its strategic direction, indicating a potential long-term growth opportunity [1]

IREN (IREN) earnings showed weaker than expected headline results, with the company missing consensus on both revenue and earnings per share (EPS) as it accelerates its transition from bitcoin mining to AI Cloud. Financially, Q2 revenue declined to $184.7 million, missing expectations and down from $240.3 million in Q1, while the company reported a net loss of $155.4 million, also below consensus. IREN secured $3.6 billion of GPU financing for its Microsoft contract which together with a $1.9 billion cus ...

Financial Performance - The company reported an earnings per share (EPS) of -$0.52, significantly missing the estimated EPS of -$0.24, indicating ongoing financial difficulties [1][6] - Revenue for the quarter was $184.7 million, falling short of the anticipated $227.3 million, although this represents growth from $119.59 million in the same quarter the previous year [2][6] Market Reaction - Following the earnings announcement, the company's stock experienced an 11% decline, reflecting widespread investor disappointment and contributing to a larger sell-off in the AI sector [3][6] Valuation Metrics - The company has a price-to-sales ratio of approximately 16.26, an enterprise value to sales ratio of around 16.16, and an enterprise value to operating cash flow ratio of about 25.87 [4] Strategic Focus - Co-CEO Daniel Roberts emphasized the company's progress in capacity expansion, customer engagement, and capital formation, highlighting the development of a scaled AI Cloud platform and timely delivery of data center capacity, which may lay the groundwork for future growth [5]

Market Overview - Major U.S. stock indexes closed lower, with the Dow Jones Industrial Average down 1.2% to 48,908.72, the S&P 500 falling 1.2% to 6,798.40, and the Nasdaq dropping 1.59% to 22,540.58 [1] Amazon - Amazon's stock closed down 4.42% at $222.69, with an intraday high of $226.31 and a low of $220.38; the stock's 52-week range is between $258.60 and $161.43; in after-hours trading, the stock crashed nearly 11% to $198.21 [2] IREN Ltd - IREN's shares dropped 11.46% to close at $39.79, with an intraday high of $44.92 and a low of $38.90; the stock's 52-week high and low are $76.87 and $5.12, respectively; in after-hours trading, the stock plummeted 18.37% to $32.48 [3] - IREN reported a sharp second-quarter loss, missing earnings estimates with an EPS of -$0.52 versus expectations for a -$0.18 result; revenue rose to $71.21 million year over year [4] Roblox Corp - Roblox saw a decline of 3.96%, closing at $60.57, with an intraday high of $64.84 and a low of $60.07; the stock's 52-week range is $150.59 to $50.10; the stock gained 7.3% to $65 in extended trading [5] Reddit Inc - Reddit's stock fell 1.07% to $151.05, with an intraday high of $155.34 and a low of $148.50; the stock's 52-week range is $282.95 to $79.75; the stock gained 4.55% to $157.92 in after-hours trading [6] Strategy Inc - Strategy's shares plummeted 17.12% to $106.99, with an intraday high of $122 and a low of $104.17; the stock's 52-week high and low are $457.22 and $104.16 [7]

分组1 - IREN Limited (IREN) shares are experiencing a decline in after-hours trading following the release of second quarter results amid a broader sector selloff affecting high-multiple AI companies [1] - The market sentiment has shifted, causing investors to become increasingly cautious regarding investments in high-multiple AI players [1]

分组1 - IREN Limited reported a quarterly loss of $0.44 per share, significantly worse than the Zacks Consensus Estimate of a loss of $0.09, marking an earnings surprise of -371.60% [1] - The company posted revenues of $184.69 million for the quarter ended December 2025, missing the Zacks Consensus Estimate by 16.49%, compared to year-ago revenues of $119.59 million [2] - IREN Limited shares have increased by approximately 19% since the beginning of the year, outperforming the S&P 500's gain of 0.5% [3] 分组2 - The current consensus EPS estimate for the upcoming quarter is -$0.07 on revenues of $268.55 million, while for the current fiscal year, it is $0.67 on revenues of $1.12 billion [7] - The Zacks Industry Rank for Financial - Miscellaneous Services is in the top 33% of over 250 Zacks industries, indicating a favorable outlook for the industry [8]

Financial Data and Key Metrics Changes - Total revenue for Q2 FY 2026 was $184.7 million, a decrease of 23% compared to the prior quarter, primarily due to lower Bitcoin mining revenue [19][21] - Adjusted EBITDA declined mainly due to reduced Bitcoin mining revenue, partially offset by lower payroll tax accruals and power costs [20][21] - The company recorded $31.8 million in mining hardware impairment associated with the transition to AI cloud, compared to $16 million in the prior period [21] Business Line Data and Key Metrics Changes - AI cloud revenue is accelerating as deployments ramp, with significant growth expected from the commissioning of new GPUs at the Prince George site [19][22] - The company has secured $2.3 billion of annualized revenue run rate under contract, including approximately $0.4 billion at Prince George, which is expected to increase as negotiations finalize [16][17] Market Data and Key Metrics Changes - The company has secured underwriting commitments for $3.6 billion of GPU financing at an interest rate of less than 6%, covering 95% of GPU-related CapEx for the Microsoft contract [5][23] - Demand for AI cloud services remains strong, with multiple advanced negotiations underway for larger scale deployments [6][16] Company Strategy and Development Direction - The company focuses on a vertically integrated model, controlling the design, build, and operation of its data centers, which enhances cost management and service quality [11][14] - The strategy revolves around the "three Cs": capacity, customers, and capital, which reinforce each other to support growth [8][26] - The company aims to scale into one of the world's largest AI cloud platforms, leveraging its secured power and operational capabilities [10][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing transition to AI cloud, expecting subsequent quarters to reflect a growing contribution from AI cloud revenues [22] - The company anticipates reaching a targeted $3.4 billion annualized revenue run rate by the end of 2026, utilizing only about 10% of its secured power capacity [17][27] Other Important Information - The company has secured a new 1.6GW site in Oklahoma, expanding its total secured power to over 4.5GW, which is crucial for future growth [6][14] - The company has a strong cash position of $2.8 billion and has secured $9.2 billion from various financing sources to support growth [24] Q&A Session Summary Question: Update on ERCOT batch processing and its impact on Sweetwater - The company believes Sweetwater will likely be included in the batching process, securing the full 2GW of power [31] Question: Thoughts on verticalized AI cloud versus colocation - The company sees AI cloud as capturing more value than colocation, with higher returns per megawatt [33][36] Question: Update on energization dates for Sweetwater - Sweetwater One is on track to energize in Q2, with customer engagement expected to improve due to the batching process [51][52] Question: Revenue recognition timeline for contracted revenue - Revenue from Prince George is already operational, while the Microsoft contract will come online progressively throughout the year [55] Question: Pricing environment for cloud deals compared to colocation - The company is seeing strong demand and is open to longer contract tenors, with a focus on maximizing the value of each megawatt [60][61]

Financial Data and Key Metrics Changes - Total revenue for Q2 FY 2026 was $184.7 million, a decrease of 23% compared to the previous quarter, primarily due to lower Bitcoin mining revenue [19][21] - Adjusted EBITDA declined mainly due to reduced Bitcoin mining revenue, partially offset by lower payroll tax accruals and power costs [20][21] - The company recorded $31.8 million in mining hardware impairment associated with the transition to AI cloud, compared to $16 million in the prior period [21] Business Line Data and Key Metrics Changes - AI cloud revenue is accelerating as deployments ramp up, with significant growth expected from the commissioning of new GPUs at the Prince George site [19][22] - The company has secured $2.3 billion in annualized revenue run rate under contract, including approximately $0.4 billion at Prince George, with expectations for this to increase [16][17] Market Data and Key Metrics Changes - The company has secured underwriting commitments for $3.6 billion of GPU financing at an interest rate of less than 6%, which supports a $9.7 billion AI contract with Microsoft [5][23] - Demand for AI cloud services remains strong, with multiple advanced negotiations underway for larger scale deployments [6][16] Company Strategy and Development Direction - The company focuses on a vertically integrated model, controlling the design, build, and operation of its data centers, which enhances cost management and service quality [11][14] - The strategy revolves around the "three Cs": capacity, customers, and capital, which are interdependent and reinforce each other [8][26] - The company aims to scale into one of the world's largest AI cloud platforms, leveraging its secured power and operational capabilities [10][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing transition to AI cloud, expecting subsequent quarters to reflect a growing contribution from AI cloud revenues [22] - The company highlighted that demand is not a limiting factor for reaching its $3.4 billion annualized revenue target by the end of 2026, with significant runway for growth beyond that [17][27] Other Important Information - The company has secured a new 1.6 GW site in Oklahoma, increasing its total secured power to over 4.5 GW, which is crucial for future growth [7][14] - The company ended January with a strong cash position of $2.8 billion and has secured $9.2 billion from various financing sources to support growth [24] Q&A Session Summary Question: Update on ERCOT and its impact on Sweetwater - The company believes Sweetwater will likely be included in the batching process, securing the full 2 GW of power [31] Question: Economics on colocation versus AI cloud - The company sees AI cloud as capturing higher value compared to colocation, with ongoing strength in demand for cloud services [33][34] Question: Energization dates for Sweetwater - Sweetwater 1 is on track to energize in Q2, with customer engagement expected to improve due to the batching process [51][52] Question: ARR recognition timeline - Revenue from the Microsoft contract is expected to commence progressively over the year, starting in Q2 [55] Question: Pricing environment for cloud deals - The company is seeing strong demand and interest in longer tenors for cloud contracts, indicating a favorable pricing environment [58][60]

Financial Data and Key Metrics Changes - Total revenue for Q2 FY 2026 was $184.7 million, a decrease of 23% compared to the previous quarter, primarily due to lower Bitcoin mining revenue [19] - Adjusted EBITDA declined mainly due to reduced Bitcoin mining revenue, partially offset by lower payroll tax accruals and power costs [20] - The company recorded $31.8 million in mining hardware impairment associated with the transition to AI cloud, compared to $16 million in the prior period [20] Business Line Data and Key Metrics Changes - AI cloud revenue is accelerating as deployments ramp up, with a significant portion of revenue now coming from AI workloads [19] - The company expects to deliver 140,000 GPUs by the end of 2026, positioning for an annualized run rate revenue of $3.4 billion [5][17] - Approximately $2.3 billion of annualized revenue run rate is under contract, including around $0.4 billion at the Prince George site [16] Market Data and Key Metrics Changes - The company has secured underwriting commitments for $3.6 billion of GPU financing at an interest rate of less than 6%, covering 95% of GPU-related CapEx [4][22] - Demand for AI cloud services remains strong, with multiple advanced negotiations underway for larger scale deployments [5][16] - The company has secured over 4.5 GW of power, with a new 1.6 GW site in Oklahoma, enhancing its competitive position in a power-constrained market [6][14] Company Strategy and Development Direction - The company focuses on a vertically integrated model, controlling its own data centers and operations to manage costs and service quality [11] - The strategy revolves around the "three Cs": capacity, customers, and capital, which reinforce each other to support growth [8][26] - The company aims to scale into one of the world's largest AI cloud platforms, leveraging its secured power and customer demand [10][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing transition to AI cloud, expecting subsequent quarters to reflect a growing contribution from AI cloud revenues [21] - The company highlighted that demand is not a limiting factor for reaching its $3.4 billion ARR target by the end of 2026, with significant runway for growth beyond that [17][27] - Management emphasized the importance of selecting the right long-term partnerships to create lasting value [17] Other Important Information - The company has a strong cash position of $2.8 billion and has secured $9.2 billion from various financing sources to support growth [23][24] - The company is actively monitoring the colocation market but sees AI cloud as a more valuable opportunity at present [32][36] Q&A Session Summary Question: Update on ERCOT and its impact on Sweetwater - Management indicated that Sweetwater is likely to be included in the batching process, securing the full 2 GW of power [30] Question: Economics on colocation versus AI cloud - Management noted that AI cloud offers higher value compared to colocation, with better dollar-per-megawatt returns [32][35] Question: Energization dates for Sweetwater - Sweetwater 1 is on track to energize in Q2, with customer engagement expected to improve due to the batching process [51][52] Question: ARR recognition timeline - Revenue from the Microsoft contract is expected to commence progressively over the year, starting in Q2 [54] Question: Pricing environment for cloud deals - Management reported strong ongoing demand and a willingness from customers for longer contract tenors, indicating a favorable pricing environment [59]