Iris Energy (US:IREN) Forbes·2025-09-30 10:10Core Insights - IREN stock has increased nearly four times year-to-date to approximately $42, despite a recent 10% drop following a downgrade by JPMorgan from neutral to underweight [2] - The company has transitioned from being solely a Bitcoin miner to a provider of AI cloud infrastructure, which has contributed to its stock surge [3] - IREN benefits from low energy costs, fully powered by renewable energy, with average electricity costs at approximately $0.033 per kilowatt-hour, positioning it as one of the lowest-cost operators in the sector [4] Business Model and Growth - IREN operates a dual business model: Bitcoin mining provides consistent cash flow, while AI cloud services offer significant growth potential, with a target of approximately $500 million in run-rate cloud revenue by Q1 2026 [5] - Revenues have surged from $60 million in FY'22 to about $501 million in FY'25, with forecasts indicating over 120% annual growth for FY'26 and FY'27, projecting sales to exceed $2.45 billion by FY'27 [6] - The company has expanded its AI Cloud capacity to approximately 23,000 GPUs and ordered an additional 12,400 GPUs at a cost near $674 million, while controlling around 3 gigawatts of low-cost power capacity [7] Valuation and Market Position - The stock is currently valued at roughly 43 times its forward earnings and about 10 times its forward sales, reflecting the premium investors are paying for anticipated growth [8] - The competitive landscape includes established cloud service providers and other cryptocurrency miners, with notable execution risks and potential stabilization in demand growth for computing resources over time [8]