ZACKS·2025-11-07 16:36Core Insights - IREN Limited reported a significant increase in Q1 FY26 financial results, with total revenue rising 355% year-over-year to $240.3 million and net income reaching a record $384.6 million compared to a net loss of $51.7 million in Q1 FY25 [1] - The company has transitioned from a Bitcoin miner to a leading AI Cloud Service Provider, capable of assembling over 3 gigawatts of power for AI customers [2] - Analysts had previously downgraded EPS estimates for IREN, but expectations may improve due to the booming business outlook [3] Microsoft Partnership - IREN signed a 5-year $9.7 billion AI cloud deal with Microsoft to deploy NVIDIA GB300 GPU systems at its 750MW Childress site, requiring an upfront hardware purchase of $5.8 billion from Dell [4] - The partnership is expected to generate $1.9 billion in annual recurring revenue (ARR) and is viewed positively by investors, with Microsoft highlighting IREN's expertise in AI cloud infrastructure [5] - IREN projects that this alliance could lead to $3.4 billion in AI Cloud ARR by the end of 2026, supported by multi-year contracts with clients such as Together AI, Fluidstack, and Fireworks AI [5] Analyst Outlook - Analysts are expected to revise their models and growth forecasts for IREN following the new partnership and financial results, indicating a potential buying opportunity as EPS estimates have already been significantly reduced [6] - The recent developments have generated excitement among investors regarding IREN's growth outlook in the AI Cloud sector [7]