TLDR
- IREN shares fell nearly 17% to close at $18.03 on November 5.
- A Microsoft-requested design change pushed IREN’s $4 billion revenue target into early 2027.
- AI cloud revenue rose 182% to $200 million, while Bitcoin mining revenue fell 58% to $28 million.
- IREN expects about $15 billion in remaining capital spending in fiscal 2027, with $6 billion still to be financed.
- Bernstein rated IREN Outperform on Friday with a $55 price target.
IREN shares fell nearly 17% on Thursday after the company said a $4 billion annual revenue target would arrive later than planned. The delay came from a design change requested by Microsoft, its largest AI cloud customer.
The Nasdaq-listed company also reported a 58% drop in Bitcoin mining revenue for the quarter ended September 30. IREN plans to mostly finish its exit from Bitcoin mining by the end of 2026.
Microsoft Change Pushes Back Revenue Target
In July, IREN announced $2.8 billion in new contracts and raised its annual recurring revenue target above $4 billion. At the time, the company expected to reach that level by December 2026.
The new results moved that date to January 2027, with a possible extension into February. Co-CEO Daniel Roberts said the more than $4 billion of contracted revenue is funded and now targeted for January.
New multi-year contracts. Disciplined capital allocation. Flexibility to set our own pace of growth. Value at every layer of the platform.
Last quarter, AI Cloud revenue nearly tripled to $200 million.
Other highlights from our Q1 FY27 results:
– Total quarterly revenue… pic.twitter.com/DPDkvgMhX4— IREN (@IREN_Ltd) November 5, 2026
Roberts pointed to a customer-requested design change and supplier timing as the causes. On the earnings call, he named Microsoft as the customer that asked for network infrastructure changes for its 200-megawatt deployment.
IREN shares closed at $18.03 on November 5, down from $21.71 the session before. The drop came during a broader sell-off in AI and tech stocks, and the stock regained some ground in extended trading.
The company expects about $15 billion in remaining capital spending during fiscal 2027. Management said $9 billion will come from cash, committed financing and customer prepayments, while the other $6 billion depends on financing still being sought.
AI Cloud Growth Offsets Mining Decline
AI cloud revenue rose 182% to $200 million in the quarter, up from $71 million in the June quarter. Total revenue climbed 66% to $228 million, and AI cloud made up nearly 88% of it.
Of the AI cloud total, cloud services brought in $135 million and cloud leasing added $65 million. The leasing revenue followed Microsoft’s acceptance of the first Horizon data center deployment in August.
IREN posted a net loss of $263 million, narrower than the $684 million loss in the prior quarter. Adjusted EBITDA rose to $66 million from $19 million, and the AI cloud gross margin held at 86%.
IREN $IREN JUST REPORTED Q1 FY27 EARNINGS
Revenue: $228M vs. $228.3M expected 🟡; +66% QoQ
AI Cloud Revenue: $200M, +182% QoQ
Bitcoin Mining Revenue: $28M vs. $67M last quarter
Adj EBITDA: $66M vs. $19M last quarter
Net Loss: $263M vs. $684M last quarter
AI Cloud Segment Gross… pic.twitter.com/Vb853ZebwY— Financial Index (@financial_index) November 5, 2026
Bitcoin mining revenue fell to $28 million from $67 million in June, and was down about 88% from $233 million a year earlier. The company mined 402 BTC, compared with 2,039 BTC in the same quarter of 2025.
Average operating hashrate dropped to 8.8 EH/s from 45.3 EH/s a year ago as miners were removed to make room for AI hardware. IREN said small mining operations will continue through 2027.
The company sells its mined Bitcoin daily and held no BTC at the end of September. Other miners, including MARA and CleanSpark, have also moved into AI infrastructure.
IREN’s revenue backlog grew 22% to $20.3 billion, with about two-thirds tied to investment-grade customers. Total assets reached $20.6 billion, including $6 billion in data center assets.
After the quarter, IREN expanded a deal with an AI research company through a five-year contract worth about $22 million in annual revenue per megawatt. Roberts said that customer agreed to prepay 90% of the related GPU spending.
The company also signed a shorter deal valued at $40 million in annual revenue per megawatt. Its Horizon 2 through Horizon 4 projects are in late-stage construction, with work continuing at the Mackenzie and Sweetwater sites.
On Friday, Bernstein analysts rated IREN Outperform and raised their price target to $55. They cited the company’s “self-owned, unencumbered” power assets and its control over the pace of development.
