AI data center firm IREN announced on Thursday that it would delay some infrastructure deliveries for Microsoft while planning a $15 billion spending push. Despite a broader selloff in AI stocks, the Australia-based company reported strong growth in its AI cloud business, boosting its shares by 4% in extended trading. The stock had closed down about 17% earlier, mirroring a broader market downturn that hit chipmakers and neocloud companies, including rival CoreWeave, following Democrats' midterm victory and fears of stricter tech regulation.
IREN attributed the delay to Microsoft requesting network-design changes, which it said would not result in financial penalties. However, the company pushed back its timeline for reaching a $4 billion annualized run-rate revenue target to January, potentially extending to February. Microsoft is reportedly tightening oversight of data center projects run by neocloud providers, including IREN, Nebius, and Nscale, amid rising costs and delays.
The company is building 200 megawatts of data-center capacity for Microsoft in Texas and plans to invest significantly in computing equipment and infrastructure. Its capital commitments rose to $18.95 billion at the end of September, up from $13.81 billion three months earlier, while GPU hardware on its balance sheet nearly tripled to $5.82 billion. Construction in progress stood at about $4.61 billion.
IREN's AI cloud revenue surged to $200 million in the first quarter, up from $71 million in the prior three months. Total revenue reached $228 million, exceeding analysts' estimates of $221.28 million. The company's assets and revenue are supported by contracts with Nvidia, Microsoft, and 13 other partners, with roughly two-thirds of its revenue backlog tied to investment-grade counterparties.