IREN's BTC Revenue Still Dominant Amid Transition to AI Cloud Services
Bitcoin miner IREN continues to derive the majority of its revenue from Bitcoin mining despite transitioning some of its data center capacity towards AI Cloud Services. In its fiscal 2026 results, IREN reported that BTC generated $578.2 million of its total annual revenue of $707 million, accounting for approximately 81.8%. This is a significant portion of its overall revenue, indicating that the company still relies heavily on Bitcoin mining.
The company has been working to retire some of its mining hardware and make room for AI infrastructure as part of its growth strategy in the AI cloud space. However, this transition comes with a cost, as IREN reported a non-cash impairment of $638.8 million primarily tied to decommissioning miners as data center sites were converted for AI workloads.
IRED's AI cloud revenue currently faces an operating gap of $3 billion, with the company targeting its larger run-rate revenue of $4 billion to be operational by December 31. To close this gap, IREN needs to deliver and accept physical infrastructure, as well as meet utilization and pricing assumptions.
The company has raised GPU financing to support the Microsoft contract through a delayed-draw loan priced at one-month SOFR plus 2.25% and senior notes at 5.96%. A separate Mackenzie financing of up to $2.4 billion carries a 9% fixed rate and matures 30 months after each relevant staged funding date.
The company's transition towards AI Cloud Services is ongoing, with Microsoft accepting Horizon 1 in August and Horizons 2 through 4 targeted for phased delivery in calendar Q4 2026. IREN aims to substantially complete the transition of its data center capacity towards AI Cloud Services by year-end.