IREN Stock Skyrockets: Analyst Boosts Price Target by 67% After Microsoft GPU Cloud Deal

IREN just became Wall Street's favorite AI infrastructure play—and the numbers don't lie.

When Microsoft bets, markets listen. The tech giant's GPU cloud deal with IREN sent analysts scrambling to upgrade their models—resulting in a blistering 67% price target hike. Suddenly, every quant's spreadsheet smells like freshly printed money.

Behind the surge: IREN's data centers are now the backbone of Microsoft's AI ambitions. Forget 'proof of work'—this is proof of profit, at least until the next earnings call disappoints the algo-traders.

TLDR

• Iren Limited secured a five-year, $9.7 billion GPU cloud contract with Microsoft, with 20% prepayment upfront
• Canaccord raised its price target on IREN stock to $70 from $42, maintaining a buy rating
• The deal includes supplying Microsoft with Nvidia GB300 GPUs from Iren’s Horizon data centers in Texas
• Iren’s latest quarter showed revenue of $240.3 million, up 355% year-over-year
• The company’s Sweetwater 1 site, a two-gigawatt facility coming online in 2026, represents the next major growth catalyst

Iren Limited closed 6.8% lower on Friday at $62.38. But analysts remain bullish after the company announced a major partnership with Microsoft.

IREN Limited, IREN

The Bitcoin miner landed a five-year, $9.7 billion GPU cloud contract with Microsoft. Canaccord Genuity called the deal a turning point for the company.

The broker raised its price target on IREN shares to $70 from $42. It maintained its buy rating on the stock.

Microsoft will prepay 20% of the contract value upfront. That gives Iren the capital it needs to purchase the required GPUs and build out infrastructure.

The deal carries a projected 32% levered internal rate of return. Canaccord analysts led by Joseph Vafi said the agreement could shift investor focus from mining to AI.

Iren will supply Microsoft with Nvidia’s GB300 GPUs. These chips will come from the company’s Horizon data centers in Texas.

The Horizon project has a price tag of roughly $3 billion. The Microsoft contract is expected to fund about half of that buildout.

Contract Details and Risk Factors

Chip and power risks remain on the table. But Microsoft’s upfront payment and credit backing help reduce some of that uncertainty, according to Canaccord.

The deal quintuples Iren’s annual revenue run rate. The company projected $500 million in ARR for this year, which will jump to $2.5 billion once the full contract is operational.

By the end of 2026, Iren expects its ARR to reach $3.4 billion. That’s quite a leap for a company that started as a bitcoin miner.

In early October, Iren announced it had secured multiyear contracts with leading cloud providers. Those contracts covered 11,000 of Iren’s 23,000 AI GPUs, generating about $225 million in revenue.

The contracts averaged two years with rates that allowed for a two-year payback period. Management said it remained on track to rent out the remaining 12,000 chips by year-end.

After the stock rallied in October, Iren raised $1 billion through a convertible notes offering. The company initially planned to raise just $875 million, but the offering was oversubscribed.

Sweetwater Expansion Plans

The convertible notes came with no coupon and a 42.5% conversion premium. That means they WOULD convert to stock if shares hit about $91, given that the stock traded around $64 at the time.

Iren used $56.7 million of the proceeds to buy capped calls. These limit dilution and increase the effective conversion price to above $120.18 per share.

Canaccord pointed to Iren’s upcoming Sweetwater 1 site as the next key catalyst. The two-gigawatt facility is due online in 2026.

Power scarcity is driving demand from hyperscalers. The broker raised its Sweetwater valuation to $32 per share.

Iren has already contracted land and power for future expansion. The company said it’s in discussions to expand beyond its current 23,000 GPUs to up to 100,000 GPUs.

Iren’s latest quarter showed $240.3 million in revenue. That’s up 355% year-over-year.

The current contracted $2.5 billion in ARR only covers about 350 MW of capacity. Iren has another 2 GW of contracted power at Sweetwater that hasn’t been brought online or contracted yet.

The stock now trades at 5 times its 2026 guidance for ARR. Canaccord highlighted Iren’s scale, low-cost power, and integration as advantages that bridge crypto and AI.