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IREN Limited (IREN) stock climbed on a $3.4B NVIDIA (NVDA) AI Cloud contract plus a $2.1B equity option.
IREN’s pivot from Bitcoin (BTC) mining to AI infrastructure reshapes the miner peer group, with capital rotating away from Hut 8 (HUT) as NVIDIA validates the strategy.
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Shares of IREN Limited (NASDAQ:IREN) are climbing Friday, extending a powerful run after the company unveiled a transformational partnership with NVIDIA (NASDAQ:NVDA). IREN stock changed hands near $61, building on a 5% opening pop.
The reaction follows an 8-K filed May 7 at 9:05 p.m. ET detailing a $3.4 billion AI Cloud contract alongside a five-year option for NVIDIA to take an equity stake worth up to $2.1 billion. The disclosure has reframed IREN as a marquee AI infrastructure name, not just a Bitcoin miner.
The move caps a remarkable stretch. IREN stock is up 38% over the past week, 71% over the past month, and 813% over the past year, with a market cap now hovering around $20.84 billion.
The headline catalyst is a five-year, $3.4 billion AI Cloud contract for air-cooled Blackwell GPUs, anchoring a broader 5-gigawatt strategic infrastructure partnership. NVIDIA also received a five-year right to acquire up to 30 million IREN shares at $70 each, an option that could deliver roughly $2.1 billion in fresh capital if fully exercised.
That equity option is the tell. NVIDIA doesn't tie its incentives to a partner casually, and a $70 strike sits notably above today's quote, signaling conviction in IREN's multi-year buildout. CEO Daniel Roberts framed the moment bluntly, stating:
The world is structurally short compute... We also signed a 5-year, $3.4bn AI Cloud contract with NVIDIA and entered into a broader strategic partnership that further validates IREN's key role in the AI infrastructure ecosystem.
The earnings report itself was mixed. IREN posted Q3 FY2026 revenue of $144.8 million against a $219.29 million consensus, with a net loss of $247.8 million that included a $140.4 million non-cash impairment tied to decommissioned mining hardware. AI Cloud revenue, however, nearly doubled sequentially to $33.6 million. For broader context on the AI infrastructure buildout, see our recent coverage of NVIDIA's AI infrastructure outlook.
This is the most dramatic miner-to-AI pivot the market has seen, and it puts IREN in direct conversation with Hut 8 (NASDAQ:HUT), whose own AI shift includes a 15-year, $7.0 billion Fluidstack lease backstopped by Alphabet's (NASDAQ:GOOGL) Google. Hut 8 stock is actually down 2% in early trading, a hint that capital may be rotating toward the freshest NVIDIA-validated story.
NVDA stock is also rising, up 2% as investors digest the strategic logic of locking in power-constrained capacity. NVIDIA closed Thursday at $211.50, with a market cap near $5.14 trillion, so the dollar size of the IREN tie-up matters less than the message it sends about GPU placement strategy.
Reddit sentiment captures the mood shift. IREN's aggregate sentiment score jumped to 82, classified as very bullish, with the deal headline drawing 106 upvotes on r/stocks. NVDA discussion across r/WallStreetBets ran even hotter, hitting a sentiment score of 92 at the announcement window.
The bull case rests on IREN's targets: $3.7 billion in annualized recurring revenue by the end of CY2026, $3.1 billion ARR already under contract, and a power footprint scaling to 1,210 megawatts by 2027. IREN's cash sits at a healthy $2.6 billion, providing real runway for the buildout.
IREN stock's bear case is the earnings report itself. Bitcoin (CRYPTO:BTC) mining revenue dropped to $111.2 million from $167.4 million sequentially, and a multi-gigawatt AI deployment carries enormous capital intensity and dilution risk. The forward P/E ratio of 63x leaves little room for execution slippage.
The first test is whether IREN stock holds today's premarket gains into the close, with the $76.87 52-week high in sight. Investors should track the early-2027 ramp on the NVIDIA contract and quarterly progress toward the 150,000 GPU fleet target.
Sell-side context on IREN is constructive but not unanimous. The current analyst target sits at $70.40, with 10 buy ratings against two strong sell ratings, a split that captures the genuine debate here. The next analyst notes following the call could move the stock as much as the deal itself.
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