Although some bitcoin miners have been slowly transitioning into AI data center infrastructure and high-performance computing (HPC) services to diversify their revenue stream away from crypto, there is nothing slow about IREN Limited’s (IREN) pivot.
The company, which is already one of the largest self-operated bitcoin miners in the U.S., is aggressively pushing into the AI cloud services business by making substantial investments in Nvidia (NVDA) Blackwell GPUs and AMD MI350X GPUs.
IREN said this week that it has doubled its AI cloud capacity to 23K GPUs after purchasing an additional 12.4K GPUs. It is now targeting $500 million in AI cloud annualized run-rate revenue (ARR) by the first quarter of 2026.
The company said that it had purchased 7.1K B300s, 4.2K B200s and 1.1K AMD MI350Xs for about $674 million.
IREN procured an additional 4.2K NVIDIA Blackwell B200 GPUs for approximately $193 million in August.
The company said that the “addition of AMD hardware alongside further NVIDIA GPUs broadens IREN’s offering and addressable market.”
IREN noted that there is a “growing trend” of customers contracting capacity prior to delivery, which points to the need for ramping up its supply. It said that it is “in discussions for multi-thousand Blackwell clusters.”
Its shares surged 12.9% on Wednesday.
Wall Street is bullish on AI pivot
“As global demand for compute accelerates, customers are increasingly seeking partners who can deliver scale quickly,” Daniel Roberts, co-founder & co-CEO of IREN, said in a statement. “Doubling our fleet to more than 23,000 GPUs in just a few months highlights the strength of our vertically integrated platform and our ability to meet urgent, long-term demand.”
Bernstein analysts, led by Gautam Chhugani, significantly raised their price target to $75 from $20, while maintaining an Outperform rating.
Chhugani attributed the raised price target to the fact that IREN is building out its own AI cloud business, rather than the way most bitcoin miners are entering the space through partnerships with hyperscalers like CoreWeave (CRWV).
“Amongst Bitcoin miners within our coverage, we are witnessing IREN breaking out from the group,” Chhungani wrote. “Unike most miners, which have struck ‘capital light’ co-location deals with AI cloud partners like CoreWeave (not covered), IREN is building its own AI cloud vertical, investing substantial capex.”
Analysts from Roth Capital Partners, led by Darren Aftahi, also gave IREN a substantial price target boost, raising it to $82 from $35. The firm maintained its Buy rating.
Aftahi cited IREN’s “aggressive GPU expansion and AI cloud strategy” that is driving its upside potential. Roth Capital’s model is estimating that IREN will own 112K GPUs by 2026.
While bitcoin miners have not benefited as much from the bull run that has sent BTC to record prices this year, their pivot to AI cloud and HPC infrastructure services could be changing their fortunes, especially as AI data center infrastructure demands continue to soar.
Other bitcoin miners saw their stocks gain on Wednesday along with IREN: Riot Platforms (RIOT) was up 5.4%, CleanSpark (CLSK) gained 3.9%, Hut 8 (HUT) rose 6.9% and Bit Digital (BTBT) closed nearly 2% up.
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