Microsoft (MSFT) Deal Supercharges IREN’s AI Ambitions, Canaccord Says
Canaccord Genuity upgraded IREN, citing a five-year, $9.7 billion GPU cloud contract with Microsoft that shifts focus to AI infrastructure.Summary
Broker Canaccord Genuity views IREN's new five-year, $9.7 billion graphics processing unit (GPU) cloud contract with Microsoft (MSFT) as a major turning point, firmly positioning the company in the AI infrastructure space rather than just bitcoin mining. The broker reiterated its buy rating and significantly raised its price target to $70 from $42, driven by the deal's terms, which include a 20% prepayment from Microsoft and a projected 32% levered internal rate of return (IRR).
IREN will supply Microsoft with Nvidia's GB300 GPUs from its Texas Horizon data centers, a project expected to fund about half of the $3 billion buildout. Analysts noted that Microsoft's upfront payment and credit backing mitigate risks associated with chip supply and power.
Canaccord also highlighted IREN's upcoming two-gigawatt Sweetwater 1 site, due online in 2026, as the next key catalyst due to hyperscaler demand driven by power scarcity, raising its valuation for Sweetwater to $32 per share. IREN's recent strong revenue growth of 355% year-on-year was attributed to its scale, low-cost power, and integration capabilities bridging crypto and AI.
(Source：CoinDesk)