Investment bank Bernstein has lowered its price target on IREN (formerly Iris Energy) from $125 to $100 per share, while maintaining an Outperform rating. The revision reflects the company's ongoing scale-down of Bitcoin mining operations and an increase in shares outstanding from recent equity issuances, not a deterioration in its AI ambitions.
Bernstein analysts highlighted IREN as their top pick among AI-focused Bitcoin miners, citing a strategic pivot toward becoming a superscale AI cloud provider. The firm expects IREN to completely exit cryptocurrency mining within the next few years, with mining revenue projected to reach zero by fiscal year 2030.
Central to the bull case is a major deal with Microsoft. IREN has contracted 77,000 of its 150,000 GPUs to the software giant under a five-year agreement, generating approximately $1.94 billion in annualized revenue. An additional $400 million in contracts have been signed with on-demand cloud customers as of February.
To finance the GPU buildout, IREN secured a $5.8 billion purchase agreement with Dell for Nvidia GB300 processors and obtained $3.6 billion in GPU-backed financing at an interest rate below 6%. Combined with Microsoft prepayments, this covers roughly 95% of the capital needed for the Microsoft contract.
Bernstein projects IREN's AI cloud revenues will reach $2.6 billion in 2027 and climb to $6 billion by 2030, when the company expects to operate 275,000 GPUs—up from 150,000 today. Adjusted EBITDA margins are forecast to stabilize near 82% at scale, suggesting nearly $5 billion in EBITDA by the end of the decade.
The company's 4.5 gigawatts of power holdings across Texas, British Columbia, and Oklahoma underpin long-term growth. Bernstein valued IREN's 3.6 gigawatts of undeveloped capacity at $3 million per megawatt, contributing roughly $10.8 billion to the sum-of-the-parts valuation. Bitcoin mining is assigned zero value in the updated model.
IREN shares recently traded at $43.78, down over 9% on the day amid a broader AI-related stock rout, but up nearly 25% over the past month. At the current price, Bernstein's $100 target implies approximately 128% upside.
