Key Highlights
- IREN shares surged nearly 17% in premarket trading after the company announced $2.8 billion in new AI Cloud contracts.
- The company raised its 2026 AI Cloud revenue target to over $4 billion, with 85% already backed by signed contracts.
- The stock rebounded after recent investor concerns over a $700 million stock award to IREN’s two co-CEOs.
Bitcoin mining company IREN (NASDAQ: IREN) saw its shares surge nearly 17% in premarket trading on Monday.
At the time of reporting, the stock was trading at $39.22, up from last week’s low below $33. According to Robinhood data, the company’s market cap has increased to $12.11 billion, with an average trading volume of $39.63 million.
Why is IREN stock up?
The rally followed the company’s announcement earlier Monday that it had signed $2.8 billion in new multi-year contracts to provide AI Cloud services to AI developers. At the same time, IREN raised its target for annualized AI Cloud revenue by the end of 2026 to more than $4 billion. Its previous target was $3.7 billion.
In a post on X, the company said around 85% of its new revenue target is already backed by signed contracts. This gives investors a clearer picture of how much business IREN has already secured as it continues to expand its AI infrastructure.
Customer payments could reduce expansion costs
The new agreements also include customer prepayments for part of the infrastructure required for their projects. According to IREN, these prepayments cover around 45% of the GPU capital expenditure linked to the new contracts. The contracts have a weighted average duration of around four years, meaning the company is signing customers for longer periods instead of relying only on short-term business.
IREN said demand from large cloud companies, businesses, AI developers, and advanced AI laboratories is now greater than the capacity it has available or plans to build. The company is working with customers on its expansion plans for 2026 and 2027.
In simple terms, IREN will not have to pay for all of the expensive computer chips and related infrastructure on its own. The customer payments can help reduce the amount of money the company needs to raise or spend to build out the new capacity.
IREN said its customer list includes Microsoft, NVIDIA, Perplexity, Figure AI, Together AI, Fluidstack, Fireworks AI, Fal AI, and Hume AI, along with one undisclosed AI developer. The company provides both bare-metal infrastructure, where customers get direct access to computing equipment, and managed cloud services.
$700 million CEO stock award raised concerns
The stock declined last week, falling from around $41 on July 13 to close the week at around $33.04. The decline followed the company’s decision to award its co-founders and co-CEOs, Daniel Roberts and William Roberts, stock awards worth about $700 million.
The award includes 18,198,656 restricted stock units, split equally between the two executives. The shares represent about 5% of the company’s stock, which raises concerns about possible dilution among investors.
However, the awards are not an immediate cash payment. The shares will be released in four equal parts over six years, as long as the CEOs remain with the company. Each portion will also remain locked for another two years after it vests.
IREN’s board approved the award on June 30 following a recommendation from its Compensation Committee. The company also said the CEOs will not receive additional stock awards until the 2031 financial year.
Investors weigh growth against dilution
Monday’s rally followed last week’s sell-off, as investors assessed the company’s expanding AI Cloud business alongside concerns over executive stock compensation.
IREN was previously known as Iris Energy, an Australian Bitcoin miner, before shifting toward AI computing and building renewable-powered data centers for its AI Cloud business.
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