NEXT PICK · Market Insights
4 billion ARR—can it support a market value of 14.4 billion?
Monday, July 20, 2026
A $2.8 billion new contract sparked a 20% jump, but the earnings are still declining
IREN, which was being hammered down by capital a month ago and plunged 43% in 30 days, suddenly surged nearly 20% last night, closing at $40.2. What ignited it was a newly signed $2.8 billion AI cloud contract, along with a repeatedly forwarded statement—the annualized recurring revenue (ARR) target was raised from $3.7 billion to over $4 billion, with about 85% already locked in contracts.
The market has almost recovered the week's losses in almost a day, yet it is still 18% below its own 200-day moving average. So, is this the true turning point in the transformation story, or is it yet another emotional rebound ignited by a single announcement?
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Latest price
$40.2
▲ +19.57%
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Signing a new contract
2.8 billion USD
▲ ARR rose to 4 billion+
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Distance from the 200-day moving average
-18%
▼ The rebound remains below
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From a Bitcoin mining farm to a 'sovereign hash power factory'
IREN was formerly Iris Energy, renamed in November 2024, headquartered in Sydney. Essentially, it is a vertically integrated enterprise that owns electricity, builds its own data centers, and operates its own computing power. It mines Bitcoin with one hand and leases NVIDIA GPUs to AI developers on the other.
Of the $501 million in FY2025 revenue, Bitcoin mining contributed $485 million, while AI cloud only contributed $16.4 million—in other words, the 'AI computing power' story that capital markets are currently chasing was just a budding stream last year.
The real moat is not in software, but in power access, land approval, and self-built data centers. When global GPUs and power are in short supply, a company that can connect electricity and take orders itself is indeed harder to replace than a purely leasing second landlord. But here's the problem—if AI demand fades, will these heavy assets become a heavy stone weighing on the financial statements?
The past of 29x price-to-sales ratio, or the future of 3.6x ARR?
Statically, a $14.4 billion market cap is pressed against FY2025 revenue of $501 million, a price-to-sales ratio close to 29 times, which is hardly cheap. As for the 52x P/E ratio, it is even less relevant—it has been disrupted by fair value fluctuations in convertible-related derivatives.
The most recent quarter (ending March 2026) is clear evidence: revenue was $144.8 million, marking the second consecutive quarter of decline; Net losses widened to $247.8 million. Mining revenue weakened after the halving. Although AI cloud revenue doubled quarter-on-quarter to $33.6 million, its scale was still too small to absorb the downward gap.
But the bulls changed their anchor
If the ARR target of over $4 billion is realized, the forward multiple corresponding to the $14.4 billion market cap will be compressed to about 3.6 times. The same company, one 29 times the past, the other 3.6 times the future—which number are you willing to pay for?
The demand signal has arrived, but the execution verification has not yet arrived
Putting the 50-day moving average at 52.71, the 200-day moving average at 49.01, and the current price at 40.2 side by side, the answer is straightforward: even after last night's sharp rise, the stock price remains deeply below both moving averages, the medium-term trend has not reversed, and the market has not truly placed its trust vote.
This is a typical scene on the 'eve of a turning point'—ARR raised, major clients sign contracts, and demand signals are loud enough; However, revenue has continued to decline quarter-on-quarter, net losses have widened, and the execution side has yet to deliver a reassuring answer. The story reached a turning point, but the performance still lacked a financial report to stamp it.
A group of miners turned around at the same time—who would succeed in the computing power business first?
IREN is facing a whole track of collective transformation. Old rival Hut 8 has signed a 15-year, $9.8 billion AI data center lease, and Cipher is also pushing data centers; They are rooted in North America, with more mature infrastructure and cheaper labor.
On the other side, Neocloud newcomers like Nebius and CoreWeave are also competing for AI developers' computing power orders and attention from the same batch of funds. IREN's differentiation lies in the sovereign data center layout of Australia and Canada, which meets compliance requirements for data localization.
But governance is its weak spot—the co-CEO's approximately $706.5 million equity incentive with a pure service period and no performance evaluation has been compared externally to Hut 8 and Cipher's performance-focused design. When everyone is turning around, why should we believe this company will be the first to gain a foothold?
How much can it scoop from a pool worth tens of billions?
The global data center market is expected to reach about $280 billion in 2024, and driven by AI, is expected to surpass $500 billion by 2030—this is the ceiling for IREN. But what it can truly reach is the sovereign computing power markets of Australia and Canada, with scales ranging from several billion to tens of billions of dollars.
Currently, IREN's actual service scale is only $500 million in FY2025 revenue, plus newly signed contracts. What truly raises the ceiling is the rumored Anthropic Australia construction plan worth about $22 billion and 1.4 GW—IREN's 800 MW Bundey campus is one of the candidates, but the decision has yet to materialize. The penetration rate is still only single digits; the bulk of the story is hidden in the "ifs."
If these "ifs" are fulfilled, it will be ridiculously cheap
If you lay out the ledger of the bulls, the logic is actually quite focused:
| ▲ Bull Case |
| ① | One day, a new $2.8 billion AI cloud contract was signed, raising the ARR target from $3.7 billion to over $4 billion, with about 85% already locked in contracts |
| ② | Hardcore client list: Microsoft, NVIDIA, Perplexity, Figure AI, with Microsoft single deals totaling $9.7 billion and a five-year term |
| ③ | The new contract includes a customer advance payment covering about 45% of GPU capital expenditure, directly reducing financing pressure, with a weighted term of about four years |
| ④ | The vertically integrated model holds its own power and data center, giving it priority delivery capabilities when both GPU and power are in short supply |
| ⑤ | At the end of April, with about $2.6 billion in cash in hand, there was no shortage of ammunition for the transformation |
| ⑥ | If Anthropic's approximately $22 billion Australian order goes to IREN, the future revenue potential will be fully unlocked |
But the financial statements are still going downward, and the story can't hold up valuations
The bears' rebuttal was equally sharp:
| ▼ Bear Case |
| ① | The most recent quarter's revenue was $144.8 million, down for two consecutive quarters, and the AI cloud growth still can't keep up with the losses from mining |
| ② | Net losses widened from $155.4 million last quarter to $247.8 million, with profitability continuing to deteriorate |
| ③ | FY2025's net profit of $86.9 million includes a large one-time fair value gain, with operating profits being extremely thin |
| ④ | With a price-to-sales ratio of nearly 29 times and a price-to-earnings ratio of 52 times, the valuation requires extremely high growth to sustain itself |
| ⑤ | The stock price is still about 18% below the 50-day and 200-day moving averages, and last night's surge felt more like an oversold rebound than a trend reversal |
| ⑥ | Co-CEOs receive about $706.5 million in equity incentives with no performance conditions, causing a misalignment between shareholder and management interests |
| ⑦ | Bitcoin prices and GPU supply chain fluctuations could impact core profits at any time |
Financial reports, big orders, Australian rulings—three cards await a turn
In the coming months, IREN's stock price will be dominated by three types of events: whoever pays first will have the say in the next move:
| • | FY2026 full-year financial report (reporting period June 2026, expected August): Verify the progress of executing 4 billion ARR and whether revenue can stop declining—the direction determines success or failure |
| • | Anthropic's approximately $22 billion, 1.4 GW Australian construction plan realized: Whether the IREN 800 MW park will win the bid is positive but uncertain |
| • | The pace of capacity delivery and advance payments for newly signed contracts: fulfilling the contract strengthens credit, while defaulting reverts the original state |
A roller coaster ride that rises and falls with coin prices and narratives
IREN went public on Nasdaq in 2021 under the name Iris Energy. Early on, it was a pure Bitcoin miner, riding the dividends of the crypto bull market. During the bear market of 2022–2023, its price was dragged down from a high point, with its stock price dropping to single digits at one point.
After renaming to IREN in 2024 and betting on AI computing power, the narrative was reignited: FY2025 revenue rose to $501 million, turning positive in net profit. But over the past month, it fell another 43% amid a collective correction in the AI and data center sectors, until last night's contract finally pulled sentiment back. It more than doubled in 12 months, then plunged again in 30 days—the character of this stock was already written in the Beta of 4.28.
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⚠️ Risk Notice
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🟡 Neutral Demand signals are genuine, but profits and revenue have yet to keep up; some of the positive factors have already been reflected in last night's surge. |
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💬 Discussion In short: This is more like an oversold rebound than a fundamental turning point; be cautious when chasing highs. For its current real-time buy and sell positions, post IREN to the official account to check. |
Data source
| • | Source: NextPick real-time snapshot + company FY25/Q3 FY26 earnings reports and 8-K announcements + SEC archives + cross-checking of public reports from mainstream financial media (Bloomberg, TechCrunch, Seeking Alpha, etc.). |