IREN, a Bitcoin mining company, reported a net loss of $684 million for the fiscal quarter ended June 30, according to its latest corporate disclosure, as its mining operations continue shifting toward AI cloud services. As a result, IREN’s stock fell 8.2% in after-hours trading on Thursday to $37.19.
AI cloud revenue surpassed mining for the first time.
This quarter, IREN AI cloud services revenue reached $70.5 million, up from $33.6 million in the previous quarter and surpassing Bitcoin mining revenue of $66.7 million for the first time. AI cloud services accounted for 51.4% of total revenue for the quarter.
During the same period, the company's total revenue was $137.2 million, a 5% decline from the previous quarter. Mining revenue decreased by 40% quarter-over-quarter, primarily due to some mining facilities being repurposed for AI use.
Impairment and expansion investments weighed on profits.
The company disclosed that adjusted EBITDA decreased by 68% from $59.5 million in the previous quarter to $19.2 million. IREN attributed this decline to higher employee costs and increased upfront investments in AI cloud expansion.
This quarter's loss included a $450.4 million asset impairment, primarily from retired mining equipment, and an additional $127.2 million in write-downs and losses related to equipment held for sale or already disposed of. For the full year, IREN's revenue increased 41% to $707 million; however, due to a $638.8 million impairment, the company recorded a full-year net loss of $702.6 million, compared to a net profit of $869 million in the prior fiscal year.
Contracted volume has reached $4 billion.
IREN stated that the company has signed annual recurring revenue agreements totaling $4 billion and plans to gradually bring them online by the end of this year. As of August 26, approximately $1 billion of this revenue is already generating income.
- The company has secured $6.4 billion in GPU financing.
- Among them, the weighted average interest rate of $3.6 billion is approximately 6%.
- The associated funds correspond to a five-year Microsoft agreement.
IREN stated that the above financing, combined with Microsoft's upfront payment, has covered 96% of the costs for the relevant projects. An additional $2.8 billion in financing will be used for deployments with other customers.
Microsoft and NVIDIA contracts support the transition
In addition to Microsoft, IREN signed a $3.4 billion five-year AI cloud contract with NVIDIA in May, including managed GPU services. This agreement is also part of a broader collaboration between the two parties to deploy up to 5 gigawatts of AI infrastructure.
Additional information: Bernstein analysts expect that as mining hardware is gradually replaced by GPUs, IREN may largely exit its Bitcoin mining operations around 2030.