IREN to shift from Bitcoin mining to $3.7B AI cloud, Bernstein

Bernstein projects IREN will convert its Bitcoin mining operations into an AI cloud operator, contracting roughly 150,000 GPUs and targeting about $3.7 billion in annual revenue once the platform is fully operational. The plan rests on a multi-year agreement with Microsoft that includes customer prepayments and a five-year commitment to use IREN’s GPU capacity for AI workloads.

The company outlined an approximately $5.8 billion GPU investment plan. Bernstein’s report says much of the investment is financed through Microsoft customer prepayments and GPU-backed financing facilities, with additional cash and capital sources covering the remainder and keeping borrowing costs relatively low.

IREN intends to repurpose existing facilities in Texas and British Columbia by replacing ASIC Bitcoin rigs with GPUs designed for AI model training and inference. Converting mining sites typically requires changes to power distribution, cooling and rack layout, but can leverage existing grid connections and real estate to reduce time to market compared with building new data centers.

Bernstein wrote, ‘IREN will eventually sunset the Bitcoin mining business as it retrofits existing sites to accelerate cloud deployment,’ describing the change as a phased retrofit rather than an immediate shutdown of mining operations.

The report projects AI cloud revenue will become IREN’s primary income as power capacity shifts from mining to contracted AI computing. Bernstein expects mining revenue to decline over time as more capacity is committed to multi-year GPU services with longer contracts and higher margins.

Bernstein set a $100 price target on IREN shares and an Outperform rating, implying nearly 100% upside from trading below $50 at the time of the report. The firm reduced a prior $125 target, citing a more conservative view on potential dilution and the pace of winding down mining operations.

Other publicly traded miners, including TeraWulf and HIVE Digital, have begun reallocating power and capital to GPU-based cloud services or hybrid operations that retain some mining while building AI capacity.