IREN's GPU Expansion Accelerates: Is Revenue Visibility Improving?

IREN Limited’s IREN expanding GPU footprint is increasingly driving its revenue visibility and stock performance. During the first quarter of fiscal 2026, the company advanced its strategy through a landmark, multi-year AI Cloud contract with Microsoft, confirming its hyperscale AI capabilities and establishing a stable revenue base as GPU deployments ramp through 2026.

IREN plans to scale its GPU fleet from roughly 23,000 units today to 140,000 GPUs by the end of 2026, targeting $3.4 billion in total AI Cloud annualized run-rate revenues. This expansion utilizes only about 16% of its 3 GW secured power portfolio, providing ample growth optionality. Through its vertically integrated model — owning power, data centers and GPU infrastructure — the company minimizes execution risk and enables faster commissioning compared with peers reliant on third-party colocation.

Key performance indicators already reflect this momentum. IREN’s first-quarter fiscal 2026 revenues surged sharply year over year, while adjusted EBITDA improved meaningfully, indicating operating leverage as AI workloads scale. Management also cited strong expected project-level margins on contracted AI Cloud capacity, reinforcing incremental revenue quality and durability.

From a broader industry perspective, sustained global demand for AI compute, tight GPU supply and power constraints across major data center markets remain favorable for IREN. Looking ahead, optionality at sites, such as Childress and the large Sweetwater hub, provides a multi-year runway for additional GPU deployments. Analysts’ projections suggest such an optimistic picture, too, as the Zacks Consensus Estimate for fiscal 2026 revenues reflects year-over-year growth of 125.89% and earnings estimates increase to 79 cents per share from 4 cents.

How Rivals Stack Up Against IREN in GPU Data Centers

Applied Digital APLD stands out among IREN’s rivals by designing and operating purpose-built GPU data centers under long-term hyperscaler contracts, including the $11 billion, 15-year CoreWeave contract. Applied Digital is scaling multiple campuses in parallel, with 700 MW under construction, a targeted 12–14-month construction timeline and an ultra-efficient liquid-cooled design. These strengths position Applied Digital as a strong competitor as demand for GPU power accelerates.

CoreWeave CRWV has emerged as a top rival to IREN by rapidly scaling AI-native, GPU-optimized data centers backed by deep NVIDIA partnerships. CoreWeave operates across 33 sites in the United States and Europe, secures multi-billion-dollar contracts with OpenAI, Microsoft and Meta, and is building large-scale GPU supercomputers. With early GPU access and AI-focused cloud services, CoreWeave’s speed and scale give a clear competitive edge.

IREN’s Price Performance, Valuation & Estimates

Shares of IREN have surged 151.9% in the past six months, outperforming the broader Zacks Finance sector’s return of 7.7% and the Zacks Financial Miscellaneous Services industry’s decline of 14.1%.

IREN’s Six-Months Price Performance

IREN shares are overvalued, as suggested by the Value Score of F. In terms of forward price/sales, IREN is trading at 6.16X compared with the industry’s 3.36X.

IREN’s Valuation

The Zacks Consensus Estimate for IREN’s fiscal 2026 earnings is pegged at 79 cents per share, unchanged over the past 30 days, but marking a substantial year-over-year increase.

IREN currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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