IREN drops 8% despite AI cloud revenue overtaking bitcoin mining

IREN shares fell 8% in Friday pre-market trading after fiscal fourth-quarter results showed the near-term costs of its shift from bitcoin mining to AI cloud services. AI cloud revenue more than doubled quarter over quarter to $70.5 million. AI cloud revenue exceeded bitcoin mining revenue of $66.7 million for the first time. AI cloud services generated 51.4% of quarterly revenue. Bitcoin mining generated 48.6%. Total quarterly revenue fell 5% from the previous quarter to $137.2 million. Adjusted EBITDA fell 68% to $19.2 million. Employee costs increased during the quarter. IREN invested ahead of its AI cloud expansion. Quarterly revenue was 85% lower than in the equivalent quarter a year ago. Adjusted EBITDA was 93% lower than in the equivalent quarter a year ago. IREN reported a $684 million net loss. The loss included a $450.4 million non-cash impairment that was primarily related to decommissioning bitcoin mining hardware. IREN is converting mining sites to support AI infrastructure. The conversion created costs before the associated cloud revenue was fully recognized. IREN reported $4 billion of contracted annualized run-rate revenue tied to its 2026 capacity. Only $1 billion of that capacity is currently operational. Bitcoin mining revenue fell 40% from the previous quarter. IREN redirected power and infrastructure toward its expanding AI business.