Analysts Highlight IREN's Cloud Services As Long-Term Engine Behind Continued Stock Rally IREN Limited experienced a significant stock rally on Friday, building upon the momentum established the previous day. This surge reflects the company’s impressive fiscal 2025 results, which decisively surpassed Wall Street’s expectations. IREN’s robust performance was underscored by a substantial $168 million investment in GPU expansion, specifically designed to accelerate its strategic push into the burgeoning AI cloud market. The company’s financial results showcased a remarkable transformation, with revenue soaring over 100% year-over-year, reaching a noteworthy $501 million. Crucially, net income dramatically shifted from a prior-year loss to a substantial $86.9 million, while adjusted EBITDA witnessed an astonishing tenfold surge, reaching $269.7 million. These figures powerfully demonstrate IREN’s dynamic evolution, moving beyond its origins as a dedicated Bitcoin miner to become a versatile and rapidly expanding provider of AI infrastructure solutions. The core narrative driving this success is the accelerating growth of IREN’s Cloud Services division, a key area identified by analysts as the long-term engine powering the company’s continued stock rally. JP Morgan analyst Reginald L. Smith emphasized that while Bitcoin mining initially contributed to the company’s strong performance, the true story lies in the exponential growth of IREN’s cloud offerings. Management’s strategic foresight is evident in their planned near-term capital expenditures, totaling approximately $500 million. This investment will secure over 9,000 additional NVIDIA GPUs, expanding IREN’s total GPU fleet to roughly 10,900 units by the end of 2025. Industry experts anticipate that this scale-up will drive annualized Cloud Services revenue to a significant range of $200 million to $250 million by year-end 2025, a dramatic increase from the current $26 million. This substantial revenue projection highlights the immense potential of IREN’s cloud infrastructure as a key growth driver.

Furthermore, the company’s strategic deployment of these advanced GPUs is meticulously planned. The initial focus is on expanding operations at the company’s 50 MW Prince George facility in British Columbia, a key location chosen for its strategic advantages. Future rollouts are also being considered, with plans to leverage the upcoming 50 MW Horizon 1 data center in Texas and preparations underway for Horizon 2, a 50 MW liquid-cooled site in Childress. This diversified approach to data center expansion demonstrates IREN’s commitment to scaling its cloud services across multiple geographic locations, ensuring optimal performance and responsiveness to evolving market demands.

Solid Balance Sheet and Strategic Financing Financially, IREN’s strong position is further bolstered by its impressive financial standing. As of June, the company held a healthy cash reserve of $564 million. Importantly, they have secured financing agreements covering approximately 40% of their planned GPU investments, providing a robust framework for their ambitious expansion strategy. Management anticipates that the remaining funding will be efficiently managed through existing liquidity and consistent quarterly operating cash flow, which reached a record $90 million during the recent period. This impressive cash operating profit of $89 million, boasting a remarkable 47% margin, underscores the company’s operational efficiency and financial discipline. While slightly below JP Morgan’s initial forecast due to increased spending on sales, general, and administrative (SG&A) expenses associated with bolstering their Cloud Services team, this outcome remains a testament to IREN’s strategic investments.

Positive Analyst Outlook Adding further fuel to the bullish sentiment, Canaccord Genuity analyst Joseph Vafi reiterated a Buy rating on IREN and decisively raised the price forecast from $23 to $37, reflecting his confidence in the company’s long-term growth prospects. This optimistic outlook is largely driven by the anticipated continued expansion of IREN’s Cloud Services, which analysts believe represents a significant untapped opportunity within the rapidly growing AI market. Price Action Reflecting the overwhelmingly positive market response, IREN shares experienced a substantial surge on Friday, climbing 16.3% to close at $26.67. This significant price movement underscores the market’s recognition of IREN’s strategic positioning and the compelling growth potential of its Cloud Services division. Benzinga Rankings provide you with vital metrics on any stock – anytime. © 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.