IREN Secures $9.7B AI Cloud Contract with Microsoft
IREN signs a $9.7 billion AI cloud services contract with Microsoft, enhancing Azure AI capabilities amid a global GPU shortage.
IREN Secures $9.7 Billion AI Cloud Services Contract with Microsoft
IREN, a former bitcoin mining powerhouse turned AI cloud infrastructure provider, has signed a landmark $9.7 billion contract with Microsoft, marking a major milestone in the evolving AI cloud services landscape. Announced on November 3, 2025, this five-year agreement grants Microsoft access to cutting-edge Nvidia GB300-based AI systems hosted by IREN in Texas, positioning Microsoft to significantly expand its Azure AI capabilities amid an ongoing global GPU shortage.
Background: From Bitcoin Mining to AI Cloud Powerhouse
Originally established as a large-scale bitcoin miner, IREN has strategically transitioned into the neocloud sector—a burgeoning group of companies repurposing cryptocurrency mining hardware and data center infrastructure to support artificial intelligence workloads. This pivot reflects the rising demand for specialized AI compute power, particularly GPUs, which are critical for large language models and deep learning applications.
IREN’s CEO described the move as a natural evolution: “Our extensive experience managing high-density GPU clusters for mining has uniquely positioned us to meet the surging AI compute demands. This partnership with Microsoft validates our vision and operational model.” The deal is also a vote of confidence in IREN’s ability to scale AI infrastructure rapidly and efficiently.
Details of the $9.7 Billion Deal
- Contract Duration: Five years
- Scope: IREN will provide Microsoft with access to Nvidia GB300-based AI cloud capacity, hosted in Texas data centers specially optimized for AI workloads.
- Investment in Hardware: IREN plans to invest approximately $5.8 billion in GPUs, primarily sourced from Dell, to expand its AI compute fleet.
- Expected Revenue: The deal is projected to generate $1.9 billion in annual revenue for IREN.
- Strategic Importance: This partnership addresses Microsoft’s urgent need for GPU resources to support Azure AI and other AI-powered services amid global supply constraints.
The agreement underscores the growing recognition of bitcoin miners’ hardware fleets as strategic AI compute assets rather than merely volatile cryptocurrency mining rigs. IREN’s infrastructure can handle the energy-intensive demands of AI training and inference, creating value beyond traditional mining economics.
Market and Industry Impact
Following the announcement, IREN’s shares surged over 30% in premarket trading, adding to a remarkable 500% rally this year driven by increased investor confidence in AI-related hardware providers. Industry analysts hail the deal as one of the largest commercial validations of the neocloud business model, where data centers originally built for crypto mining are repurposed to serve AI workloads.
This transaction also reveals the intensifying competition for GPU resources among tech giants. Microsoft’s purchase agreement with IREN is part of a broader strategy to secure AI infrastructure amid rising demand for cloud AI services, competing with peers like Google and Amazon.
Experts predict that contracts like this will accelerate the growth of neocloud companies, which are uniquely positioned to scale AI compute capacity quickly due to their existing high-density GPU infrastructure and operational expertise. The neocloud sector is expected to become a key pillar in the AI cloud ecosystem over the next decade.
Broader Context: AI Cloud Capacity and GPU Shortages
The global GPU shortage has been a bottleneck for AI development, with demand outstripping supply as companies race to deploy large-scale AI models. Nvidia’s GPUs remain the gold standard for AI training, and securing sufficient hardware is critical for cloud providers to maintain competitive AI offerings.
By partnering with IREN, Microsoft not only secures a massive supply of Nvidia GPUs but also taps into a specialized neocloud infrastructure optimized for AI workloads, which could offer performance advantages over traditional data centers.
This deal also signals a shift in how the tech industry values hardware assets originally designed for cryptocurrency mining. Rather than being sidelined, these assets are increasingly integrated into mainstream AI infrastructure, blending blockchain and AI technology domains in new ways.
