Microsoft Secures $9.7 Billion AI Cloud Deal with IREN
Microsoft signs a $9.7 billion AI cloud deal with IREN, transitioning from Bitcoin mining to AI infrastructure, highlighting neocloud trends.
Microsoft and IREN’s $9.7 Billion AI Cloud Deal: A New Era in High-Performance Computing
Microsoft has signed a landmark $9.7 billion, five-year agreement with IREN Limited—a company originally founded as a Bitcoin miner—to secure AI cloud capacity, marking one of the largest commercial deals in the rapidly evolving neocloud sector. The deal, announced in early November 2025, grants Microsoft access to cutting-edge NVIDIA GB300 GPUs hosted at IREN’s 750-megawatt data center campus in Childress, Texas, as the tech giant rushes to meet surging demand for artificial intelligence infrastructure. The scale and structure of the agreement—including a 20% upfront prepayment—underscore Microsoft’s confidence in IREN’s ability to deliver at hyperscale, while also validating the strategic pivot of former crypto miners into the AI infrastructure space.
Background: From Bitcoin Mining to AI Cloud Powerhouse
IREN, formerly known for its large-scale Bitcoin mining operations, has successfully transitioned into a leading provider of AI cloud services, joining a growing cohort of firms repurposing energy-intensive data centers for high-performance computing (HPC) workloads. The company’s roots in cryptocurrency mining equipped it with deep expertise in managing massive, power-hungry server farms—a skillset now in high demand as the AI boom strains global GPU supply chains.
To fulfill its Microsoft contract, IREN will acquire $5.8 billion worth of NVIDIA GB300 GPUs and supporting equipment from Dell Technologies, with deployment planned in phases through 2026. The new infrastructure will be housed in state-of-the-art, liquid-cooled data centers at IREN’s Texas campus, supporting up to 200 megawatts of critical IT load under the “Horizon 1–4” expansion. This vertical integration—from hardware procurement to energy management and cloud delivery—positions IREN as a unique player in the hyperscale AI infrastructure market.
Deal Mechanics and Financial Impact
The $9.7 billion contract is structured as a multi-year GPU cloud services agreement, with Microsoft receiving priority access to IREN’s NVIDIA GB300-based AI systems. The 20% prepayment—nearly $2 billion—provides IREN with immediate capital to accelerate its buildout, while also signaling Microsoft’s long-term commitment to the partnership. IREN expects to generate approximately $1.9 billion in annual revenue from the deal, a transformational sum for a company that was, until recently, best known for cryptocurrency mining.
IREN plans to finance the associated capital expenditures through a mix of existing cash reserves, customer prepayments, operating cash flows, and additional financing initiatives. The announcement triggered a 30% surge in IREN’s share price during premarket trading, extending a remarkable 500% rally over the past year as investors bet on the company’s AI-driven future.
Strategic Implications for the AI and Cloud Industries
The Microsoft-IREN partnership is more than a bilateral contract—it is a bellwether for the broader technology and energy sectors. Key implications include:
- GPU Supply Chain Innovation: By partnering with a former Bitcoin miner, Microsoft is tapping into a new source of GPU capacity at a time when shortages are constraining AI innovation across the industry. This deal highlights the strategic value of miners’ existing infrastructure and expertise in scaling energy-intensive compute workloads.
- Neocloud Emergence: The agreement validates the “neocloud” model—a new class of data center operators that have pivoted from cryptocurrency to AI infrastructure. Companies like IREN, CoreWeave, and Crusoe are now critical partners for hyperscalers seeking to expand their AI capabilities rapidly.
- Energy and Sustainability: IREN’s Texas campus, with its 750MW capacity, underscores the importance of scalable, reliable, and (increasingly) sustainable energy sources for next-generation computing. Liquid cooling and energy-efficient designs are becoming table stakes for AI data centers, and IREN’s buildout reflects this trend.
- Financial Windfall for Founders: The deal has reportedly catapulted IREN’s founders—former investment bankers—into the ranks of the ultra-wealthy, with their combined net worth now estimated at $850 million, according to Bloomberg. This financial outcome underscores the lucrative opportunities created by the AI infrastructure gold rush.
Context and Industry Impact
The Microsoft-IREN deal arrives amid unprecedented demand for AI compute, driven by the proliferation of large language models, generative AI applications, and enterprise adoption of machine learning at scale. Hyperscalers like Microsoft, Amazon, and Google are racing to lock up GPU capacity, often through unconventional partnerships and creative financing structures.
For IREN, the contract represents a decisive pivot from its origins in cryptocurrency mining to a central role in the global AI ecosystem. Daniel Roberts, Co-Founder & Co-CEO of IREN, stated: “We’re proud to announce this milestone partnership with Microsoft, highlighting the strength and scalability of our vertically integrated AI Cloud platform. This agreement not only validates IREN’s position as a trusted provider of AI Cloud services, but also opens access to a new customer segment among global hyperscalers.”
For Microsoft, the deal is a strategic move to ensure it can meet the explosive growth of Azure AI services, while also hedging against GPU supply constraints that have plagued the industry. By securing access to IREN’s infrastructure, Microsoft gains a competitive edge in the race to deploy AI at scale.
Visual Storytelling
While specific images of the “ex-banker brothers” or their $850 million windfall are not widely published in official channels, the following visuals would be directly relevant to this story:
- IREN’s Childress, Texas Data Center Campus: Official photos or renders of the 750MW facility, emphasizing its scale and liquid-cooled infrastructure.
- NVIDIA GB300 GPUs: High-resolution product images or data center installation shots, showcasing the hardware at the heart of the deal.
- Microsoft Azure AI Branding: Screenshots or promotional materials highlighting Azure’s AI services and compute offerings.
- IREN and Microsoft Logos: Official logos used in joint announcements or press releases.
- Founders’ Profiles: Professional headshots of IREN’s co-founders, if available from corporate websites or financial news outlets.
These images would provide readers with a concrete sense of the scale, technology, and key players involved in this transformative deal.
Conclusion
The $9.7 billion Microsoft-IREN AI cloud agreement is a watershed moment for both companies and the broader technology industry. It demonstrates how former Bitcoin miners are reinventing themselves as critical infrastructure providers for the AI era, while also revealing the lengths to which hyperscalers will go to secure scarce GPU resources. The deal’s financial impact—including a nearly $1 billion windfall for IREN’s founders—highlights the high stakes and rapid evolution of the AI infrastructure market. As demand for AI compute continues to surge, partnerships like this one will shape the competitive landscape for years to come.
