IREN (NASDAQ: IREN) posted a mixed earnings report for the quarter ended September 30, 2026. Bitcoin mining revenue collapsed 58% to $28 million, while AI cloud revenue surged 182% to $200 million, driving total revenue to $228 million. The earnings release triggered a 16.95% drop in the company’s share price, closing at $18.03 on November 5.

BTC / USD
Source: CoinGecko. Prices are indicative.

Sharp decline in mining revenue

According to crypto.news, IREN’s mining income fell from $67 million in the June quarter to $28 million in September, and was down roughly 88% from the same quarter a year earlier when it earned $233 million. Bitcoin production dropped to 402 BTC from 2,039 BTC a year earlier, and the average hash rate fell from 45.3 EH/s to 8.8 EH/s as equipment was removed to make room for AI hardware. The company continues to sell mined Bitcoin daily and reported holding no BTC on its balance sheet at quarter‑end.

AI cloud drives revenue growth

The AI cloud segment accounted for about 88% of quarterly revenue, up from roughly 52% in June, according to the same source. AI cloud services contributed $135 million and cloud‑leasing added $65 million, with an 86% gross margin unchanged from the prior quarter. IREN’s co‑founder and co‑CEO Daniel Roberts said the Horizon 1 data center was deployed for Microsoft and that AI cloud revenue “nearly tripled to $200 million.” The company’s revenue backlog grew 22% to $20.3 billion, two‑thirds of which is tied to investment‑grade counterparties.

Timeline shift and capital needs

IREN indicated that the $4 billion annual recurring revenue (ARR) target, originally slated for December 2026, has been moved to January 2027 with a possible extension into February, largely due to Microsoft‑requested infrastructure changes. Management expects roughly $15 billion of capital expenditures in fiscal 2027, with $9 billion funded by cash, committed financing and customer pre‑payments, and the remaining $6 billion dependent on additional financing sources. The company also announced a five‑year contract worth about $22 million in annual revenue per megawatt, with the customer pre‑paying 90% of associated GPU spending.

What to watch next

Investors will monitor how quickly IREN can complete its transition away from Bitcoin mining while scaling AI infrastructure for Microsoft and other clients. The pace of capital deployment, the final ARR delivery date, and any further revisions to the mining exit timeline will be key indicators of the firm’s ability to sustain its revenue growth amid a shrinking mining footprint.