IREN Limited announced record profitability for its first quarter of fiscal year 2026, reporting net income of $384.6 million and adjusted EBITDA of $91.7 million—an impressive turnaround from the $51.7 million loss posted in Q1 FY25. Revenue reached $240.3 million, up 355 % year‑over‑year and exceeding consensus estimates of roughly $228–$237 million, giving the company a revenue beat of about $3–$12 million.
The revenue surge was driven almost entirely by Bitcoin mining, which contributed $232.9 million, and a modest $7.3 million from AI Cloud Services. Compared with Q1 FY25 revenue of $52.8 million, the jump reflects both a 4‑fold increase in mining income and a 1.5‑fold rise in AI Cloud revenue, underscoring the company’s successful transition from a pure mining operation to a hybrid model that leverages its data‑center assets for high‑margin AI workloads.
Margins expanded as the company’s cost structure shifted toward higher‑margin AI services. Adjusted EBITDA rose from $2.5 million in Q1 FY25 to $91.7 million in Q1 FY26, a 36‑fold increase, while the EBITDA margin climbed to 38 % from 5 % the prior year. The improvement is largely attributable to the higher gross margin of AI Cloud contracts, disciplined capital spending, and the scaling of GPU capacity that reduces per‑unit cost.
Management reiterated confidence in the AI Cloud trajectory, citing a $3.4 billion annualized run‑rate revenue target by the end of 2026 and a planned expansion of the GPU fleet to 140,000 units. The landmark $9.7 billion Microsoft contract, expected to deliver an estimated 85 % EBITDA margin, is a key driver of the company’s long‑term growth strategy. The company’s cash balance of $1.8 billion provides a solid buffer for the capital‑intensive expansion.
Investor sentiment remained cautious despite the strong results. Market participants expressed concern over the significant capital outlay required to scale the AI Cloud platform, the rise in operating expenses—including depreciation and share‑based payments—and the concentration of revenue in a few large contracts. These factors tempered enthusiasm, even as the company’s fundamentals improved markedly.
Daniel Roberts, Co‑Founder and Co‑CEO, said the quarter “demonstrates disciplined execution and the rapid progress of our AI Cloud expansion.” He added that the 140,000‑unit GPU target represents only 16 % of the company’s 3 GW grid‑connected power portfolio, indicating ample capacity to sustain growth and deliver long‑term value.
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