IREN delays part of its Microsoft AI capacity and plans $15 billion in spending

IREN, an Australia-based operator of AI data centers, said on November 5 that part of the capacity it is building for Microsoft will arrive later than planned. Alongside its results for the quarter ended September 30, the company also detailed a large spending plan for the rest of its fiscal year.

A target pushed into 2027

IREN had aimed to have more than $4 billion in annualized run-rate revenue operating by the end of 2026. Its earnings release now puts that milestone in January 2027, with a possible slip to February, citing a design change requested by a customer and the timing of suppliers. The company stresses that the program is fully contracted and funded, and that run-rate revenue is an operating metric rather than an accounting measure.

According to Reuters, the customer is Microsoft, which asked for changes to network design on the 200 megawatts IREN is building for it in Texas. IREN told Reuters it would face no financial penalties. The release says the first phase, Horizon 1, has been delivered to Microsoft, while Horizons 2 to 4 are in late-stage construction.

Results and spending plans

Revenue reached $228 million in the quarter, up from $137 million in the previous quarter, and slightly above the analyst average of about $221 million compiled by LSEG, Reuters reports. AI cloud revenue rose to $200 million from $71 million, while bitcoin mining revenue fell to $28 million. IREN still posted a net loss of $263 million.

The company plans $15 billion of capital spending over the remainder of its fiscal 2027. It says $9 billion is covered by cash, committed GPU financing and customer prepayments, and that it aims to raise the remaining $6 billion through further GPU and data-center financing, prepayments and other sources, subject to market conditions. IREN reports a revenue backlog of $20.3 billion, about two-thirds of it with investment-grade counterparties, and net debt of roughly $4.4 billion.

Market context

The announcement came during a difficult session for so-called neoclouds. Reuters reports that IREN shares closed down about 17% amid a broader sell-off in chipmakers and AI infrastructure stocks, then gained around 4% after hours on the earnings beat. Reuters also cites a Bloomberg report that Microsoft is tightening oversight of neocloud projects run by IREN, Nebius and Nscale and focusing more on its own data centers. Microsoft has not commented in the sources reviewed here, so the scope of that shift remains unclear.