IREN (IREN $25.43 +2.11%) reports Q1 FY27 results on November 5, 2026. IREN's fiscal year ends June 30, so the report covers July to September 2026, the first quarter in which Microsoft's Horizon 1 cluster earned revenue. The stock goes into the print at $24.91, down 39.1% since September 30 and 67.4% below its closing high of $76.41 a year earlier, after a sell-off that hit every company borrowing to build GPU clouds.
We rebuilt the quarter from the run-rate figures management gave on the August 27 call. Our answer: Q1 revenue should beat consensus, because the company said its operating ARR doubled to $1 billion in mid-August and would stay there through September, while the Bitcoin mining business it is winding down still earned money at a better hashprice. The December quarter looks closer to consensus, since most new capacity arrives late in the quarter. The real debate is no longer revenue. It is how IREN pays for a $25 to $30 billion capital plan without selling much more stock at today's price.
The data behind this piece
Explore the primary data Equibles carries for IREN:
Why Q1 should beat consensus
IREN's revenue fell for three straight quarters as it switched off Bitcoin miners to make room for GPUs. The June quarter was the low point at $137.2M. The September quarter is where the AI Cloud ramp should overtake the mining decline, and management gave unusually precise inputs to model it.
On the August 27 call, CFO Anthony Lewis said IREN "exited Q4 at roughly half a billion of ARR", that ARR was "$1 billion today following acceptance of Horizon 1 by Microsoft", and that it "will carry through to the end of the September quarter". The Microsoft contract is worth $9.7 billion over five years, about $1.94 billion a year across four identical 50 MW deployments, so each Horizon carries about $485M of ARR. IREN announced on August 13 that Microsoft had accepted Horizon 1.
That gives a simple calculation:
- Existing capacity: $0.5 billion of ARR for all 92 days of the quarter is $126.0M.
- Horizon 1: $485M of ARR for the 49 days from August 13 to September 30 is $65.1M.
- AI Cloud total: $191.1M, up from $70.5M in the June quarter.
Consensus of $221.3M leaves about $172M for AI Cloud if mining comes in near our estimate, which implies either a later start for Horizon 1 or existing GPUs earning well below their run-rate. Neither is what management described.
Bitcoin mining: shrinking, but at a better price
IREN no longer publishes monthly mining updates, so we estimated the fleet from public Bitcoin network data. Dividing each quarter's mining revenue by the network's revenue per unit of hashrate gives the effective hashrate IREN earned on:
- Q3 FY26 (January to March): $111.2M at an average hashprice of $36.1 per PH/s per day, about 34.3 EH/s.
- Q4 FY26 (April to June): $66.7M at $35.7, about 20.6 EH/s.
- Q1 FY27 (July to September): the hashprice averaged $38.1, up 6.9%, because the network's hashrate fell from 956 to 918 EH/s while the Bitcoin price held near $71,000.
The 10-K puts installed mining capacity at 23.2 EH/s on June 30, and the CFO expects mining "to be effectively decommissioned by the end of December 2026". We assume about 80% of the installed fleet was earning on July 1 (18.6 EH/s) and that it falls in a straight line to zero by December 31. That averages 13.9 EH/s in the September quarter and $48.8M of revenue. Each 1 EH/s of average hashrate is worth about $3.5M of quarterly revenue at Q1's hashprice.
Our forecast for Q1 and Q2 FY27
| $M | Q1 FY27F | Consensus | Q2 FY27F | Consensus |
|---|---|---|---|---|
| AI Cloud, existing ~$0.5B ARR | 126.0 | 126.0 | ||
| AI Cloud, Horizon 1 | 65.1 | 122.2 | ||
| AI Cloud, Horizons 2 to 4 | 86.4 | |||
| AI Cloud, other new capacity | 51.3 | |||
| Bitcoin mining | 48.8 | 18.0 | ||
| Total revenue | 239.9 | 221.3 | 403.9 | 392.0 |
| Difference from consensus | +8.4% | +3.0% | ||
| Analyst range | 200.0 to 244.6 | 217.1 to 464.8 | ||
| Adjusted EBITDA | 69.0 | 198.4 | ||
| Adjusted EBITDA margin | 28.8% | 49.1% |
The Q2 forecast is a timing exercise. Management expects "more than $4 billion of ARR by the end of the December quarter", including Horizons 2 to 4, and the remaining three Horizons were scheduled for delivery in the calendar fourth quarter, as Goldman Sachs analyst Mike Ng summarized at the company's September 9 fireside chat. We assume Horizon 2 starts on December 1, Horizons 3 and 4 on December 15, and the other $1.56 billion of new ARR averages 12 days in the quarter. Mining falls to an average of 4.6 EH/s, and we use October's hashprice so far, $42.1 per PH/s per day.
Our downside cases show what it would take to miss:
- Q1 downside, $184.8M: existing GPUs earn only 90% of their run-rate, Horizon 1 revenue starts on September 1 rather than August 13, and mining averages 9 EH/s.
- Q1 upside, $254.3M: our AI Cloud base with mining averaging 18 EH/s, which would mean IREN kept most of its fleet running through September.
- Q2 late case, $381.0M: Horizon 2 starts on December 15 and the other new capacity on December 20, which is roughly what "late in the quarter" could mean.
For the full fiscal year, $4 billion of ARR through the March quarter is about $986M, and a June quarter averaging $4.5 billion as the first 2027 deployments arrive is about $1,122M. That puts FY27 revenue at about $2.75B, 2.0% below the $2.81B consensus (17 analysts, range $2.52B to $3.28B). The second half depends on 2027 deliveries that we cannot date yet, so we hold no strong view on the full year.
The driver: contracted ARR, priced above $20M per megawatt
IREN's pitch is that it owns everything from the grid connection to the GPU, and that this lets it sign multi-year contracts at high prices. In the FY26 results, the company said recent three-year contracts priced above $20M of annual revenue per megawatt of IT load, with current discussions near $25M. On the call, co-CEO Daniel Roberts stressed that these are "three to five-year deals, not two years, not spot capacity".
The $4 billion of December ARR breaks down roughly as follows, based on the company's own footnotes from May and July:
- Microsoft: about $1.94 billion a year from Horizons 1 to 4 at Childress, Texas.
- Existing British Columbia capacity: about $0.5 billion, already operating.
- New contracts: the rest, including $2.8 billion of total contract value signed in July with a weighted average term of about four years.
A further $0.7 billion a year from an NVIDIA contract ramps in 2027. Microsoft alone will be close to half of December ARR, so the concentration is high until the 2027 capacity is sold.
IREN also closed the Mirantis acquisition on August 4 for about 12.6M shares plus about $40M of cash. Mirantis sells cloud infrastructure software, and management says it opens up customers who want managed services rather than bare GPUs. IREN has not disclosed Mirantis revenue, so we leave it out of the forecast. It is a small upside to Q1 revenue and part of the higher SG&A.
Margins: the SG&A step-up is already in our numbers
Adjusted EBITDA fell to $19.2M in the June quarter, a 14.0% margin, as mining revenue shrank and cash SG&A rose to $85.4M (reported SG&A of $128.3M less $42.9M of stock-based compensation). The CFO guided to a further $40M to $50M increase in Q1 cash SG&A. We use $45M.
The AI Cloud business carries low direct costs. Its cost of revenue, excluding depreciation, was 13.0% of segment revenue in the June quarter, mostly power. We apply the same ratio to Q1 and scale mining costs with the hashrate. The result is $69.0M of adjusted EBITDA, a 28.8% margin, and about $198M (49.1%) in Q2 if cash SG&A rises another $20M.
GAAP earnings are a different story. Depreciation was $112.1M in the June quarter before most of the Horizon GPUs went into service, and the June quarter also carried $450.4M of impairments and a $102.1M fair value loss on mining hardware held for sale. The two analysts with Q1 estimates expect a loss of $0.665 per share, and the full-year FY27 EPS consensus has dropped to a loss of $3.42 from a loss of $0.94 sixty days earlier (four analysts). We do not forecast EPS, because non-cash items will decide it.
Balance sheet and dilution
IREN had $7.6 billion of cash on June 30, including $1.7 billion of restricted cash. In the June quarter alone it raised $3.0 billion of convertible notes and $2.1 billion from share sales, and customer prepayments pushed operating cash flow to $1.8 billion. Deferred revenue stood at $1.84 billion and remaining performance obligations at $5.1 billion.
The problem is the size of the plan. The CFO put FY27 capital expenditure at $25 to $30 billion, covering the 2026 deployments behind the $4 billion ARR target, the air-cooled 2027 capacity and much of the liquid-cooled 2027 data centers. Against that, he counted about $14 billion as secured (cash, committed financing and prepayments) plus an estimated $8 billion of additional GPU-related financing. That still leaves $3 billion to $8 billion to find.
The cost of debt is rising too. The $3.6 billion investment-grade financing for the Microsoft GPUs costs 6.0%, while the $2.4 billion facility led by Blue Owl and PIMCO for the air-cooled expansion at Mackenzie, British Columbia, costs 9.0%.
Equity has filled the gap so far. Shares outstanding rose from about 283.5M in October 2025 to 394.1M on August 14, 2026, a 39.0% increase. IREN had sold 47.2M shares for about $2.5 billion under its $6.0 billion at-the-market program by August 14. The remaining $3.5 billion would be about 141M new shares at the current price, another 35.7%. Any update on the share count, and on data center financing that would reduce the need for equity, matters more for the stock than the size of the Q1 beat.
What management said
“We exited Q4 at roughly half a billion of ARR. It's $1 billion today following acceptance of Horizon 1 by Microsoft, and that will carry through to the end of the September quarter.”
Anthony Lewis, CFO, Q4 FY26 earnings call
“And we expect more than $4 billion of ARR by the end of the December quarter, which is already under contract and includes delivery of Horizons 2 through 4. A significant amount of the December capacity is expected to come on late in the quarter, so we will see the reported revenue effect come through predominantly in the March quarter.”
Anthony Lewis, CFO, Q4 FY26 earnings call
“We currently expect mining operations to be effectively decommissioned by the end of December 2026.”
Anthony Lewis, CFO, Q4 FY26 earnings call
“We expect first quarter cash SG&A to increase approximately $40 million to $50 million sequentially as we continue to invest for growth across sales and marketing, R&D, development, sites and cloud operations, and other functions ahead of significant revenue growth over the coming periods.”
Anthony Lewis, CFO, Q4 FY26 earnings call
“2026 is largely sold out with the $4 billion of ARR now contracted.”
Daniel Roberts, co-CEO, Q4 FY26 earnings call
“Our contracts are paying back this compute investment in around two years with customers prepaying half the CapEx up front.”
Daniel Roberts, co-CEO, Q4 FY26 earnings call
“I think the next 12 to 18 months, this industry is going to be defined by execution and delays.”
Daniel Roberts, co-CEO, Goldman Sachs Communacopia and Technology Conference, September 9, 2026
Call quotes come from a speech-to-text transcript; the Q4 FY26 earnings call and the September 9 fireside chat are on Equibles.
How the market is positioned
The October sell-off was not about IREN alone. From the September 30 close to October 23, IREN fell 39.1%, CoreWeave (CRWV $55.19 +1.76%) 37.7%, Nebius (NBIS $153.27 -3.45%) 32.7%, Cipher Digital (CIFR $7.71 -2.90%) 49.8% and TeraWulf (WULF $11.98 +5.83%) 23.5%. These companies all fund GPU and data center construction with debt and new shares, and they fell together as investors questioned the cost of that funding.
- Short interest: 81.7M shares on September 30, about 20.7% of the shares outstanding in August, down from a peak of 98.2M on July 31. Days to cover was 2.3. The October 15 figure, due in late October, will show whether shorts added during the sell-off.
- Institutions: 681 institutions reported 270.0M IREN shares on their June 30 13F filings, up from 505 holding 166.8M shares at March 31. Part of the increase reflects new shares.
- Insiders: our Form 4 data shows no open-market purchases by IREN insiders since January 2025. The July 2026 filings were share awards and holding reports, which say little either way.
- Post-earnings moves: IREN released its last five results after the US close. The next-day moves were +14.9% (August 2025), -6.8% (November 2025), +5.1% (February 2026), +7.7% (May 2026) and -12.5% (August 2026), an average of 9.4% either way.
At $24.91, IREN's market value is about $9.8 billion on the August share count, about 3.5 times FY27 consensus revenue and 2.5 times the $4 billion of ARR it expects by December. The valuation looks low against contracted revenue, which is why the funding cost and the share count matter so much.
Our assumptions
| Assumption | Q1 FY27F | Q2 FY27F | Basis |
|---|---|---|---|
| Existing AI Cloud ARR ($B) | 0.5 | 0.5 | June exit, from the CFO |
| Horizon 1 ARR ($M) | 485 | 485 | $1.94B a year across four Horizons |
| Horizon 1 revenue days | 49 | 92 | Accepted August 13 |
| Horizons 2 to 4 start | Dec 1, Dec 15 | "Late in the quarter" | |
| Other new ARR ($B) | 1.56 | $4B target less Microsoft and existing | |
| Other new ARR, average days in quarter | 12 | Mostly December | |
| Average mining hashrate (EH/s) | 13.9 | 4.6 | 80% of 23.2 EH/s on July 1, straight line to zero by Dec 31 |
| Hashprice ($ per PH/s per day) | 38.1 | 42.1 | Network data; Q2 uses October to date |
| AI Cloud cost of revenue (% of segment revenue) | 13.0% | 13.0% | Q4 FY26 ratio |
| Mining cost per EH/s per quarter ($M) | 1.17 | 1.17 | Q4 FY26 cost over 20.6 EH/s |
| Cash SG&A increase ($M) | 45 | 20 | Guided $40M to $50M for Q1; Q2 is our estimate |
| Mirantis revenue | not modeled | not modeled | Not disclosed |
Risks to our call
- Revenue start dates. If Horizon 1 began billing later than its August 13 acceptance, or existing GPUs ran below full utilization, Q1 could land near our $184.8M downside.
- Mining shutdown pace. Every 1 EH/s of average hashrate is about $3.5M of quarterly revenue. A faster shutdown at Childress, to free power for GPUs, would cut into the beat.
- Delivery delays. Horizons 2 to 4 and the other December capacity drive Q2 and the March quarter. Roberts himself expects the industry to be "defined by execution and delays".
- Funding and dilution. A $3 billion to $8 billion gap after secured and expected financing, at a share price 67% below last year's high, could mean heavy dilution if debt markets stay tight.
- Customer concentration. Microsoft will be close to half of December ARR.
- Texas policy. An analyst asked on the August call about the Texas governor's directive on large data center loads. IREN's two Texas sites, Childress and Sweetwater, are central to its 2027 plan.
What to watch on the call
- AI Cloud revenue against our $191.1M, and whether ARR was still $1 billion on September 30.
- Delivery dates for Horizons 2 to 4, and whether the "more than $4 billion" December ARR target holds.
- Mining revenue and how many EH/s are still running.
- Cash SG&A against the $40M to $50M guide, and how much Mirantis contributed.
- Any data center financing, and how many shares IREN sold under its at-the-market program after August 14.
- An update to the $25 to $30 billion FY27 capex range and the funding plan behind it.
- Pricing on new contracts, against the $20M to $25M per megawatt range, and progress on contracting 2027 capacity.
Sources
- Q4 FY26 and FY26 results: 8-K filed August 27, 2026 (accession 0001878848-26-000051)
- Annual report for FY26, installed hashrate, share count and at-the-market sales: 10-K filed August 27, 2026 (accession 0001878848-26-000052)
- Horizon 1 delivery and acceptance: 8-K filed August 13, 2026 (accession 0001140361-26-032638)
- Mirantis acquisition: 8-K filed August 4, 2026 (accession 0001140361-26-031053)
- New contracts and the raised ARR target: 8-K filed July 20, 2026 (accession 0001140361-26-028871)
- Q3 FY26 results and ARR footnotes: 8-K filed May 8, 2026 (accession 0001878848-26-000025)
- Q2 FY26 results: 8-K filed February 5, 2026 (accession 0001878848-26-000014)
- Q1 FY26 results: 8-K filed November 6, 2025 (accession 0001878848-25-000079)
- Q4 FY26 earnings call, August 27, 2026, and the Goldman Sachs fireside chat, September 9, 2026: Equibles transcripts
- Bitcoin network hashrate, miner revenue and price: public Bitcoin network data
- Share prices, analyst consensus, short interest, 13F holdings and insider trades: Equibles
- Forecast and assumptions: Equibles Research model, October 26, 2026
This article is our analysis of public filings and our own financial model. It is not investment advice, and forecasts can be wrong. Equibles staff may hold positions in the securities discussed.