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Scott Melker discusses the Bitcoin miner-turned-AI data center IREN (IREN) dropping 8.2% in after-hours trading on Thursday after reporting a $684 million loss in its fiscal 2026 results.
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Here you go. Iren shares fall 8% as costly AI transition weighs on earnings. Weakening profitability overshadowed a major milestone in Iren’s transformation into an AI cloud provider. So, I’ve told this story over and over and over again.
It started with Iren.
Bitcoin miners are becoming AI data centers.
It’s more profitable for them to become AI data centers. They’re already set up to do it and Bitcoin mining right now is not profitable at all. It’s a perfect storm for them to convert their business and make a lot more money.
So listen, at the top line, this looked really good. Iren’s AI cloud revenue more than doubled during the quarter to 70.5 million.
Their Bitcoin mining revenue was 66.7.
So AI now generates 51.4% of Iren’s quarterly revenue, the first time that we’ve seen it tilt in the direction of AI and we know that trend will continue until Bitcoin mining uh becomes a rounding error.
This is very clear evidence yet that Iren and the other miners I’ve told you about are exactly what I’ve said, which is AI data centers that may mine some Bitcoin when it makes sense.
So this seems like good news for Iren, right? Then why is the stock down? Well, total quarterly revenue fell 5% sequentially to 137.2 million.
Adjusted EBITDA dropped 68% and they recorded a 684-ian 84 million net loss.
Why? Because it’s really expensive to become an AI data center and make that transition.
Now, that will all clear out eventually, but it should be clear that as much of it se as it seems like this is an obvious and easy pivot for these companies to make,
it is not. It’s going to be expensive and it’s going to be difficult.
Either way, though, we can stop viewing Bitcoin miners as Bitcoin miners. It’s a misnomer. It’s not the case. They are AI data centers that will likely mine some Bitcoin.
Source: finance.yahoo.com