The stock of IREN (IREN) is up 13% after the data centre operator announced a new deal with leading chipmaker Nvidia (NVDA).
Nvidia said that it will deploy five gigawatts of artificial intelligence (A.I.) infrastructure across IREN’s data centres.
Under terms of the deal, Nvidia has a five-year right to purchase 30 million IREN shares at $70 U.S. per share, a potential investment of $2.1 billion U.S.
At the same time, IREN will provide Nvidia with access to its cloud services worth $3.4 billion U.S. over the next five years.
Many analysts on Wall Street are critical of Nvidia’s investments in companies such as IREN that purchase or rent its hardware. However, the arrangement is a net positive for IREN.
Nvidia has been actively investing across its supply chain in recent months, taking stakes or options to invest in companies such as Corning (GLW) and Marvell Technology (MRVL).
IREN was previously an Australian Bitcoin (BTC) miner called Iris Energy before pivoting to A.I. computing and building out cloud computing infrastructure.
Today, IREN builds and operates renewable-powered A.I. data centres around the world.
The Nvidia deal is overshadowing disappointing earnings from IREN, which announced quarterly revenue of $144.8 million U.S., short of Wall Street’s estimate of $220.2 million U.S.
Prior to today (May 8), IREN stock had risen 725% over the past 12 months to trade at $56.85 U.S. per share.
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