Neocloud IREN disclosed in its earnings report that more than $4 billion in annual recurring revenue initially expected during this year has been deferred to at least January, with potential extension into February. The company attributed the delay to a customer request for infrastructure modifications and supplier scheduling considerations. During the earnings call, co-CEO Daniel Roberts identified Microsoft as the customer, explaining that the request involved reconfiguring and upgrading network infrastructure to enable 200 megawatts of capacity to support next-generation frontier AI models.
The revenue delay announcement came after IREN’s stock experienced significant volatility, having fallen 26% following recent elections and declining 55% over the previous month. Despite the headwinds, shares rose in extended trading following the earnings report. The company reported quarterly revenue of $228 million, surpassing the average analyst estimate of $221 million. AI Cloud revenue more than doubled to $200 million, while the remainder came from bitcoin mining operations. Net losses narrowed substantially to $263 million compared to $684 million in the prior quarter.
The company operates within a sector facing increased scrutiny as the AI trade shows signs of contraction. Investor concerns center on whether cash-intensive companies reliant on debt financing can meet obligations amid rising interest rates and tightening lending conditions. Roberts acknowledged the shift in market sentiment, noting that capital markets have become more selective and questions have shifted from contract size to deliverability, financing viability, and profitability.
IREN reported a revenue backlog that increased 22% from the prior period to $20.3 billion, with approximately two-thirds representing investment-grade counterparties. The company stated the $4 billion delayed revenue is fully contracted and funded. The firm plans $15 billion in capital expenditures for the remainder of the fiscal year, comprising $9 billion in cash and committed financing plus $6 billion in target financing subject to market conditions. IREN maintains contracts with Nvidia, Microsoft, and 13 additional customers, and noted that compute pricing continues to rise.
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