Nvidia and IREN Limited have entered into a significant partnership, announcing a $3.4 billion cloud services agreement designed to deploy up to 5 gigawatts of advanced AI infrastructure utilizing Nvidia’s DSX architecture. This venture marks a notable escalation in the collaboration between tech giants and innovative computing providers.
As part of this comprehensive agreement, Nvidia has gained a five-year option to purchase up to 30 million shares of IREN at a price of $70 per share, translating to potential investment rights worth approximately $2.1 billion. This financial maneuver highlights Nvidia’s confidence in IREN’s operational capabilities and future growth.
The partnership will initiate infrastructure deployment at IREN’s 2-gigawatt Sweetwater campus situated in Texas. Under the terms of the deal, IREN will contribute $3.4 billion in managed GPU cloud services over five years, which will support Nvidia’s internal AI and research initiatives. Nvidia’s founder and CEO, Jensen Huang, emphasized the importance of AI infrastructure, stating, “AI factories are becoming foundational infrastructure for the global economy.” He further highlighted the necessity for deep integration across various technological layers—compute, networking, software, power, and operations—to effectively scale these systems.
IREN’s co-founder and co-CEO, Daniel Roberts, echoed these sentiments, noting that their collaboration fuses Nvidia’s leadership in AI architecture with IREN’s extensive expertise in infrastructure operations, power, and data center management. Concurrently, IREN is broadening its infrastructure to facilitate this expansive deployment. As part of its growth strategy, IREN has decided to acquire Ingenostrum, a Spain-based data center developer, contributing an additional 490 megawatts of grid-connected power and enhancing IREN’s total power portfolio to 5 gigawatts, aligning perfectly with the planned deployment for Nvidia.
After the announcement, IREN’s stock experienced a boost, surging above the $72 mark in after-hours trading, up from a closing price of $56.85. However, this momentum dissipated following IREN’s earnings report, which reflected a substantial net loss of $247.8 million for the first quarter. Despite this setback, IREN shares were up about 3%, trading at approximately $58.60. Investment bank Bernstein has set a price target of $100 for IREN shares based on the recent developments.
Nvidia’s stock has also been performing robustly, recently trading above $215 per share, with a remarkable 83% increase over the past year. IREN’s partnership with Nvidia continues the trend of significant corporate collaborations in the AI space, following its previous agreement with Microsoft worth $9.7 billion for GPU cloud infrastructure at its Texas data center. This deal included a $5.8 billion purchase agreement with Dell Technologies, consolidating IREN’s position as a formidable player in the AI infrastructure landscape.
The scale of IREN’s contracts, now exceeding $15 billion in commitments from partnerships with industry titans like Nvidia and Microsoft, underscores the growing competition for AI compute infrastructure. Noteworthy competitors, such as Hut 8, have also recently announced substantial agreements, securing a $9.8 billion AI data center lease, further intensifying the race among firms like Core Scientific and Terawulf as they pursue similar multi-billion-dollar deals with major AI players.
As the demand for dedicated compute capacity escalates, the role of infrastructure providers like IREN becomes increasingly critical in facilitating the next wave of technological development in artificial intelligence.
