IREN part 2: why I stayed in 🧵
Last time, I wrote that I bought IREN $IREN during the dip as a speculative position (1% of my portfolio) and that I’d follow up with some proper research. It’s done, and subscribers got a 14-chapter analysis. Here’s the public version with the most important points.
What’s happening with the stock: Over the past 5 days, it has fallen roughly 26% to 27 USD. I didn’t expect it, but I wasn’t surprised. With this company, I expect the price to swing by tens of percent in either direction.
What I bought: I didn’t buy the story about 5 GW and a proprietary AI platform. I bought the signed contracts with Microsoft and NVIDIA. The market currently values the company at roughly three times their annual contracted revenue (ARR, meaning how much revenue the contracts bring the company each year). In my view, that price doesn’t even account for the company delivering on these contracts without a hitch. I see everything else as a bonus that I’m not paying for today.
Why SemiAnalysis’s criticism didn’t scare me: I take it seriously, but it mainly targets the older campuses in British Columbia. The Microsoft contract is being fulfilled in Childress, Texas, which SemiAnalysis itself rates significantly more favorably. In my view, the market punished the entire company for a problem affecting part of its capacity. I’m not factoring in the speculation about Anthropic at all.
What I’m worried about:
- Financing. The company is short billions for investment. I consider further dilution—issuing new shares that reduce existing shareholders’ ownership stakes—a certainty.
- Delivery. The first phase was delayed by three quarters. That’s why revenue per share, not revenue growth, will be what matters to me.
I’ll reconsider my position if results around November 5 don’t confirm the target of over 4 billion USD in ARR by year-end, if I don’t see AI revenue close to 1 billion USD per quarter in early 2027, or if customers start leaving the Canadian campuses.
Until then, I’m doing nothing and will watch how the company responds. You can find the full analysis, with valuation, scenarios, and figures, in the premium report. It’s still available at a 33% lifetime discount for another 9 days if you use this link: