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IREN Limited (NASDAQ: IREN) sent its shares surging more than 13% in after-hours trading on May 7, 2026 — closing the regular session at $56.85 before vaulting to approximately $64.43 in extended hours — after announcing a landmark strategic partnership with NVIDIA (NASDAQ: NVDA) that encompasses both a $3.4 billion cloud services contract and a potential $2.1 billion equity stake for the world's leading AI chipmaker. The dual announcement, released after market close alongside the company's Q3 FY26 results, positions IREN as one of the most heavily backed AI infrastructure operators globally.
- IREN and NVIDIA signed a five-year, $3.4 billion managed GPU cloud services contract covering NVIDIA's internal AI and research workloads.
- NVIDIA received a five-year right to purchase up to 30 million IREN shares at $70 each, representing a potential $2.1 billion equity investment.
- The strategic partnership targets deployment of up to 5 gigawatts of AI infrastructure, anchored by IREN's 2GW Sweetwater campus in Texas.
A Five-Year Managed GPU Cloud Contract at Scale
At the core of the announcement is a five-year AI cloud infrastructure services agreement under which IREN will provide NVIDIA with fully managed GPU cloud access for the chipmaker's internal AI training and research workloads. The contract, valued at approximately $3.4 billion over its duration, will be serviced using air-cooled Blackwell platform systems deployed within roughly 60 megawatts of IREN's existing data center capacity at its Childress, Texas campus. The arrangement also includes GPU cluster orchestration and cluster management software developed in collaboration with enterprise cloud software firm Mirantis.
Daniel Roberts, Co-Founder and Co-CEO of IREN, described the agreement as validation of the company's full-stack capabilities. "This contract demonstrates our ability to deliver fully managed cloud solutions, not just bare metal, to a broad and growing customer base," Roberts said. The deal marks a significant evolution for IREN, which has been aggressively pivoting from its origins as a bitcoin mining operator toward becoming a vertically integrated AI neocloud provider.
NVIDIA's $2.1 Billion Warrant Option Signals Deep Conviction
Beyond the cloud services contract, NVIDIA secured a five-year right to purchase up to 30 million ordinary IREN shares at an exercise price of $70 per share — a total potential equity commitment of $2.1 billion. The warrants underscore NVIDIA's strategic confidence in IREN's infrastructure build-out and cement a relationship that goes well beyond a standard customer-vendor dynamic.
Jensen Huang, Founder and CEO of NVIDIA, framed the partnership in sweeping terms. "AI factories are becoming foundational infrastructure for the global economy," Huang said. "Deploying these systems at scale requires deep integration across the full stack — compute, networking, software, power and operations. IREN brings the scale and infrastructure expertise to help accelerate the buildout of next-generation AI factories globally."
Sweetwater Campus and 5GW Expansion Ambitions
The partnership is engineered to scale well beyond the initial Childress deployment. Future buildout will focus on IREN's flagship 2-gigawatt Sweetwater campus in Texas, which NVIDIA and IREN expect to serve as the primary deployment site for NVIDIA's proprietary DSX AI factory architecture — a full-stack design combining compute, networking, power, and operational software. The combined pipeline targets up to 5 gigawatts of AI infrastructure capacity, a figure that dwarfs the capacity of most existing commercial data center operators.
The 5GW ambition places IREN in direct competition with hyperscale cloud operators and other neocloud providers, including CoreWeave (CRWV), as the race to secure long-term GPU compute capacity intensifies across the industry.
Analyst Community Upgrades Price Targets
The market reaction drew swift responses from the analyst community. HC Wainwright raised its price target on IREN to $85, while BTIG Research lifted its target to $80, with both firms citing the transformative nature of the NVIDIA relationship. IREN's 1-year consensus price target on CNN Markets stands at a median of $78.50, with a high-end analyst target reaching $107.
The company also reiterated its 2026 AI Cloud annual run-rate revenue (ARR) guidance of $3.7 billion by year-end — a figure that explicitly excludes revenue from the newly announced NVIDIA contract, suggesting the actual revenue trajectory heading into 2027 is materially higher than current consensus models reflect.
Building on a $9.7 Billion Microsoft Precedent
The NVIDIA deal follows IREN's November 2025 agreement with Microsoft (MSFT), a five-year GPU cloud infrastructure contract valued at $9.7 billion, also powered by NVIDIA GB300 GPUs. Together, the two contracts place IREN's contracted backlog well above $13 billion, establishing the company as one of the most strategically positioned independent AI data center operators in North America.
IREN's Q3 FY26 revenue came in at $184.69 million, below analyst consensus of $229.64 million — a shortfall attributed primarily to weaker Bitcoin prices weighing on its legacy mining segment. However, the market's emphatic response to the NVIDIA deal signaled that investors are firmly focused on IREN's rapidly growing AI cloud business rather than its transitioning digital assets operation.
2027 Capacity Expansion on Track
IREN confirmed that its 1.2 gigawatt AI cloud capacity build-out targeted for 2027 remains on schedule. The company is simultaneously expanding internationally, announcing a separate agreement to acquire Nostrum Group (Ingenostrum, S.L.), a next-generation data center operator, extending IREN's AI Cloud platform into Europe. These parallel moves reflect IREN's strategy to build a globally diversified, NVIDIA-aligned infrastructure network across North America, Europe, and the Asia-Pacific region.
With the NVIDIA partnership in place, a $13+ billion contracted revenue base, 5GW of infrastructure in the pipeline, and confirmed international expansion, IREN enters the second half of 2026 as one of the most closely watched names in the AI infrastructure buildout — a sector where Big Tech's combined AI capital expenditures are on course to surpass $700 billion in 2026 alone.
Mentioned Tickers: IREN, NVDA, MSFT, CRWV
