IREN Ltd. (NASDAQ:IREN) shares have lost about 18% from their Sept. 22 close, even as demand for the company’s AI computing capacity remains strong.
The concern is what that growth will cost. IREN plans $25 billion to $30 billion of fiscal 2027 capital spending, raising questions over financing and future returns.
AI Demand Isn’t the Problem
IREN said in August it had $4 billion of contracted annualized run-rate revenue (ARR) for 2026 capacity, including $1 billion already operating, with 2026 capacity largely sold out.
Management said recent three-year contracts were pricing above $20 million in revenue per megawatt of IT load.
IREN cautions that ARR is not a GAAP measure and recognized revenue may be materially lower.
The $30 Billion Question
Against a planned $25 billion to $30 billion of fiscal 2027 spending, IREN has about $14 billion of cash, committed GPU financing and customer prepayments. It is targeting another $8 billion from GPU financing and prepayments, with the remainder expected from data center financing, operating cash flow and other sources.
That does not mean IREN needs to raise $30 billion from shareholders. But it does mean the company still has to secure billions more in funding, build the capacity on time and generate enough revenue from it to justify the cost.
That has become more expensive as borrowing costs have risen. The U.S. 10-year Treasury yield touched 5.34% Thursday, its highest since 2002, increasing the cost of financing a buildout on this scale.
Bullish Analysts Still See Risks
Most of Wall Street still sees upside in IREN, with Benzinga data showing 17 of 21 analysts at Buy or better and no Sell ratings.
But Rothschild Redburn initiated IREN at Neutral with a $40 target, while Jones Trading started at Hold, citing customer credit quality.
Those concerns landed as investors were already reassessing the economics of AI infrastructure. IREN fell sharply Sept. 25 alongside other cloud-computing providers after Nscale’s IPO filing put fresh attention on the sector’s huge capital requirements and the durability of GPU pricing.
Prediction Traders Watch GPU Prices
H100 rental prices are also under pressure. The Ornn H100 index fell 11.1% over seven days to $2.71 per GPU-hour on Sept. 30.
Prediction traders are not betting heavily on a rebound. Polymarket puts about 22% odds on H100 rental prices finishing 2026 between $2 and $2.50 per hour, with roughly 65% of the market’s probability below $3. About $61,000 has been traded.
The market does not track IREN’s contracts directly, but falling H100 prices add to questions over returns on new AI capacity.
IREN shares were down about 2% at $40.80 at last check Thursday.
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