Microsoft Corp. has finalized a five-year contract worth $9.7 billion with Australia-based IREN to secure substantial artificial intelligence (AI) cloud capacity, the companies announced Monday. This agreement provides Microsoft with access to advanced compute infrastructure built around Nvidia’s GB300 GPUs. The deployment of these resources is scheduled in phases through 2026 at IREN’s Childress, Texas facility, which is designed to support 750 megawatts of operational capacity.
The transaction highlights Microsoft's ongoing strategy to bolster its compute resources amidst rising customer demand for AI services. To fulfill the terms of the contract, IREN is undertaking a separate procurement of GPUs and associated equipment from Dell Technologies, an investment valued at approximately $5.8 billion. These acquisitions are critical for establishing the high-performance computing environment required by the agreement.
This deal with IREN builds upon a series of recent initiatives by Microsoft aimed at expanding its AI capabilities. Last month, Microsoft officially launched its initial production cluster incorporating Nvidia’s GB300 NVL72 systems within its Azure cloud platform. The company has publicly stated these systems are specifically optimized for critical AI tasks, including reasoning models, agentic AI systems, and multi-modal generative AI applications. Furthermore, in October, Microsoft announced a separate significant infrastructure agreement with Nscale, involving the provisioning of approximately 200,000 Nvidia GB300 GPUs across four major data centers – three located in Europe and one in the United States.
IREN's operational trajectory saw the company transition from its initial focus on bitcoin mining to specializing in AI workloads, a strategic pivot driven by its substantial existing collection of GPUs. This shift has positioned the company to capitalize on the increasing need for AI-specialized compute power. Daniel Roberts, Chief Executive Officer of IREN, was quoted by Bloomberg as projecting that the Microsoft agreement is expected to utilize approximately 10% of IREN's total available capacity. Roberts also anticipated that the contract would generate approximately $1.94 billion in annualized revenue for IREN, reflecting the significant financial implications of the partnership.
The consistent investment by major technology firms like Microsoft into dedicated AI compute infrastructure underscores a broader industrial trend towards scaling capabilities to support advanced AI models and applications across various sectors.
