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ClassicButcher @vasilist on x 1097 followers
Created: 2025-07-20 16:52:26 UTC
Investment Analysis for Iris Energy Limited ( $IREN )
Ticker: $IREN
Current Stock Price: $XXXXX
Market Cap: ~$4B
Industry: AI Infrastructure and Bitcoin Mining
Date: July 20, 2025
Thesis Overview Iris Energy Limited ($IREN) operates renewable energy-powered data centers for Bitcoin mining and AI cloud services, positioning it as a dual-revenue player in high-growth sectors. With 3GW of energy capacity, $550M in recent funding, and a growing AI segment, IREN has strong potential but faces execution risks and crypto volatility. Compared to CoreWeave’s AI infrastructure success, IREN’s lower valuation offers upside, but conservative growth assumptions and competitive pressures temper expectations. This analysis projects realistic price targets for 2026, balancing opportunities with risks.
Financial Snapshot
- Q3 FY2025 (Ended March 31, 2025):
- Revenue: $148M (+176.1% YoY, record).
- Net Profit: $24M (+28% QoQ, second profitable quarter).
- Adjusted EBITDA: $83M (~56% margin).
- Operating Hashrate: XXXX EH/s (Bitcoin mining).
- Cash: $184.3M.
- June 2025 Update:
- Monthly Revenue: $68M (annualized ~$816M).
- Hardware Profit: $51M (75% margin, Bitcoin mining).
- Bitcoin Mined: XXX BTC.
- AI Cloud ARR: $28M (+6.06% MoM).
- Energy Capacity: 3GW, with Horizon X expansion planned.
- Funding: $550M convertible notes.
- Valuation:
- Market Cap: $4B.
- Forward Revenue Multiple: ~4.9x ($4B ÷ $816M).
- Shares Outstanding: ~241.9M.
- Analyst Sentiment:
- Consensus: Strong Buy.
- Average Price Target: $XXXXX (+6.8% upside).
Comparison to CoreWeave’s Growth CoreWeave’s Precedent:
- 2023 Revenue: $229M.
- 2024 Revenue: $1.92B (8.37x growth).
- Q1 2025 Metrics:
- Market Cap: $67B.
- TTM Revenue: $2.71B.
- Revenue Multiple: 24.7x.
- Annualized Revenue: ~$3.93B.
IREN’s Position:
- June 2025 Revenue Run Rate: $816M (3.56x CoreWeave’s 2023 revenue).
- Comparison: IREN is ahead of CoreWeave’s 2023 starting point but lags its 2024–2025 scale. Its 3GW capacity supports AI growth potential.
- Growth Potential: AI cloud ARR ($28M) is small but growing; Bitcoin mining provides stable cash flow.
Valuation Scenarios (2026 Price Targets) Scenario 1: Base Case (Moderate AI Growth, Stable Mining)
- Assumptions:
- Revenue grows 3x from $816M to $2.45B by 2026 (AI cloud ARR to ~$150M, mining doubles).
- Valuation multiple: 15x (below CoreWeave’s 24.7x).
- Calculation:
- Market Cap: $2.45B x XX = $36.75B.
- Upside: $36.75B ÷ $4B = 9.2x.
- Price Target: $155/share (+820%).
- Upper Limit: $170/share (+910%).
- Lower Limit: $124/share (+640%).
- Rationale: Balances AI expansion with mining stability, assumes realistic growth.
Scenario 2: Conservative Case (Capacity-Based Valuation)
- Assumptions:
- Valuation based on 3GW capacity at $9B ÷ 1.3GW x 3GW = $20.8B (CoreWeave’s $CORZ benchmark).
- Calculation:
- Market Cap: $20.8B.
- Upside: $20.8B ÷ $4B = 5.2x.
- Price Target: $87/share (+420%).
- Upper Limit: $100/share (+490%).
- Lower Limit: $74/share (+340%).
- Rationale: Anchors to tangible capacity, reducing reliance on revenue growth.
Strategic Positioning and Tailwinds
- AI Infrastructure: AI cloud ARR ($28M) growing at XXXX% MoM with ~2.4k NVIDIA Blackwell GPUs. Horizon X (50MW, Q4 2025) and Horizon X signal AI focus.
- Bitcoin Mining: XX EH/s capacity, $51M hardware profit (75% margin) at 3.0c/kWh. Funds AI capex.
- Sustainability: XXX% renewable energy reduces costs, attracts ESG-focused clients.
- Geographic Advantage: US/Canada focus (Childress, TX; Canal Flats, BC) avoids geopolitical risks.
- Recent Developments: $550M convertible notes; U.S. domestic issuer status (July 1, 2025).
….continues….Risks/Challenges/Conclusion
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XXXXXX engagements
Related Topics market cap ticker iris mining bitcoin mining coins ai $4b coins energy