IREN Ltd. 10-Q Summary: Quarter Ended December 31, 2025
Business Context and Reporting Period
This Quarterly Report on Form 10-Q covers the period ended December 31, 2025. IREN Ltd. operates as a vertically integrated provider of Bitcoin mining and AI Cloud Services. The company transitioned from IFRS to U.S. GAAP effective July 1, 2025, with comparative periods restated. As of the reporting date, the company reported approximately 46 EH/s of installed hashrate and 99,900 GPUs installed or on order for AI services.
Key Financial Metrics
| Metric | Three Months Ended Dec 31, 2025 | Six Months Ended Dec 31, 2025 |
|---|---|---|
| Total Revenue | $184.7 million | $425.0 million |
| Net Income (Loss) | $(155.4) million | $229.2 million |
| Adjusted EBITDA | $75.3 million | $167.0 million |
| Cash and Cash Equivalents | $3,260.6 million | $3,260.6 million (Ending Balance) |
| Convertible Notes Payable | $3,685.3 million | $3,685.3 million |
| Operating Cash Flow | N/A | $214.0 million |
Note: Net income for the six-month period includes a significant non-cash unrealized gain of $557.6 million on financial instruments.
Material Changes vs. Prior Period
- Revenue Growth: Total revenue increased 59% year-over-year for the quarter ($184.7M vs. $116.1M) and 152% for the six-month period ($425.0M vs. $168.9M). Bitcoin mining revenue grew due to higher average Bitcoin prices and increased hashrate (43.0 EH/s vs. 22.7 EH/s). AI Cloud Services revenue surged to $17.3M for the quarter from $2.7M.
- Operating Expenses: Selling, general, and administrative (SG&A) expenses rose significantly to $100.8M for the quarter (from $28.9M), driven primarily by a $50.3M increase in stock-based compensation and higher professional fees.
- Impairments: The company recorded $31.8M in asset impairments for the quarter, primarily related to S21 Pro miners being displaced to make way for AI Cloud Services expansion.
- Debt Restructuring: The company incurred a $111.8M debt conversion inducement expense related to the repurchase of portions of its 2029 and 2030 Convertible Notes.
Guidance, Outlook, and Risks
Strategic Outlook: IREN is aggressively pivoting toward High-Performance Computing (HPC) and AI. A landmark $9.7 billion agreement with Microsoft was signed on November 2, 2025, to provide dedicated GPU services over five years. To support this, the company entered a $5.8 billion hardware purchase agreement with Dell for GPU delivery in 2026.
Capital Markets: The company raised significant capital through the issuance of $1.0 billion in 2031 Convertible Notes and $2.3 billion in 2032/2033 Convertible Notes. It also completed a registered direct equity offering of approximately $1.6 billion.
Risks and Contingencies:
- Tariffs: The company is contesting a U.S. Customs assessment of a 25% tariff on mining hardware imports, estimated at approximately $100 million.
- Legal: A securities class action lawsuit remains pending, with a motion to dismiss currently under review.
- Regulatory: The company faces a dispute with the Canada Revenue Agency regarding a $27.1 million GST assessment related to intercompany services.
- Supply Chain: Risks include potential delays in GPU delivery and grid interconnection approvals, particularly in Texas (ERCOT).
Investor Verification Checklist
- Microsoft Agreement Execution: Verify the status of the $9.7B Microsoft contract, specifically the delivery acceptance process and the timeline for the first tranche of GPU services.
- GPU Financing: Confirm the closing of the $3.6 billion delayed draw financing commitment from Goldman Sachs and JPMorgan Chase to fund the Microsoft agreement.
- Tariff Resolution: Monitor the outcome of the U.S. Customs dispute regarding the 25% tariff on imported mining hardware.
- Capital Deployment: Track the drawdown of capital against the $8.8 billion in total commitments (hardware and infrastructure) disclosed as of December 31, 2025.
- Bitcoin Price Sensitivity: Assess the impact of Bitcoin price volatility on the core mining segment, which remains a primary revenue driver despite the AI pivot.