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Bitcoin miner IREN is shifting toward AI cloud infrastructure, leveraging a Microsoft deal and a major GPU expansion, and analysts expect its Bitcoin mining revenue to decline over time as power capacity is redirected toward contracted AI computing.
In a research report, Bernstein said IREN could become a leading Bitcoin miner to transition into AI infrastructure after its multi-billion-dollar agreement with Microsoft, reflecting a broader change in mining economics.
Bernstein highlighted IREN’s rapidly expanding AI cloud division, where around 150,000 GPUs are already contracted. Once fully operational, the division is estimated to support an annual revenue run rate of $3.7 billion.
A significant share of the capacity is tied to a long-term agreement with Microsoft, under which Microsoft has committed to using GPU capacity for AI workloads over five years. The deal also includes substantial customer prepayments, which help fund the infrastructure buildout.
Bernstein said IREN’s GPU investment totals roughly $5.8 billion. The buildout is largely funded through Microsoft customer prepayments and GPU-backed financing facilities, along with additional cash and capital sources, which the analysts said helps keep borrowing costs relatively low.
Bernstein expects the transition to reshape IREN’s business model. The analysts wrote that IREN “will eventually sunset the Bitcoin mining business as it retrofits existing sites to accelerate cloud deployment.”
Rather than shutting down operations outright, IREN is repurposing existing mining infrastructure—particularly in Texas and British Columbia—by replacing ASIC mining rigs with GPUs designed for AI workloads.
Bernstein expects AI cloud revenue to become IREN’s primary source of income in the coming years. The report also frames Bitcoin mining as gradually fading into a legacy segment, with mining revenue declining over time as power capacity is redirected toward higher-margin, contracted AI computing.
IREN is not alone in pursuing this pivot. Bernstein noted that other mining companies, including TeraWulf and HIVE Digital, have begun reallocating power and capital toward AI and high-performance computing, often alongside their existing Bitcoin mining operations.
Bernstein assigned IREN stock a $100 price target, citing significant upside as the company shifts away from Bitcoin mining and toward AI infrastructure. With the stock trading below $50, the target implies nearly 100% upside from current levels.
The analysts maintained an Outperform rating, even after reducing their previous $125 target, reflecting a more conservative view on dilution and the gradual wind-down of Bitcoin mining.
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