IREN has completed delivery of the first of four planned “Horizon” artificial intelligence cloud deployments to Microsoft Corporation, marking the first milestone of a five-year, $9.7 billion contract that underpins the former Bitcoin mining company's transition into AI infrastructure.

Horizon 1 is located at IREN's facility in Childress, Texas. The 50-megawatt site uses direct chip-level cooling and is equipped with Nvidia GB300 systems, the chipmaker's Blackwell Ultra generation of AI processors. It is the first of four facilities of this type that the company plans to complete by 2026; together, the four sites are expected to provide a total of 200 megawatts of capacity.

Nvidia has also awarded the facility its Exemplar Cloud Status, a designation reserved for cloud providers that meet Nvidia's performance and reliability standards for AI workloads.

“Delivering Horizon 1 underscores the power of our vertically integrated business model and our ability to deliver on complex AI infrastructure projects with speed and scale,” said Daniel Roberts, co-founder and co-CEO of IREN, in a statement.

Why Microsoft's acceptance matters

Completing the build was only half of the test. Under the terms of the agreement, Microsoft has five days to validate the installation of each GPU deployment against mutually accepted standards. Once the acceptance process is complete, the service period commences and IREN begins charging Microsoft on a monthly basis.

Billing is the key. IREN signed its cloud services agreement with Microsoft in November 2025, a contract expected to generate approximately $1.94 billion in annualized revenue once all four Horizon facilities are online. Under its terms, Microsoft is required to pay 20% of the total contract value upfront, spread across four tranches.

The contract extends Microsoft's build-out of AI compute beyond its own data centers, a push the company has funded with sharply higher capital spending — Microsoft said in January 2025 that it planned to invest about $80 billion in AI-enabled data centers during its fiscal 2025.

IREN's AI pivot puts $4 billion revenue target in sight

The scale of the shift is visible in IREN's accounts. The company listed on the Nasdaq in 2021 as a Bitcoin miner. In the first nine months of 2022, it generated $511.5 million in revenue from its mining business, against just $58.3 million from its AI Cloud service.

IREN is one of a number of listed Bitcoin miners redirecting sites originally built for mining toward AI and high-performance computing, a shift driven in part by long grid-connection queues for new power capacity, which make miners' existing electricity infrastructure attractive to AI tenants.

According to management, IREN plans to reach annualized run-rate AI Cloud revenue in excess of $4 billion by the end of the year, with more than 85% of revenue contracted.

The timeline also reflects the health of the company's core business operations. In mid-August, the price of Bitcoin hovered around $63,500, less than half of its October 2025 peak. IREN has said it plans to reach 480 megawatts of AI cloud computing capacity in 2026 and 1.2 gigawatts in 2027 while moving out of mining operations.

The expansion is estimated to require about $5.8 billion in GPUs and related hardware purchased from Dell. IREN has secured funding for all but a minority of this expansion. That includes $3.65 billion of secured debt arranged in June and guaranteed by the Microsoft deal, according to The Block — enough to cover 96% of the $5.81 billion in GPU spending. The debt was rated investment grade A by Fitch and A (low) by DBRS.