Microsoft seems to be expanding its data centers with a new multi-billion dollar deal. Reportedly, Microsoft has struck a $9.7 billion deal with data-center operator IREN that includes access to Nvidia’s advanced chips, aiming to ease the computing crunch that has kept the tech giant from fully cashing in on the artificial intelligence boom.
Under the agreement, Microsoft will use IREN’s data-center capacity—primarily located at its 750-megawatt Childress, Texas campus—to expand its AI cloud services without having to build all new facilities. Microsoft will make a 20% prepayment as part of the contract, while IREN will purchase about US $5.8 billion in GPUs and hardware from Dell Technologies to meet deployment needs.
The move is strategically important for Microsoft, which faces rising global demand for AI compute power to support tools like GitHub Copilot and Azure AI. For IREN, originally known for its bitcoin mining operations, the deal marks a transformative shift toward becoming a global AI infrastructure provider.
Reportedly, the news sent shares of IREN up more than 20% in premarket trading on Monday.
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Both companies benefit: Microsoft gains secure, high-performance computing capacity, while IREN gains stable, long-term revenue and industry validation. However, the deal carries execution and capital-intensity risks, as timely delivery of hardware and build-outs through 2026 will be crucial. IREN’s stock soared after the announcement, reflecting investor optimism that the agreement could be game-changing for the company and a key step in addressing the global GPU shortage.
Reportedly, IREN, which has a market value of $16.52 billion after a more than six-fold surge in its shares this year, has multiple data centers across North America with a total capacity of 2,910 megawatts. Its facilities are powered fully by renewable energy.
IREN Limited (NASDAQ: IREN) is an Australia-based technology infrastructure company that has transitioned from bitcoin mining to becoming a major AI cloud and data-center provider. Formerly known as Iris Energy, the company rebranded in 2024 to reflect its new focus on high-performance computing and artificial intelligence infrastructure.
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IREN operates large-scale, renewable-powered data centers in North America. Its Childress, Texas campus has secured 750 megawatts of grid-connected power, though only part of this capacity is currently operational; the site is being developed in phases through 2026 to meet growing AI demand.
The Microsoft–IREN deal highlights the growing importance of high-performance computing and AI infrastructure in today’s technology landscape. By leveraging IREN’s existing data-center capacity, Microsoft can rapidly scale its AI cloud services without building entirely new facilities, addressing the surging global demand for compute power. For IREN, the partnership represents a significant strategic transformation, moving from its roots in bitcoin mining to becoming a global AI infrastructure provider. Both companies stand to gain: Microsoft secures reliable, high-performance capacity, while IREN benefits from long-term revenue and increased industry credibility. However, the agreement is not without challenges, as timely hardware delivery and phased data-center build-outs through 2026 will be critical to realizing the deal’s full potential. Overall, the partnership underscores the critical role of renewable-powered, scalable data centers in supporting the AI boom and reflects a broader trend of collaboration between cloud providers and specialized infrastructure operators.