"While the NVIDIA contract and strategic partnership bolster Iren's clout as a neocloud provider, the circular nature and the undefined access to GPUs from NVIDIA tempers our view of the deal."
"The "circular" critique refers to a structure where NVIDIA commits capital to a customer that turns around and spends those dollars on NVIDIA hardware. The economic value can appear amplified because the same dollars effectively flow in both directions."
"IREN's gigawatt-scale buildout depends on receiving NVIDIA's most advanced chips in volume, and the contract reportedly doesn't lock in those allocations."
"The NVIDIA deal includes a $3.4 billion five-year AI cloud contract and a $2.1 billion NVIDIA share purchase option, alongside a broader 5-gigawatt strategic partnership."
JPMorgan Chase raised Iren’s price target to $46 from $39 but kept an Underweight rating. The change reflects skepticism about the structure of Iren’s major NVIDIA partnership. Iren is progressing in its shift to a full neocloud provider, and the NVIDIA contract supports its credibility in AI cloud services. However, JPMorgan cited a circular arrangement in which NVIDIA capital flows to a customer that then spends on NVIDIA hardware, potentially inflating apparent economics. JPMorgan also raised concerns that GPU access is not clearly defined, which matters because Iren’s gigawatt-scale buildout depends on receiving NVIDIA’s most advanced chips in volume. Iren is a vertically integrated data-center operator transitioning from Bitcoin mining to AI cloud services, with a $3.4 billion five-year AI cloud contract and a $2.1 billion NVIDIA share purchase option.
Read at 24/7 Wall St.
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