NVIDIA takes $2.1bn warrant in IREN as part of 5GW AI data-centre deal

"NVIDIA will invest up to $2.1bn in IREN as part of a deal that pairs the chipmaker's reference architecture with the data-centre operator's 5-gigawatt infrastructure pipeline. The two companies announced the partnership on Thursday. The structure is unusual. Rather than a straight equity round, IREN has issued Nvidia a five-year warrant for up to 30 million shares at an exercise price of $70."

"If Nvidia exercises in full, it would put the ticket size at $2.1bn at the strike, with cash outflow timed at the chipmaker's discretion rather than the deal-close date. Operationally, the Sweetwater campus in Texas, currently sized at 2GW of planned capacity, comes first. IREN signed a $9.7bn cloud agreement with Microsoft last year for capacity at the same site; the Nvidia tie-up extends the same playbook with the chipmaker as both partner and shareholder."

"The deal slots IREN into a category that has become a familiar Nvidia portfolio shape over the past eighteen months. The chipmaker has taken positions in CoreWeave, Nebius and several other so-called "neoclouds", the firms that buy Nvidia GPUs at scale and rent them back to hyperscalers and frontier-model builders. Nebius buying Eigen AI to maximise tokens per GPU was one of the most-watched plays in the same arc."

"The thesis is straightforward: AI demand outruns hyperscaler capacity faster than the hyperscalers can build, and Nvidia benefits twice if the gap is filled by neoclouds running its silicon. The numbers behind that thesis have grown larger each quarter. The four largest US tech companies have collectively guided to more than $700bn in 2026 capex, much of it earmarked for AI infrastructure. Even at that pace, model providers and emerging enterprise users keep landing on waitlists for capacity."

NVIDIA will invest up to $2.1 billion in IREN by pairing its reference architecture with IREN’s 5-gigawatt data-center infrastructure pipeline. The investment is structured through a five-year warrant for up to 30 million shares with a $70 exercise price, rather than a conventional equity round. If exercised in full, the cash outflow would occur at NVIDIA’s discretion. The first operational site is the Sweetwater campus in Texas, planned for 2GW capacity, where IREN already has a $9.7 billion cloud agreement with Microsoft. The partnership fits a broader pattern in which NVIDIA takes positions in neocloud operators that buy GPUs at scale and rent capacity to hyperscalers and AI model builders. AI infrastructure demand is outpacing hyperscaler buildouts, leaving providers on waitlists for capacity.

Read at TNW | Nvidia