Microsoft inks $9.7B deal with Australia’s IREN for AI cloud capacity

In an effort to bolster its AI service capabilities, Microsoft has made a significant move by entering into a $9.7 billion agreement with Australia's IREN. This five-year contract, announced on Monday, aims to enhance Microsoft's cloud computing capacity to meet the growing demand for AI services. The partnership will provide Microsoft with access to advanced computing infrastructure featuring Nvidia's GB300 GPUs, which are set to be implemented in phases through 2026 at IREN's facility located in Childress, Texas. This facility is designed to support a robust 750 megawatts of capacity. In addition, IREN is investing approximately $5.8 billion to acquire additional GPUs and equipment from Dell as part of this expansive initiative. This agreement follows Microsoft's recent launch of its first production cluster utilizing Nvidia’s GB300 NVL72 systems for Azure, which have been optimized for various AI applications, including reasoning models and generative AI systems. Last month, the company also secured a contract with Nscale for around 200,000 Nvidia GB300 GPUs to supply three data centers in Europe and one in the United States. Originally starting as a bitcoin-mining operation, IREN has successfully pivoted towards utilizing its substantial GPU resources for AI workloads. This strategic shift has proven beneficial, with CEO Daniel Roberts estimating that the Microsoft partnership will account for only 10% of IREN's total capacity, potentially generating an impressive $1.94 billion in annual revenue, according to Bloomberg.