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Iris Energy (IREN)
NASDAQ:IREN
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Iris Energy
(NASDAQ:IREN)
Rating:63Neutral
Price Target:
$12.50
▲(5.31%Upside)
Positive Factors
Business Expansion
IREN is on track to significantly increase its self-mining capacity and complete its liquid-cooled AI data center.
Operational Efficiency
IREN is one of the strongest miners with low power costs and the most efficient mining fleet, resulting in impressive EBITDA margins.
Valuation
IREN is trading at a lower multiple compared to the projected FY2026 EBITDA, indicating potential undervaluation relative to future earnings.
Negative Factors
AI Data Center Contracts
There is no signed commercial partner contract yet for the Horizon 1 AI data center, which affects forecasted HPC revenues.
Cloud Services Performance
Cloud Services revenue was down modestly, below company guidance.
Revenue Forecasts
Revenue estimates for FY2025 and FY2026 have been adjusted downwards due to changes in estimated utilization and forecasts for BTC and global hash rates.
Iris Energy (IREN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.86B
Dividend YieldN/A
Average Volume (3M)17.64M
Price to Earnings (P/E)―
Beta (1Y)2.21
Revenue Growth130.86%
EPS Growth-22.83%
CountryUS
Employees144
SectorFinancial
Sector Strength80
IndustryFinancial - Capital Markets
Share Statistics
EPS (TTM)0.11
Shares Outstanding241,866,820
10 Day Avg. Volume20,421,494
30 Day Avg. Volume17,636,181
Financial Highlights & Ratios
PEG Ratio0.02
Price to Book (P/B)0.84
Price to Sales (P/S)0.00
P/FCF Ratio-2.32
Enterprise Value/Market Cap0.30
Enterprise Value/Revenue1.01
Enterprise Value/Gross Profit3.92
Enterprise Value/Ebitda7.20
Forecast
1Y Price Target
$17.96Price Target Upside51.31% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
Iris Energy Business Overview & Revenue Model
Company DescriptionIris Energy Limited (IREN) is a sustainable Bitcoin mining company that focuses on utilizing renewable energy sources to power its operations. The company is dedicated to minimizing its carbon footprint while engaging in the energy-intensive process of cryptocurrency mining. Iris Energy is involved in the technology and financial sectors, leveraging cutting-edge infrastructure to efficiently mine Bitcoin, which is its core product.
How the Company Makes MoneyIris Energy makes money primarily through the mining of Bitcoin, which involves solving complex mathematical problems to validate transactions on the Bitcoin network. The company earns revenue by receiving Bitcoin as a reward for successfully mining new blocks, as well as transaction fees associated with the validated transactions. A key factor in its revenue model is the cost-efficiency of its operations, achieved by using renewable energy sources, which helps reduce electricity costs, a major expense in Bitcoin mining. Additionally, Iris Energy may engage in partnerships with energy providers or technology firms to enhance its operational efficiency and sustainability. The value of the mined Bitcoin directly influences the company's earnings, as market conditions and Bitcoin prices fluctuate.
Iris Energy Earnings Call Summary
Earnings Call Date:May 14, 2025
(Q3-2025)
| % Change Since: 48.93%|
Next Earnings Date:Sep 10, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong operational and financial performance with record-breaking revenue and significant growth in Bitcoin mining and AI Cloud services. Despite increased electricity costs and a high net funding requirement, the company shows disciplined capital allocation and strategic focus on AI infrastructure, suggesting a positive outlook.Q3-2025 Updates
Positive Updates
Record-Breaking Revenue and Growth
Q3 FY2025 revenue reached a record $148 million, driven by growth in Bitcoin mining and AI Cloud segments. Net profit was $24 million, reflecting a 28% growth quarter-on-quarter.
Significant Bitcoin Mining Capacity Expansion
Achieved an average of 29.4 exahash of operating mining capacity, representing nearly a 5x uplift year-on-year. Plan to reach 50 exahash by June 30, marking a 4x increase from June last year.
Strong AI Cloud Performance
AI Cloud services saw 33% quarter-on-quarter revenue growth with 97% hardware profit margins. The GPU fleet is running at or near full utilization.
Efficient Capital Allocation and Strategic Pause
Decision to pause further Bitcoin mining expansion beyond 50 exahash to focus on AI infrastructure, reflecting disciplined capital allocation.
Advancement in AI Data Centers
Development of Horizon 1, a 50 megawatt liquid-cooled data center, targeting Q4 2025 delivery, designed for next-generation AI workloads.
Negative Updates
Increased Electricity Costs
Total net electricity cost increased by 30% from $28.9 million to $36.5 million due to increased megawatt usage at Childress.
Dependence on Market Conditions for Growth
Future growth in revenue and profitability is highly dependent on Bitcoin prices and network difficulty adjustments.
High Net Funding Requirement
Estimates of a net funding requirement of up to $250 million over the remainder of 2025, primarily for expansion projects.
Company Guidance
In the Q3 FY2025 results conference call, IREN reported significant financial and operational growth metrics, marking their second consecutive quarter of profitability with a net profit of $24 million, reflecting a 28% quarter-on-quarter growth. Revenue reached a record $148 million, driven by both Bitcoin mining and AI Cloud segments, while EBITDA was nearly $83 million, also a record. The company achieved an average operating mining capacity of 29.4 exahash, a nearly fivefold increase year-on-year. IREN anticipates reaching 50 exahash of installed capacity by June 30, representing a fourfold increase from June last year. The AI Cloud segment saw 33% quarter-on-quarter revenue growth, with hardware margins exceeding 95%. Additionally, IREN plans significant AI infrastructure expansions, including the development of a 50-megawatt liquid-cooled data center by Q4 2025 and a 2-gigawatt data center hub in Texas by April 2026.Iris Energy Financial Statement Overview
Summary
Iris Energy shows strong revenue growth and maintains a robust equity base with low leverage. However, challenges persist with negative profitability and cash flow, necessitating improved capital management and net income for sustainable growth.Income Statement
Iris Energy shows significant revenue growth from $2.17M in 2020 to $282.69M in TTM (Trailing-Twelve-Months) 2024, indicating strong top-line expansion. However, the company faces challenges with profitability, as evidenced by a negative EBIT and net income margins. The gross profit margin remains robust at 77.07% TTM, but high operating expenses are impacting net profitability.45
Neutral
Balance Sheet
The company maintains a solid equity base, with a high equity ratio of 69.45% in TTM 2024, indicating financial stability. The debt-to-equity ratio of 0.25 suggests a conservative use of leverage. However, the company needs to address its net losses to improve return on equity, which currently is negative due to consistent net losses.60
Neutral
Cash Flow
Iris Energy's free cash flow remains negative despite a positive operating cash flow of $31.65M TTM, due to substantial capital expenditures. The operating cash flow to net income ratio is positive, indicating cash from operations is better than accounting profits. However, the free cash flow to net income ratio remains negative, necessitating better capital management.50
Neutral
| Breakdown | TTM | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 | Jun 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 5.01M | 188.76M | 75.51M | 59.04M | 7.84M | 2.17M |
| Gross Profit | 3.07M | 166.56M | 57.61M | 51.59M | 5.18M | 868.00K |
| EBITDA | 246.75K | 25.40M | -122.26M | -377.12M | -43.38M | -1.25M |
| Net Income | ― | -28.95M | -171.87M | -419.77M | ― | -2.13M |
Balance Sheet | ||||||
| Total Assets | 33.40M | 1.15B | 332.07M | 570.46M | 134.88M | 11.57M |
| Cash, Cash Equivalents and Short-Term Investments | 15.09M | 411.13M | 68.89M | 109.97M | 39.08M | 1.96M |
| Total Debt | 24.07M | 1.66M | 1.45M | 108.21M | 84.03M | 1.96M |
| Total Liabilities | 25.70M | 55.68M | 26.71M | 133.10M | 184.36M | 2.75M |
| Stockholders Equity | 7.71M | 1.10B | 305.36M | 437.36M | ― | 8.82M |
Cash Flow | ||||||
| Free Cash Flow | ― | -427.19M | -110.02M | -272.69M | ― | -5.32M |
| Operating Cash Flow | 121.56K | 52.72M | 6.04M | 21.56M | 1.64M | -987.00K |
| Investing Cash Flow | ― | -498.47M | -71.47M | -318.12M | ― | -4.49M |
| Financing Cash Flow | 33.91M | 782.13M | 28.24M | 372.04M | 116.57M | 7.31M |
Iris Energy Technical Analysis
Positive
11.87
Price Trends
8.31
Positive
8.38
Positive
9.35
Positive
Market Momentum
0.96
Negative
78.33
Negative
92.62
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IREN, the sentiment is Positive. The current price of 11.87 is above the 20-day moving average (MA) of 10.07, above the 50-day MA of 8.31, and above the 200-day MA of 9.35, indicating a bullish trend. The MACD of 0.96 indicates Negative momentum. The RSI at 78.33 is Negative, neither overbought nor oversold. The STOCH value of 92.62 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IREN.
Iris Energy Risk Analysis
Iris Energy disclosed 99 risk factors in its most recent earnings report. Iris Energy reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 3 New Risks
1.
Disruptions at over-the-counter ("OTC") trading desks and potential consequences of an OTC trading desk's failure could adversely affect our business. We may be required to, or may otherwise determine it is appropriate to, switch to an alternative digital asset trading platform and/or custodian. Q2, 2023
2.
Investing in our Ordinary shares could be subject to greater volatility than investing directly in Bitcoin or other digital assets. Q2, 2023
3.
Future sales, or the possibility of future sales, of a substantial number of our Ordinary shares could adversely affect the price of our Ordinary shares. Q2, 2023
Iris Energy Peers Comparison
Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $16.47B | 11.30 | 9.71% | 3.94% | 11.97% | -10.51% | |
63 Neutral | $2.86B | ― | -3.39% | ― | 130.86% | -22.83% | |
60 Neutral | $490.05M | 8.82 | -23.29% | ― | 53.68% | -265.12% | |
57 Neutral | $517.05M | 290.83 | 1.33% | ― | 174.88% | -97.01% | |
53 Neutral | $1.46B | ― | -56.12% | ― | 31.85% | -34.27% | |
51 Neutral | $1.29B | ― | -18.49% | ― | -0.65% | -808.88% | |
37 Underperform | $28.24M | ― | 242.25% | ― | ― | ― |
* Financial Sector Average
Performance Comparison
IREN
Iris Energy
13.11
1.32
11.20%
WULF
TeraWulf Inc
4.39
-0.02
-0.45%
BTBT
Bit Digital
1.99
-1.36
-40.60%
CIFR
Cipher Mining
4.19
0.00
0.00%
ARBK
Argo Blockchain
0.36
-0.88
-70.97%
FUFU
BitFuFu
3.15
-2.11
-40.11%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.