Nebius Group vs. Iren Limited: Which AI Infrastructure Stock Offers a More Compelling Long-Term Growth Proposition?

The global AI infrastructure race is intensifying, with companies racing to scale data centers, secure cutting-edge hardware, and forge strategic partnerships. Two players-Nebius Group and Iren Limited-stand out as contenders in this high-stakes arena. This analysis evaluates their long-term growth potential through the lenses of infrastructure scalability and financial sustainability, drawing on recent developments and financial metrics.

Nebius Group: Strategic Partnerships and Technical Innovation Drive Scalability

Nebius Group has positioned itself as a key enabler of enterprise AI adoption through aggressive partnerships and technical advancements. In 2025, the company secured a $17 billion AI infrastructure deal with Microsoft and a $3 billion agreement with Meta, cementing its role in powering large-scale AI workloads for hyperscalers and enterprises according to reports. These partnerships are not merely financial windfalls; they signal confidence in Nebius's ability to deliver scalable, high-performance infrastructure.

Technologically, Nebius has demonstrated near-linear scalability in its cloud services. In Q2 2025, the company achieved a 1.97x speedup when doubling its GPU cluster size from 512 to 1,024 NVIDIA Hopper units during training of the Llama 3.1 405B model according to Q2 2025 updates. This performance is further enhanced by topology-aware job scheduling, which improves efficiency by 10–25% across workloads. The integration of NVIDIA Blackwell GPUs into its cloud platform also underscores Nebius's commitment to staying at the forefront of hardware innovation according to August 2025 digest.

However, Nebius's growth is heavily dependent on third-party partnerships. While its collaborations with Microsoft and Meta are robust, the company lacks the self-funded capital expenditures seen in competitors like Iren Limited. This reliance on external validation and investment could pose risks if market dynamics shift or partners prioritize in-house solutions.

Iren Limited: Financial Strength and Renewable Energy-Backed Expansion

Iren Limited (IREN) has emerged as a formidable player in AI infrastructure, leveraging strong financial performance and renewable energy advantages to scale its operations. For FY 2025, IREN reported $501 million in revenue and $269.7 million in Adjusted EBITDA, with a margin of 53.83% according to financial modeling. This financial health is further bolstered by $1.8 billion in cash and equivalents as of October 2025 according to Q1 FY26 results, providing a buffer for capital-intensive projects.

IREN's infrastructure strategy is anchored in sustainability and scalability. Its data centers, powered by 100% renewable energy, span 2,910 MW of total capacity across North America according to company data. The company is expanding GPU capacity from 1.9k to 10.9k units, including 9k NVIDIA Blackwell GPUs, with a target of 140,000 GPUs by 2026 according to Q1 FY26 results. This growth is supported by $9.7 billion in AI Cloud contracts with Microsoft, including a 20% prepayment structure that reduces cash flow risks according to Q1 FY26 results.

IREN's financial flexibility is also evident in its innovative financing strategies. The company secured $200 million in non-dilutive GPU financing and plans to raise $2 billion in convertible bonds to fund data center construction and GPU procurement according to latest news. These moves highlight IREN's ability to scale without overleveraging its balance sheet, a critical advantage in capital-intensive industries.

Comparative Analysis: Scalability vs. Financial Sustainability

Infrastructure Scalability:
Nebius Group excels in technical scalability, with proven performance metrics and cutting-edge hardware integration. Its partnerships with Microsoft and Meta provide access to vast enterprise markets, but its growth is contingent on maintaining these relationships. Iren Limited, meanwhile, is scaling through self-funded expansion and renewable energy advantages, with a clear roadmap to 140,000 GPUs by 2026 according to Q1 FY26 results. IREN's prepayment terms with Microsoft add a layer of financial predictability, reducing execution risks.

Financial Sustainability:
IREN's financials are a standout. With $1.8 billion in liquidity, a 53.83% EBITDA margin, and a $3.4 billion annualized revenue target by 2026, the company appears well-positioned to sustain growth without aggressive debt accumulation according to financial modeling.Nebius, while growing rapidly, lacks comparable liquidity and relies on third-party funding for expansion. This could limit its agility in a competitive market.

Conclusion: Balancing Risk and Reward

Nebius Group and Iren Limited represent two distinct approaches to AI infrastructure. Nebius is a high-growth, partnership-driven company with technical prowess but limited financial autonomy. IREN, by contrast, combines financial strength, renewable energy advantages, and prepayment structures to create a more sustainable growth model.

For investors prioritizing long-term stability, IREN's robust balance sheet and diversified financing strategies make it the more compelling choice. However, those willing to tolerate higher risk for potential outsized returns may find Nebius's strategic partnerships and technical innovation appealing. Ultimately, IREN's ability to scale independently while maintaining profitability gives it a slight edge in the AI infrastructure race.