Does IREN's 64% Surge Reflect True Value After AI Expansion?

IREN's stock has surged 234.8% over the past year, with a 64.1% increase in the last month. The company's valuation appears undervalued using half of the key methods tracked, with a discounted cash flow model estimating an intrinsic value of $35.62 per share, a 25.7% discount to the current trading price. However, investors should consider broader market shifts and the company's risk-reward profile before making a decision.

IREN Limited's (IREN) stock has surged 234.8% over the past year, with a significant 64.1% increase in the last month alone. This remarkable performance has sparked interest among investors and financial professionals alike. The company's valuation appears undervalued using half of the key methods tracked, with a discounted cash flow model estimating an intrinsic value of $35.62 per share, a 25.7% discount to the current trading price [1].

Financial Highlights

IREN's fiscal year 2025 results were notable for their transformative impact. The company reported total revenue of $501 million, a 168% increase from the previous year, and net income of $86.9 million after a loss of $28.9 million in the prior year [2]. This growth was driven by the company's AI Cloud services and Bitcoin mining operations, which have become key pillars of its strategy.

Bitcoin Mining

Bitcoin mining revenue rose 24% year-over-year to $141.2 million in the third quarter of fiscal 2025, with 728 BTC mined [1]. The average revenue per Bitcoin mined reached $105,730 in June, reflecting strong pricing dynamics and efficient operations. Net electricity costs per Bitcoin mined decreased to $26,259 in June from $27,033 in May, indicating improved cost management [1].

AI Cloud Services

AI Cloud services revenue grew 33% year-over-year to $3.6 million in the third quarter of fiscal 2025. IREN has secured NVIDIA Preferred Partner status to enhance its access to cutting-edge GPU technology and has expanded its GPU fleet to 10.9k units [1]. The company also secured $96 million in non-dilutive financing to support the purchase of GB300s, positioning it to capture strong demand in the AI market and drive the next phase of its AI Cloud revenue growth [6].

Expansion Plans

IREN has secured 2,910 MW of grid-connected power across more than 2,000 acres in the U.S. and Canada, with an additional multi-gigawatt development pipeline [1]. The company plans to install 60,000 NVIDIA's Blackwell GPUs at its British Columbia site in Canada, with a long-term goal of reaching $200 million to $250 million in annualized AI revenue by December 2025 [2].

Analyst Optimism

Analysts have raised price targets for IREN, reflecting confidence in the company's dual-growth engine: AI Cloud services and Bitcoin mining. Joseph Vafi of Canaccord Genuity set a $37.0 target, the highest on record, while H.C. Wainwright and Roth Capital raised theirs to $36 and $35, respectively [3].

Risks and Considerations

While IREN's trajectory is compelling, investors must consider risks such as Bitcoin price volatility and AI Cloud demand cycles. However, the company's diversified revenue streams and strong balance sheet provide a buffer against these headwinds.

Conclusion

IREN's recent share price surge and analyst upgrades signal a paradigm shift in regulated utilities. By leveraging AI Cloud and Bitcoin mining, the company has transformed from a cyclical energy player into a growth-oriented hybrid. As the company executes on its 2025–2026 expansion roadmap, investors should monitor its operational discipline and high-margin ventures.

References

[1] Buy, Sell or Hold IREN Stock? Key Tips Ahead of Q4 Earnings (https://finance.yahoo.com/news/buy-sell-hold-iren-stock-170500901.html)
[2] IREN Limited (IREN) Stock Price, News, Quote & History (https://ca.finance.yahoo.com/quote/IREN/)
[3] IREN Surges on Record Revenue Achievements (https://stockstotrade.com/news/iren-limited-iren-news-2025_08_28/)
[4] Bitcoin Miner Selling A Risk To The BTC Bull Market? (https://cointelegraph.com/news/bitcoin-miners-cash-out-dollar485m-in-btc-here-s-why)
[5] Bitcoin Mining Faces 'Incredibly Difficult' Market as Power Becomes the Real Currency (https://www.coindesk.com/tech/2025/08/24/bitcoin-mining-faces-incredibly-difficult-market-as-power-becomes-the-real-currency)
[6] IREN (IREN) Surges on Transition to AI Service - Yahoo Finance (https://finance.yahoo.com/news/iren-iren-surges-transition-ai-162140841.html)