SYDNEY - IREN Limited (NASDAQ: IREN), a data center business specializing in Bitcoin mining and AI cloud services with a market capitalization of $2.49 billion, announced today its plans to offer $300 million in convertible senior notes due in 2030, with an additional option for initial purchasers to buy up to $45 million more. According to InvestingPro data, the company has demonstrated impressive revenue growth of 119.92% in the last twelve months, though it's currently burning through cash rapidly. These notes, set to mature on June 15, 2030, are senior, unsecured obligations and will be available to qualified institutional buyers.
The offering is subject to market conditions, and the interest rate, initial conversion rate, and other terms will be determined at the time of pricing. IREN intends to use the proceeds for general corporate purposes and working capital. InvestingPro analysis reveals the company maintains an outstanding gross profit margin of 87.67%, though investors should note the stock typically trades with high price volatility. For deeper insights into IREN's financial health and growth prospects, InvestingPro offers 15+ additional exclusive tips and comprehensive analysis in its Pro Research Report. Additionally, IREN will enter into capped call transactions to reduce potential dilution from the conversion of notes and will also engage in a prepaid forward share purchase transaction for up to $100 million of its ordinary shares.
The capped call transactions will cover the number of shares initially underlying the notes, with adjustments for anti-dilution, and are intended to offset the potential cash payments IREN may need to make upon conversion of the notes. However, if IREN's share price exceeds the cap price of the transactions, dilution could still occur.
IREN's entry into the capped call and prepaid forward transactions could affect its ordinary share price, potentially raising the initial conversion price of the notes. The option counterparties and their affiliates plan to purchase IREN's shares and enter derivative transactions following the pricing of the notes, which could also impact the share price and the notes' conversion terms.
The notes and any shares issued upon conversion will not be registered under the Securities Act of 1933 and will be offered under an exemption from registration requirements. This press release is not an offer to sell or a solicitation of an offer to buy any securities.
This announcement contains forward-looking statements subject to uncertainties, risks, and assumptions, and there can be no assurance that the offering will be completed as described or at all. The company cautions that market conditions and other factors could impact the final terms of the offering or the use of proceeds.
IREN emphasizes its commitment to renewable energy, powering its Bitcoin mining and AI cloud services with 100% renewable sources. The company is expanding its operations, aiming to reach 50 EH/s in Bitcoin mining by the first half of 2025 and increasing its data center capacity to 810MW in the same timeframe. Analysts tracked by InvestingPro expect the company to achieve profitability this year, with projected sales growth supporting its ambitious expansion plans. The stock has shown strong momentum, delivering a 126.57% return over the past year.
This news article is based on a press release statement from IREN Limited.
In other recent news, Iris Energy, also known as iRen, has been making waves in the Bitcoin mining industry. Canaccord Genuity and Cantor Fitzgerald recently upheld bullish ratings for the company, citing its low-cost production of Bitcoin and substantial increase in hash rate capacity as key growth drivers. Both firms raised their price targets for Iris Energy, reflecting confidence in the company's trajectory amid a buoyant cryptocurrency market.
Recent developments include Iris Energy's expansion of its Bitcoin mining operations, which is projected to boost its total hash rate to 50 EH/s by June. This strategic move, combined with the potential to unlock significant equity value with its Sweetwater site, has positioned the company favorably in the market.
In the first quarter of fiscal year 2025, Iris Energy reported significant growth in Bitcoin mining and AI cloud services. The company highlighted an adjusted EBITDA of CAD 2.6 million, Bitcoin mining revenue of CAD 54.3 million, and AI cloud services revenue of $3.2 million.
Furthermore, Iris Energy has secured a 1.4 Gigawatt Sweetwater Data Center project in West Texas and expanded its land holdings to over 1,300 acres. The company is also transitioning to a US domestic issuer with US GAAP reporting, indicating a potential inclusion in the Russell 2000 index.
Lastly, the company is exploring alternative funding instruments and considering investor distributions in 2025. These recent developments underscore Iris Energy's commitment to strategic growth and operational efficiency in its Bitcoin mining and AI cloud services operations.
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