SYDNEY - IREN (NASDAQ: IREN), a data center company specializing in Bitcoin mining and AI cloud services, has released its monthly investor update for July 2024, revealing progress in its operations and expansion plans. The company mined 222 Bitcoins in July and reported an installed hashrate of 10.5 EH/s as of August 5, with expectations to reach 20 EH/s in the third quarter and 30 EH/s in the fourth quarter.
Despite planned outages for substation upgrades and a production issue with T21 miners, which are being replaced by Bitmain, IREN's average operating hashrate for July was 9,008 PH/s. The company noted an increase in electricity costs due to higher energy hedge pricing at its Childress site during the summer months. However, IREN is re-assessing its energy pricing structures to improve efficiency.
In the AI cloud services sector, IREN has expanded its GPU fleet with 816 NVIDIA (NASDAQ:NVDA) H100 GPUs and reported a revenue increase of 17% compared to June and 42% compared to May. The company has serviced six end-customers to date and plans to launch a GPU pilot in Childress in the second half of 2024.
IREN's data center capacity is at 260MW, with plans to reach 510MW in 2024. The Childress power capacity has been increased from 600MW to 750MW, supporting the company's expansion efforts. Construction is underway for Phase 2 and Phase 3 data centers in Childress, which will contribute to the increased capacity.
Financially, IREN reported mining revenue of $13.592 million in July, with a net electricity cost of approximately $13.674 million, reflecting power sales and ERS revenue. The hardware profit margin for Bitcoin mining was reported at -1% due to high electricity costs, while the AI cloud services segment maintained a 98% hardware profit margin.
The company has appointed Morgan Stanley as its financial advisor to evaluate monetization opportunities in the AI data center market. IREN has also participated in several industry events and has plans to attend upcoming conferences in Boston, Jackson Hole, and Singapore.
This news article is based on a press release statement from IREN.
In other recent news, Iris Energy has reported significant advancements in both revenue and earnings. The company registered a positive cash flow from operations at $48 million and a net profit before tax of $12 million. Iris Energy's Bitcoin mining operations mined 233 Bitcoin in June, with an anticipated increase in hash rates in the upcoming quarters. Additionally, the company's AI Cloud Services division saw a 21% revenue increase in June.
Analysts from B.Riley, Canaccord Genuity, and Cantor Fitzgerald have adjusted Iris Energy's price target, reflecting the company's potential in the AI hosting market and its Bitcoin mining operations. Iris Energy's expansion plans for 2024 are fully funded, with a cash reserve of $425.3 million and no debt. The company's data center operations are also expanding, with 510MW expected to be operational by the end of 2024.
The company's hash rate capacity is projected to surge from the current 9.4 EH/s to over 40 EH/s by mid-2025. Iris Energy is expected to reach 30 EH/s in Bitcoin mining capacity and grow its data center operations to 510MW by the year-end. These are recent developments, highlighting Iris Energy's commitment to driving shareholder value and positioning itself as a leading publicly listed miner.
InvestingPro Insights
As IREN (NASDAQ: IREN) advances in its Bitcoin mining operations and AI cloud services, the latest financial metrics from InvestingPro offer a snapshot of the company's market position. With a market capitalization of $1.57 billion, IREN demonstrates significant industry presence. Despite a challenging week with a price total return of -10.66% and a monthly return of -44.24%, the company's three-month and six-month price total returns have been noteworthy, at 58.11% and 118.23% respectively, indicating a potential rebound and investor confidence in its long-term prospects.
InvestingPro Tips highlight two aspects crucial to understanding IREN's current financial health and future outlook. Firstly, analysts anticipate sales growth in the current year, which aligns with IREN's expansion plans and installed hashrate increase. Secondly, the company's impressive gross profit margin, standing at 88.16% for the last twelve months as of Q3 2024, underscores its ability to manage costs effectively amidst its expansion endeavors.
For investors seeking a more comprehensive analysis of IREN, there are 15 additional InvestingPro Tips available, which provide deeper insights into the company's financials, market performance, and industry standing. These tips are accessible through InvestingPro's platform for those looking to make informed investment decisions based on real-time data and expert analysis.
IREN's financial advisory appointment with Morgan Stanley and its ongoing participation in industry events reflect a proactive approach to capitalizing on market opportunities. As the company navigates the highs and lows of the tech and energy sectors, these InvestingPro insights serve as valuable tools for stakeholders to keep abreast of IREN's financial journey.
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