Nvidia Bets Big on IREN as AI Data Center Race Heats Up

CNBC, Investor’s Business Daily, Reuters, and Market Watch contributed to this report.

IREN just landed one of the biggest endorsements a data center company can get right now: a massive partnership with Nvidia.

The Australian infrastructure operator said it will work with the chip giant to deploy as much as 5 gigawatts of Nvidia’s DSX-branded AI infrastructure across IREN facilities worldwide, a deal aimed squarely at the exploding demand for artificial intelligence computing power.

Investors initially went wild. IREN shares jumped as much as 27% in extended trading before cooling off and closing with a more modest gain of around 6%. The stock has been volatile as traders try to gauge how transformative the partnership could actually become.

As part of the agreement, IREN will give Nvidia the right to buy up to 30 million shares over the next five years at $70 apiece. If fully exercised, Nvidia could pour roughly $2.1 billion into the company.

The structure mirrors a strategy Nvidia has increasingly used across the AI supply chain. Over the past year, the company has signed multibillion-dollar agreements and investment arrangements with firms including Coherent, Lumentum and Corning, tightening its grip on the infrastructure powering the AI boom.

“AI factories are becoming foundational infrastructure for the global economy,” Nvidia CEO Jensen Huang said in a statement, emphasizing the need for tightly integrated systems spanning chips, networking, software and power management.

IREN is also handing Nvidia something equally valuable: computing capacity.

In a separate announcement, the company revealed a five-year, $3.4 billion agreement to provide managed GPU cloud services for Nvidia’s own internal AI research and workloads. The work will be handled out of IREN’s data centers in Childress, Texas, which have increasingly become a centerpiece of the company’s AI ambitions.

That marks a dramatic evolution for IREN, which built much of its early business around bitcoin mining. Like several crypto infrastructure firms, it has spent the past two years pivoting toward AI as demand for high-powered data centers surged alongside generative AI models.

The company already made a major move in that direction late last year when it struck a $9.7 billion infrastructure agreement with Microsoft tied to Nvidia GB300 GPUs. To support that expansion, IREN also signed a separate deal with Dell Technologies worth about $5.8 billion for computing hardware and related systems.

The Nvidia partnership adds another layer of credibility to IREN’s AI push, though investors still appear cautious. Some of Thursday’s pullback came after the company reported revenue that fell short of expectations, reminding traders that building AI infrastructure at this scale remains brutally expensive.

Even so, Nvidia’s willingness to deepen ties with IREN signals how urgently the company is trying to secure global capacity for the next phase of AI growth. Demand for GPU-heavy infrastructure has become so intense that chipmakers are no longer just selling hardware – they’re helping finance and shape the data centers themselves.