IREN Ltd. (NASDAQ:IREN) soared by 30.54 percent on Thursday to close at $38.26 apiece, as investors resorted to bargain-hunting following six consecutive days of losses, supported by Citadel’s backing that helped avert a potential fire sale on its stock, alongside a technology giant’s major announcement.
This followed the disposition of Situational Awareness’ huge chunk of holdings across AI players amid the technology sector’s steep decline over the past few weeks. The holdings were subsequently acquired by Citadel LLC, an investment firm founded by Ken Griffin.
IREN Ltd. (NASDAQ:IREN) was one of Situational Awareness’ largest investment holdings, alongside other names including Sandisk, Nebius Group, and Bitdeer Technologies.
Photo from IREN website
Microsoft 2027 Higher Spending Bolsters Outlook
The rally gained further momentum after Microsoft announced in its earnings call that it continues to see growth in capital expenditures for 2027, citing “demand signals across our portfolio.”
Microsoft’s comments reinforced investor confidence that AI infrastructure demand remains strong, with investors betting that key data center players could largely benefit from the higher capital expenditures.
For IREN Ltd. (NASDAQ:IREN), the announcement also validated its AI infrastructure services, particularly given its deepening relationship with Microsoft.
Higher Growth Outlook
IREN Ltd. (NASDAQ:IREN) also earlier this month raised its annualized run-rate revenue (ARR) target to $4 billion from $3.7 billion previously, after bagging $2.8 billion worth of multi-year cloud services contracts with leading AI developers.
The agreement covers both bare metal and managed cloud services to customers including Microsoft, Nvidia, Perplexity, Figure AI, Together AI, Fluidstack, Fireworks AI, Fal AI, Hume AI, and another leading AI developer.
1.2 GW Target in 2027
IREN Ltd. (NASDAQ:IREN) co-founder and co-CEO Daniel Roberts highlighted the company’s rapid expansion of AI cloud capacity as it aims to broaden its customer base across hyperscalers, enterprises, and AI developers.
This year alone, the company is targeting to deliver 480 MW of capacity, and ramp up the figure to 1.2 GW by next year. These compare with only 3 MW of self-built capacity in July 2025.
“IREN remains selective in allocating capacity ahead of commissioning, prioritizing diversification and growth across its customer base and platform layers. Demand from hyperscalers, enterprises, AI developers and frontier labs continues to exceed IREN’s available and planned capacity, and IREN is engaged with customers across its entire 2026 and 2027 expansion program,” Roberts said.
Institutional Participation Rises
Institutional sentiment turned mix for IREN Ltd. (NASDAQ:IREN), with more hedge funds owning stakes in its shares, albeit limited.
Data from Insider Monkey showed that 53 hedge funds held positions in the company as of the first quarter of the year, up from 36 in the fourth quarter of 2025.
However, institutional conviction notably declined, as combined holdings ended at $1.61 billion during the period, marking a 3.6 percent dip from the $1.67 billion in the previous quarter, signaling that while more professional investors seek exposure to its stock, larger allocations remain limited as investors reassess AI-related valuations across the sector.
While we acknowledge the risk and potential of IREN as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than IREN and that has 10,000% upside potential, check out our report about the cheapest AI stock.
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