Home / Business and Economy / JPMorgan Backs IREN Despite Price Target Cut
JPMorgan Backs IREN Despite Price Target Cut
11 Nov
Summary
- IREN's AI cloud revenue surged 182% to $200 million in fiscal Q1 2027.
- JPMorgan analyst Richard Choe maintained a Buy rating with a new target.
- GPU prices for IREN's long-term deals rose significantly quarter-over-quarter.
AI data center operator IREN Limited experienced a significant surge in AI cloud revenue, reaching $200 million in fiscal Q1 2027, an 182% increase from the previous quarter. This growth was bolstered by the delivery of the first phase of its data center project with Microsoft. JPMorgan analyst Richard Choe initiated coverage with a Buy rating, highlighting strong pricing power for IREN's GPUs.
Choe noted an 11% rise in three-year GPU deal prices and a 12% increase for five-year deals quarter-over-quarter. Following the quarter's end, IREN secured a five-year deal at $22 million per megawatt with a 90% upfront payment for GPUs, and a short-term deal at $40 million per megawatt. The company also leased older Nvidia H100 chips at double their previous price.
Despite the positive outlook, Choe adjusted his price target downwards by 15% to $55, citing concerns about the pace of capacity development and funding methods. However, he also acknowledged that recent high pre-payments and contract signings mitigate risk and maintain momentum for IREN.
