Founded and built @loopinternet; acquired by Greenlight in 2025 and T-Mobile in 2026. Building more internet @ Layer1
Philly & Middle of Nowhere VA
Joined October 2008
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The demand for wireless capacity is going to be unlike anything we’ve ever seen before due to AI, robots, wearables, etc. There’s going to be immense amounts of data transmitted from your personal AI to the cloud 24/7.
If this is something you’re interested in working on, DM me.
I think we should all consider that @chamath also posted that he sees $IREN and $NBIS as two of the winners...
The market needs to start separating Neoclouds with power and low debt from Neoclouds with no power and high debt. It's still treating them all the same.
As someone with a portfolio of energized land assets here is what I am seeing:
1. Neoclouds are disorganized and poorly capitalized. Some are definitely better than others however.
2. Hyperscalers are intractable, bureaucratic organizations that take 3 months to do an NDA and want 18mo escrow periods. We built our portfolio by competing against these terms because of our speed and simplicity. The more future assets orgs like ours win, the bigger the problem for the hyperscalers downstream (see 3).
3. There are delays in the existing pipeline that will catch people off guard in 2027. Hyperacalers will (obviously) react by focusing on their own internal compute needs over any third party. If the third party is a model company, they will tell them to go through their model router where they will also take a non-trivial vig. Them telling Ant they have no compute for them (rumored in Ant’s S-1) if true is a huge tell that this is already happening.
All of this is to say that it does look like there will be a lot of partially stranded compute and compute sitting in inventory in 2027 than is currently forecasted. This is bought and paid for but effectively underearning (below total cost of capital) or collecting dust. We see this as true for everyone - model companies, hyperscalers, neoclouds except ONE (you can guess which one).
This dislocation will benefit two kinds of orgs: the non-bureaucratic big scalers who can build industrial scale quickly and the nimble, well capitalized players feeding them.
2027 will be a turbulent year because it will clear out a bunch of wrong/bad bets. It will also be a consolidation year for a few.
xitter.cf/i/trending/21144208912…
"Investors eye Iris Energy (IREN) as a potential winner in the AI data center rush, thanks to its secured power in Texas and big deals with Microsoft and NVIDIA."
The datacenter and compute boom is the modern day equivalent to the railroad boom of the late 1800’s.
If Andrew Carnegie was alive today. What would he be doing and why? What industry would he be attacking, how would he be attacking it?
Chris Hacken retweeted
Warren Buffett would pick $IREN. Its scarce power assets (key for AI data centers) provide a more tangible edge than pure GPU rentals, and the recent sharp drop creates a clearer margin of safety versus peers trading on richer multiples. He still dislikes the crypto roots and prefers proven cash flows, so none fully fit—but among these it best matches his undervalued-infrastructure bias.
The market is completely disconnected from the reality of AI demand.
AWS, Google, etc are all sold out through 2027. Power and Datacenters take years to bring online.
I expect 2027 to be the largest compute crunch in history.
$IREN will likely hit $200/share at some point this year as they start to lock in future demand at insane price points.
$NBIS and other Neoclouds will likely also see 600% gain this year; depending on if they can actually bring facilities online. That’s the only barrier; being able to turn datacenters up.
I think $NVDA and the other chip makers may actually start to hit a wall as chip production starts to catch up with our ability to power them.
Chris Hacken retweeted
Two prices for $IREN , and they're nowhere near each other.
In May, $NVDA signed for the right to buy in at 70 a share.
Up to 30 million shares over five years.
Friday's close was $24.91.
That's 64% below the price they signed for.
Either that price was a fantasy, or this selloff went too far.
November 5 will tell us. I hold it, so I'll be watching.
Chris Hacken retweeted
IREN’s @danroberts0101 speaks to @ArjunKharpal about AI financing and demand on CNBC.
Watch the full interview.
Chris Hacken retweeted
“Higher rates will kill $IREN"💀
I have heard that a lot lately. So I ran the numbers. Per MW.
Last quarter, IREN guided for $25–30bn of capex in FY27. Thats a lot of debt, and I get why it scares people.
Every time I have said the fundamentals have gotten better this year, I have gotten a lot of hate. Thats fair, and I understand it. Debt can be scary.
So in this post I will try to show why I say what I say. I built a model of the cost per MW and how higher rates actually change IREN’s profitability.
Step 1: $IREN’s own math
Recent 3-year contracts: >$20m revenue per MW (IT) per year.
Payback on the GPUs: ~2 years (revenue minus direct costs).
Work that backwards and you land at ~$35m of GPU capex per MW.
Step 2: put the debt on top
90% of GPU capex financed at 9% (Blue Owl / PIMCO)
Paid down over the 3-year contract
Data center debt on top of that
That’s ~$31m of GPU debt per MW. Sounds like a lot, right?
Here’s the thing people miss: the debt amortizes with the contract. The customer is literally paying it down.
Average interest ends up at ~$2.4m per MW per year. That’s ~12% of revenue.
Step 3: the stress test (the part the bears skip)
What does IREN need in revenue per MW to make the same profit if rates go up?
Debt at 12% → $21.0m/MW
Debt at 15% → $22.0m/MW
Debt at 18% → $23.0m/MW
And if they got zero extra pricing? At 15% they’d still sit at ~28% margin per MW.
Profit per MW only hits zero around ~34% interest. 👀
Step 4: now look at what pricing has done
While everyone has been worried about financing costs, compute pricing has gone the other way.
Just look at the GPU rental data from @silicondata: prices are up from ~$6 to ~$7.5 an hour since July. Over the same period, the stock has lost ~50% of its market cap.
IREN’s own contracts tell the same story:
MSFT deal: ~10-11m/MW
3-year pricing: up ~125% since November
NVIDIA deal (May): ~$14m/MW
Recent deals (September): ~$23m/MW
Active talks: ~$25m/MW and increasing🔥
At $25m/MW, IREN could pay ~24% on its debt and still make the same profit per MW as at $20m and 9% today.🤯
And I havent even counted the prepayments. Customers are paying 45–55% of the GPU capex up front. Interest-free.
“Starting to finance our build-out for us.”
Dan Roberts, on IREN’s customers
So what am I actually saying?
A 6pp rate hike costs IREN ~$2m per MW.
Going from $20m to $25m per MW is worth ~$5m per MW.
The debt has grown, yes.
The economics of every MW that debt is financing have grown faster.
TLDR= Pricing > rates
Chris Hacken retweeted
Feels like the public interpretation is all wrong…
I’m pretty sure $MSFT backing out on NScale deal is bullish for Neoclouds like $NBIS or even $IREN with energized capacity with Microsoft?
Pretend Microsoft just ate a bunch of Chipotle burittos:
- They order toilet paper delivery scheduled Q1 2027
- NScale says: sorry 3-4+ year delay of the toilet paper (into 2030’s) because of UK grid constraints
- Microsoft still urgently needs toilet paper so they will get it elsewhere
The cancellation does send warnings about what happens if a Neocloud can’t execute on contracted demand.
But that just makes the other toilet paper sellers more valuable since Microsoft will go elsewhere for supply.
This is what I’m counting on. You have 8 months to go bananas to 100+ before my options expire.
$IREN Has formed a lower low which was always a risk for this stock, now that the lower low is complete we just need to fund support before the next leg higher 📈
I warned back in August that a lower low below $30 was needed, its now here and $IREN is searching for support.
$IREN Is approaching its 0.786FIB & 200 WMA, this is a support zone which could offer a floor for $IREN and a zone which can trigger a reversal. The drawdown is very close to being complete for this stock, the next phase will be VERY bullish with a move to +$130 a share 📈
Available capacity is slipping or non-existent... new capacity is getting harder and harder to develop. Those that have it today are in an incredible position for the next 2-3 years until more comes online, if it comes online. $IREN
A lot of questions this week on funding, so here's how a GPU typically gets funded at $IREN.
First, the customer signs a multi-year take-or-pay contract and agrees to a prepayment. On our recent 3-year contracts, prepayments have been 45% to 55% of the associated GPU capex.
Second, financing is committed, secured by the contracted GPUs. On the Microsoft contract we secured an A-rated facility at around 6%, which together with prepayments covers 96% of GPU capex. More recently, for a non-investment grade counterparty at Mackenzie, we secured financing at 9% fixed, which together with prepayments covers more than the full cost of the GPUs.
That's the GPU side. The data centers are a separate, long-term asset base, and we own the ones our GPUs run in. Construction has been funded from cash to date, with no debt against these multi-billion dollar assets. As they come online with contracted customers, they can support financing in their own right.
The processes behind the next facilities are continuing, and new paper will cost what the market charges. With GPU paybacks of around two years on our recent 3-year contracts, a wider spread barely moves the economics.
There's more customer demand than we can build for. As we noted at our recent earnings, 2026 is largely sold out, recent 3-year contracts are at more than double the prior year's pricing, and demand for anything we can bring online in 2027 covers it several times over, with prepayments a focus in every negotiation. Conversations on 2028 capacity are already underway.
Meanwhile announced capacity keeps slipping across the industry, which is the point: signing deals isn't the bottleneck in this market, bringing GPUs online is, and that's our focus.
Even if you don't think $IREN has bottomed.. there is wayyyy more upside than downside from here.
