May 2024 Monthly Investor Update
IREN (NASDAQ: IREN) released its monthly investor update for May 2024, highlighting key developments in Bitcoin mining, AI cloud services, and data centers. The company mined 230 Bitcoins, achieved an average operating hashrate of 10 EH/s, and plans to expand to 30 EH/s by Q4 2024. AI Cloud Services saw the deployment of 816 NVIDIA H100 GPUs, with an expected annual hardware profit of $14-$17 million. Data center operations reached 260 MW, with expansions to 510 MW by the end of 2024. Financially, IREN reported a cash reserve of $322 million with no debt, despite a decline in Bitcoin mining revenue and increased electricity costs.
- Secured latest-generation Bitmain S21 Pro miners with nameplate efficiency of 15 J/TH.
- Plans to expand Bitcoin mining capacity to 30 EH/s by Q4 2024.
- 816 NVIDIA H100 GPUs operational, generating an estimated $14-$17 million in annualized hardware profit.
- Data center operations reached 260 MW, with expansions to 510 MW by end of 2024.
- $322 million in cash reserves with no debt.
- Completion of Childress Phase 1 ahead of schedule and ongoing progress for Phases 2 and 3.
- Decrease in Bitcoin mined from 358 in April to 230 in May.
- Significant increase in electricity costs for Bitcoin mining, from $7,002k in April to $48,167k in May.
- Decline in Bitcoin mining revenue from $23,691k in April to $15,079k in May.
- Revenue per Bitcoin decreased from $66,210 in April to $65,498 in May.
- Electricity cost per Bitcoin increased significantly from $19,569 in April to $35,475 in May.
Insights
The financial health of IREN appears robust with
Short-term, the steep increase in electricity costs could be a concern for profitability, but long-term prospects remain positive given the planned expansions and advancements in AI cloud services. The company’s strategy to scale up to 30 EH/s by 4Q 2024 and secure energy-efficient mining hardware bodes well for future cost management and profitability. Retail investors should keep an eye on how the company manages operational costs and the impact of energy prices on margins.
IREN’s investment in NVIDIA H100 GPUs for its AI Cloud Services reflects a strategic move towards diversifying revenue streams and leveraging AI technology. The operational 816 GPUs, with 504 contracted to Poolside AI, are estimated to generate annualized hardware profit of
The planned upgrades and expansions in their data centers, with Childress Phase 2 and 3 on schedule, show commitment to infrastructure development and capacity increase, essential for supporting both Bitcoin mining and AI services. The emphasis on sustainability with the use of renewable energy sources is also a strategic advantage, aligning with global trends towards green energy.
Retail investors should consider the potential growth in AI cloud services and the impact of enhanced data center capabilities on future revenues. The diversification into AI offers a buffer against the volatile nature of Bitcoin mining.
The competitive landscape in both Bitcoin mining and AI cloud services is evolving rapidly. IREN's increase in operating hashrate to 10 EH/s and plans to reach 30 EH/s by 4Q 2024 indicate aggressive scaling. This strategy positions IREN to capture a larger share of the Bitcoin mining market, but it also comes with higher operational risks and capital needs. The timing of these expansions is crucial, especially given the cyclical nature of Bitcoin’s value and its direct impact on revenue.
On the AI front, the partnership with Poolside AI and the operational focus on servicing on-demand clients underscores a proactive approach to market demands. However, continuous technological advancements and competitor movements could pressure IREN to innovate consistently. Their exploration of growth financing opportunities could be both a strength and a potential dilution risk for current shareholders.
For retail investors, it’s important to weigh the growth potential against the operational and market risks. The ongoing construction projects and AI initiatives present substantial growth opportunities but also require careful management and execution.
SYDNEY, June 06, 2024 (GLOBE NEWSWIRE) -- IREN (NASDAQ: IREN) (together with its subsidiaries, “IREN” or “the Company”), a leading next-generation data center business powering the future of Bitcoin, AI and beyond, today published a monthly investor update for May 2024.
Key Highlights
Bitcoin Mining
| AI Cloud Services
|
Data Centers
| Corporate
|
| Key Metrics | May-24 | Apr-24 | Mar-24 |
| Bitcoin Mining2 | |||
| Average operating hashrate (PH/s) | 9,414 | 8,238 | 7,107 |
| Renewable energy usage (MW)3 | 246 | 220 | 195 |
| Bitcoin mined | 230 | 358 | 353 |
| Mining revenue (US$'000) | 15,079 | 23,691 | 23,705 |
| Electricity costs (US$'000)4 | 8,167* | 7,002 | 7,172 |
| Hardware profit margin (%)5 | |||
| Revenue per Bitcoin (US$) | 65,498 | 66,210 | 67,235 |
| Electricity cost per Bitcoin (US$) | 35,475 | 19,569 | 20,343 |
| AI Cloud Services | |||
| AI Cloud Services revenue (US$'000) | 892 | 581 | 408 |
| Electricity costs (US$'000) | 16 | 7 | 9 |
| Hardware profit margin (%)5 |
*Note: The Company’s Childress site generated an estimated ~
Bitcoin Mining
May operations
- Average operating hashrate of 9.4 EH/s (now expanded to 10 EH/s)
- Decrease in Bitcoin mined in May due to reduced block subsidy (post-halving), partially offset by
14% increase in average operating hashrate
2024 expansion plans increased to 30 EH/s
- Secured latest-generation Bitmain S21 Pro miners with nameplate efficiency of 15 J/TH
- At 30 EH/s, nameplate fleet efficiency of 16 J/TH and indicative electricity cost per BTC of
$17 k6 - Upgrade of existing miner fleet across BC and Texas
- Miners secured to support 40 EH/s in 1H 2025
AI Cloud Services
IREN CCO Kent Draper discussing how IREN is solving AI and sustainability challenges at Dell Tech World
AI Cloud Services
- 816 NVIDIA H100 GPUs operating
- 504 GPUs contracted with Poolside AI
- Servicing on-demand market
- 816 GPUs generates an estimated ~
$14 -$17m of annualized hardware profit (~24 month payback)7 - Customer conversations ongoing with respect to both cloud and colocation solutions
- Exploring growth financing opportunities
Data Centers
Childress (May 2024)
510MW of data centers in 2024
- Childress Phase 1 (100MW) – completed ahead of schedule
- Childress Phase 2 (100MW) – 3Q 2024
- Foundations, building structures and electrical works ongoing
- Childress Phase 3 (150MW) – 4Q 2024
- Civil works underway
- >3,000MW power & land portfolio presents significant opportunity
Data Center | Capacity (MW) | Capacity (EH/s)8 | Timing | Status | |||
| Canal Flats (BC, Canada) | 30 | 0.9 | Complete | Operating | |||
| Mackenzie (BC, Canada) | 80 | 2.7 | Complete | Operating | |||
| Prince George (BC, Canada) | 50 | 1.6 | Complete | Operating | |||
| Childress Phase 1 (Texas, USA) | 100 | 4.8 | Complete | Operating | |||
| Total Operating | 260 | 10 | |||||
| Fleet Upgrade (Incremental) | - | 4 | 3Q 2024 | Miners secured | |||
| Childress Phase 2 (Texas, USA) | 100 | 6 | 3Q 2024 | Under construction | |||
| Childress Phase 3 (Texas USA) | 150 | 10 | 4Q 2024 | Under construction | |||
| Total Operating & Construction | 510 | 30 | |||||
| Childress Phase 4-6 (Texas, USA) | 250 | TBD | Power available | ||||
| Development Site (Texas, USA) | 1,400 | Late 2026 | Connection underway | ||||
| Additional Pipeline | >1,000 | Development | |||||
| Total | >3,000 | ||||||
Corporate
The IREN Canal Flats team was proud to participate in the annual Canal Days celebration and parade
Corporate
- Reported 3Q FY24 results
- Record revenue, adjusted EBITDA and operating cashflow
$322m cash, no debt1- Watch the webcast replay here
- Partnered with the District of Mackenzie to bring high speed fibre-optic connectivity to Mackenzie
- Enhances connectivity for residents
- Provides dual redundancy to data center
Upcoming events
- Collision, Toronto (Jun 17 - 20, 2024)
- IREN Analyst Day, NYC (Jul 23, 2024)
- IREN Investor Event, NYC (Jul 23, 2024)
- Bitcoin 2024, Nashville (Jul 25 - 27, 2024)
Assumptions and Notes
- Reflects USD equivalent, unaudited cash and cash equivalents as of April 30, 2024.
- Bitcoin and Bitcoin mined in this investor update are presented in accordance with our revenue recognition policy which is determined on a Bitcoin received basis (post deduction of mining pool fees).
- Comprises actual power usage for Canal Flats, Mackenzie, Prince George, and Childress. The Company’s Canal Flats, Mackenzie and Prince George sites have been powered by
100% renewable energy since inception of which approximately98% is directly from renewable energy sources; approximately2% is from the purchase of RECs. The Company’s Childress site has been powered by100% renewable energy since inception via the purchase of RECs. - Electricity costs presented on a net basis and calculated as IFRS electricity charges net of realized gain/(loss) on financial asset, ERS revenue (included in other income) and ERS fees (included in other operating expenses). Figures are based on current internal estimates and exclude REC purchases.
- Hardware profit margin for Bitcoin mining and AI Cloud Services is calculated as revenue less net electricity costs, divided by revenue (for each respective revenue stream) and excludes all other costs.
- Represents indicative electricity cost per bitcoin mined assuming 30 EH/s, nameplate fleet efficiency of 16 J/TH, weighted average power cost of
$0.03 7/kWh ($0.04 5/kWh in BC and$0.03 3/kWh in Texas – latter calculated using actual monthly average net power price at Childress during 3Q YTD FY24 (i.e. July 2023 to March 2024), including ERS revenue and adjusted for now eligible 4CP benefit), global hashrate of 603 EH/s, block reward of 3.125 BTC per block and transaction fees of 0.3 BTC per block. - Illustrative annualized hardware profit = revenue less assumed electricity costs (excludes all other site, overhead and REC costs). GPU calculations assume 1.25kW power draw required for 1 GPU,
$0.05 /kWh electricity costs and$2.00 -2.50 per GPU hour revenue assumption. Capex assumes ~$40 k per GPU. - Capacity to be installed comprises Bitmain T21 and S21 Pro miner purchases and miner purchase options. Additional S21 Pro miners secured will also be used to upgrade the existing fleet. Final decisions with respect to exercising miner purchase options will be made during 2024 taking into consideration market and funding conditions.
Contacts
| Media Jon Snowball Domestique +61 477 946 068 Danielle Ghigliera Aircover Communications +1 510 333 2707 | Investors Lincoln Tan IREN +61 407 423 395 lincoln.tan@iren.com |
To keep updated on IREN’s news releases and SEC filings, please subscribe to email alerts at
https://iren.com/investor/ir-resources/email-alerts.
Forward-Looking Statements
This investor update includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to future events or IREN’s future financial or operating performance. For example, forward-looking statements include but are not limited to the Company’s business strategy, expected operational and financial results, and expected increase in power capacity and hashrate. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “believe,” “may,” “can,” “should,” “could,” “might,” “plan,” “possible,” “project,” “strive,” “budget,” “forecast,” “expect,” “intend,” “target”, “will,” “estimate,” “predict,” “potential,” “continue,” “scheduled” or the negatives of these terms or variations of them or similar terminology, but the absence of these words does not mean that statement is not forward-looking. Such forward-looking statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. In addition, any statements or information that refer to expectations, beliefs, plans, projections, objectives, performance or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking.
These forward-looking statements are based on management’s current expectations and beliefs. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause IREN’s actual results, performance or achievements to be materially different from any future results performance or achievements expressed or implied by the forward looking statements, including, but not limited to: Bitcoin price and foreign currency exchange rate fluctuations; IREN’s ability to obtain additional capital on commercially reasonable terms and in a timely manner to meet its capital needs and facilitate its expansion plans; the terms of any future financing or any refinancing, restructuring or modification to the terms of any future financing, which could require IREN to comply with onerous covenants or restrictions, and its ability to service its debt obligations, any of which could restrict our business operations and adversely impact our financial condition, cash flows and results of operations; IREN’s ability to successfully execute on its growth strategies and operating plans, including its ability to continue to develop its existing data center sites and to diversify into the market for high performance computing (“HPC”) solutions, and in particular any current or future AI Cloud (“AI Cloud”) Services we offer; IREN’s limited experience with respect to new markets it has entered or may seek to enter, including the market for AI Cloud Services; expectations with respect to the ongoing profitability, viability, operability, security, popularity and public perceptions of the Bitcoin network; expectations with respect to the profitability, viability, operability, security, popularity and public perceptions of any current or future AI Cloud Services that IREN offers; IREN’s ability to secure and retain customers on commercially reasonable terms or at all, particularly as it relates to its strategy to expand into AI Cloud Services; IREN’s ability to manage counterparty risk (including credit risk) associated with any current or future customers, including customers of our AI Cloud Services and other counterparties; IREN’s ability to secure renewable energy, renewable energy certificates, power capacity, facilities and sites on commercially reasonable terms or at all; the risk that any current or future customers, including customers of our AI Cloud Services, or other counterparties may terminate, default on or underperform their contractual obligations; Bitcoin global hashrate fluctuations; delays associated with, or failure to obtain or complete, permitting approvals, grid connections and other development activities customary for greenfield or brownfield infrastructure projects; our reliance on power and utilities providers, third party mining pools, exchanges, banks, insurance providers and our ability to maintain relationships with such parties; expectations regarding availability and pricing of electricity; IREN’s participation and ability to successfully participate in demand response products and services and other load management programs run, operated or offered by electricity network operators, regulators or electricity market operators; the availability, reliability and/or cost of electricity supply, hardware and electrical and data center infrastructure, including with respect to any electricity outages and any laws and regulations that may restrict the electricity supply available to IREN; any variance between the actual operating performance of IREN’s miner hardware achieved compared to the nameplate performance including hashrate; IREN’s ability to curtail its electricity consumption and/or monetize electricity depending on market conditions, including changes in Bitcoin mining economics and prevailing electricity prices; actions undertaken by electricity network and market operators, regulators, governments or communities in the regions in which IREN operates; the availability, suitability, reliability and cost of internet connections at IREN’s facilities; IREN’s ability to secure additional hardware, including hardware for Bitcoin mining and any current or future AI Cloud Services it offers, on commercially reasonable terms or at all, and any delays or reductions in the supply of such hardware or increases in the cost of procuring such hardware; expectations with respect to the useful life and obsolescence of hardware (including hardware for Bitcoin mining as well as hardware for other applications, including any current or future AI Cloud Services IREN offers); delays, increases in costs or reductions in the supply of equipment used in IREN’s operations; IREN’s ability to operate in an evolving regulatory environment; IREN’s ability to successfully operate and maintain its property and infrastructure; reliability and performance of IREN’s infrastructure compared to expectations; malicious attacks on IREN’s property, infrastructure or IT systems; IREN’s ability to maintain in good standing the operating and other permits and licenses required for its operations and business; IREN ability to obtain, maintain, protect and enforce its intellectual property rights and confidential information; any intellectual property infringement and product liability claims; whether the secular trends IREN expects to drive growth in its business materialize to the degree it expects them to, or at all; the occurrence of any environmental, health and safety incidents at IREN’s sites, and any material costs relating to environmental, health and safety requirements or liabilities; damage to our property and infrastructure and the risk that any insurance IREN maintains may not fully cover all potential exposures; ongoing proceedings relating to the default by two of IREN’s wholly-owned special purpose vehicles under limited recourse equipment financing facilities; ongoing securities litigation relating in part to the default; and any future litigation, claims and/or regulatory investigations, and the costs, expenses, use of resources, diversion of management time and efforts, liability and damages that may result therefrom; IREN's failure to comply with any laws including the anti-corruption laws of the United States and various international jurisdictions; any failure of IREN's compliance and risk management methods; any laws, regulations and ethical standards that may relate to IREN’s business, including those that relate to Bitcoin and the Bitcoin mining industry and those that relate to any other services we offer (such as AI Cloud Services), including regulations related to data privacy, cybersecurity and the storage, use or processing of information; our ability to attract, motivate and retain senior management and qualified employees; increased risks to our global operations including, but not limited to, political instability, acts of terrorism, theft and vandalism, cyberattacks and other cybersecurity incidents and unexpected regulatory and economic sanctions changes, among other things; climate change, severe weather conditions and natural and man-made disasters that may materially adversely affect our business, financial condition and results of operations; public health crises, including an outbreak of an infectious disease (such as COVID-19) and any governmental or industry measures taken in response; our ability to remain competitive in dynamic and rapidly evolving industries; damage to our brand and reputation; expectations relating to Environmental, Social and Governance issues or reporting; the costs of being a public company; and other important factors discussed under the caption “Risk Factors” in IREN’s annual report on Form 20-F filed with the SEC on September 13, 2023 as such factors may be updated from time to time in its other filings with the SEC, accessible on the SEC’s website at www.sec.gov and the Investor Relations section of IREN’s website at https://investors.iren.com.
These and other important factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this investor update. Any forward-looking statement that IREN makes in this investor update speaks only as of the date of such statement. Except as required by law, IREN disclaims any obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements, whether as a result of new information, future events or otherwise.
Preliminary Financial Information
The preliminary financial information included in this investor update is not subject to the same closing procedures as our unaudited quarterly financial results and has not been reviewed by our independent registered public accounting firm. The preliminary financial information included in this investor update does not represent a comprehensive statement of our financial results or financial position and should not be viewed as a substitute for unaudited financial statements prepared in accordance with International Financial Reporting Standards. Accordingly, you should not place undue reliance on the preliminary financial information included in this investor update.
Non-IFRS Financial Measures
This investor update includes non-IFRS financial measures, including electricity costs (presented on a net basis) and hardware profit margin. We provide these measures in addition to, and not as a substitute for, measures of financial performance prepared in accordance with IFRS. There are a number of limitations related to the use of non-IFRS financial measures. For example, other companies, including companies in our industry, may calculate these measures differently. The Company believes that these measures are important and supplement discussions and analysis of its results of operations and enhances an understanding of its operating performance.
Photos accompanying this announcement are available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/d0a5ec9d-f8a6-44c4-84a0-97564a055cd8
https://www.globenewswire.com/NewsRoom/AttachmentNg/733e26da-23a0-46a6-b91f-023e1f66fd89
https://www.globenewswire.com/NewsRoom/AttachmentNg/04f2ee16-eb78-44c8-9b7d-4ee28580b3d3
https://www.globenewswire.com/NewsRoom/AttachmentNg/931afe56-f63c-4c44-b64b-5d9fb5ff1761
FAQ
How many Bitcoins did IREN mine in May 2024?
What is IREN's Bitcoin mining capacity expansion plan for 2024?
How much annualized hardware profit does IREN expect from its AI Cloud Services?
What were the electricity costs for Bitcoin mining in May 2024?
What is the current operating capacity of IREN's data centers?
What was IREN's Bitcoin mining revenue in May 2024?
How much cash reserve does IREN have as of May 2024?
What was the electricity cost per Bitcoin for IREN in May 2024?
