IREN Doubles Down on Pricing: Can Revenue Per MW Keep Rising?
IREN Limited IREN is seeing a sharp improvement in the economics of its infrastructure business, with revenue per megawatt (MW) emerging as an important growth driver. Recent three-year contracts were signed at more than $20 million of revenue per IT MW, while discussions around $25 million per MW point to further upside. IREN estimates that contracts above $20 million per MW can generate roughly a two-year payback.
Pricing momentum has strengthened materially. IREN said pricing on three-year contracts increased about 125%, while five-year contract pricing rose roughly 70% from the November 2025 levels. Its expanding platform and stronger market position are helping it negotiate better pricing and terms. With 2026 capacity largely sold out and $4 billion in contracted annualized run-rate revenue, tight supply further supports its negotiating position.
IREN is also improving project economics through customer prepayments and financing. Recent prepayments covered 45%-55% of GPU capex, reducing the capital IREN must fund. Spare power at existing facilities and power management technologies could also allow more GPUs to be deployed within available MW, potentially increasing revenues without equivalent increases in grid capacity.
The company is expanding beyond basic GPU capacity through managed services following its Mirantis acquisition. Shorter-duration contracts could provide additional upside as IREN captures prevailing market prices, while software capabilities may increase revenue per deployment.
However, execution remains critical as IREN commissions new capacity and converts its 2027-2028 pipeline into attractive contracts.
How Are IREN’s Competitors Faring?
CoreWeave CRWV is seeing strong pricing for short-duration AI compute contracts. In September 2026, newly signed three-to-six-month contracts were priced at roughly $40 million of annualized revenue per MW, reflecting tight capacity. Contracted power rose to about 4.2 GW by Aug. 11, while its revenue backlog reached $104 billion.
Nebius Group NBIS is also benefiting from strong demand and higher pricing. Second-quarter AI-cloud deals averaged more than $20 million per MW, with four major contracts at $20-$25 million. Short-term deals in early third quarter indicated potential pricing of $40-$50 million per MW. About 70% of second-quarter deals included prepayments covering 50%-60% of capex.
IREN’s Price Performance, Valuation and Estimates
Shares of IREN have risen 18.8% over the past six months, outperforming the S&P 500 composite and the broader industry.
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In terms of forward 12-month Price/Sales (P/S), IREN is currently trading at 3.94X, which is at a premium to the industry average of 2.59X.
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Estimates for IREN’s fiscal 2027 earnings have been revised downward in the past week.
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Currently, IREN carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
