IREN Just Borrowed $363M Against Its Nvidia GPUs. Here’s Why

Iren enclosed $363 million of refinancing of deployed GPUs with Wingspire, according to a press release this morning, Wednesday. The financing is securing principal is secured principally by GPU servers and network gear, which is already deployed and generating revenue. Iren share price closed at 27.44 on Tuesday, down 27.35% year to date after a tremendous 2025 where it gained 284% in the year.

This might look like a small deal, and in terms of financing, it is, but it's also notable for a few reasons. First, why it's small. In August, Iren said during its earnings call that they needed at least 25 to 30 billion dollars to to see that uh come to life and $300 million doesn't do a lot there.

It's also notable because Elon Musk recently said that the financing market for neo-clouds is basically gone. Quote, as of Sunday, as of the past few weeks, debt markets have almost entirely shut off access to money for any company that doesn't have substantial revenue independent of AI data centers. SpaceX closed 40 billion of debt from GPUs, but we're investment grade and have Starlink and launch revenue. That means the 200 plus neo clouds are going to see guppy level death and consolidation. Some will make it through, but not many. End quote.

Charlie, got to ask the question, is Elon wrong? Is he manipulating markets again?

Is Elon ever wrong or is he ever right? I mean it's a little bit of both. I'm gonna say both and. Look, Elon talks his own book. We know this. He makes projections which shock you and occasionally he delivers on those. Um, he said there's 200 plus neo clouds. Now I could probably personally name like 30. There's probably more, there's definitely more than that. Um, but we do know there's just going to be a lot of disappointed investors, there's a lot of disappointed clients. There's going to be a lot of GPUs collecting dust once deliveries start coming in Q1 of 2027.

But my question is like, does Iren specifically, are they stuck holding the bag? Um, I would say they're much higher on the totem pole than some of these other companies that I I couldn't name less, less maybe even haven't even heard of. So like, they're in a much better position here and so I'm trying to fend off the Iren haters because I can see them furiously typing in the comments right now as I speak.

Yeah, I mean, we got a few of those and we've certainly taken some heat from some Iren fans over the last few weeks covering some of the news. The gist of it is like the stock has not done super well this year compared to last year and so we we've seen a lot of investors get a little spooked by that CAPEX number. I said earlier, I think what you're seeing right now though is the maturity of the debt stack for a company like Iren. So, if we look at the broader picture, especially from the the late earnings call, they forecast that again, that 25 to 30 billion in CAPEX. They have about $14 billion on hand in cash as of the last earnings call in August. And then they also have the ability to debt finance their builds once they're finished or use debt from their builds, I should say.

So, you know, they have the Sweetwater sites or the Childress sites and this looks like maybe the the Prince George site, I think is is probably what they're referring to here in this notice. They're basically going to like reverse mortgage that in a sense and be able to get cash back from it and then use that to continue to build out their vision of this verticalized AI neo-cloud. To Elon's point, it does help a lot when you have Starlink revenue, launch revenue, or you know, anything else. Maybe if they merge one day with Tesla, they'll have Tesla revenue. And then you're able to get better uh investment grade uh benefits from having more revenue than just like what you're reinvesting in, which at the end of the day for Iren is energy, land, and GPUs.

Yeah, here's the tweet from Elon. I mean, this went giga viral. It was in response obviously to Chamath. Um, Iren Chart Will, look at this, down on the day. It looks like it started the morning at what, like 28 down to 27. So market initially not a fan of this, which I don't really understand why. Maybe that that's animal spirits.

Well, I mean I would just zoom out like this is a drop in the bucket of what they need for capx spending. So if they came out with a much larger deal, look at the the Cypher note right their convertible note a few weeks ago, 850 million and that really spooked the market because there was some rationale for needing that convertible note, but it was also at a bad time.

I think like a smaller financing plan like this it's fairly vanilla at the end of the day, like they already have those GPUs on hand, they're humming along. I think it's like pulled together or it's Together AI uh and some other companies that they're uh using already have those least out. So they're already making money on this. They're just you know, using that money to go get credit and make more money. A few comments to see Fairfax says, but can they triple net lease? Uh unsure if they triple net on all these, a lot of times that happens during the initial tenant agreement and for uh Iren here, they're not always going to go that decision to be kind of like a landlord. They're going to own everything, all the infrastructure, pay for itself and then get some sort of deal like they did with Microsoft, right? Where like Microsoft is coming in and using the GPUs that Iren builds. It's different than say like a Clean Spark build where Clean Spark is just like the tenant owns the power and the land but they don't own the GPUs and there can be like a few differences there. But

I think uh and they Fairfax adds up similar to Ionic. I think that's probably fair. I haven't looked into Ionic since the summer. But I think in general Charlie, going back to it, we have a Fed decision today. This wasn't a huge notice from Iren. Year to date it's it's down. They got a little bit of uh execution before we see any more growth in the stock, I think for the moment. but not not to say it'sish just like there's more to come.

Yeah, I mean, any any few pennies you can scrounge up, maybe you call 363 million pennies these days in the scale of things. You know, whatever cash you can have on hand to front these deals and put towards projects the better. So cash is king, an investment grade is uh the usurper. So, um, we are going to keep