IREN’s Bitcoin Mining Output Plummets 80% as AI Cloud Revenue Takes Over
TREE NEWS reports: IREN (formerly Iris Energy) mined only 402 BTC in the last quarter, an 80% drop from 2,039 BTC in the same period last year. The company’s hashrate fell from 45.3 EH/s to 8.8 EH/s, and mining revenue plunged 88% to $28 million. Meanwhile, AI cloud services revenue reached approximately $200 million. IREN expects to substantially complete its exit from Bitcoin mining by December 31.
The Pivot to AI Infrastructure
The numbers tell a clear story: IREN is transforming from a Bitcoin miner into an AI cloud provider. The company’s strategic shift reflects a broader trend among mining firms seeking higher-margin, more stable revenue streams. Bitcoin mining is notoriously cyclical, with profitability hinging on BTC price, network difficulty, and energy costs. AI cloud services, by contrast, offer recurring revenue and long-term contracts.
IREN’s rapid decline in hashrate—from 45.3 EH/s to just 8.8 EH/s—is striking. It suggests the company is repurposing its energy infrastructure and data center capacity for AI workloads rather than mining. The $200 million in AI cloud revenue already dwarfs mining revenue, validating the pivot.
TeraWulf Follows the Same Path
IREN is not alone. TeraWulf reported Q3 revenue of $76.2 million, of which $63 million came from high-performance computing (HPC) leasing. The company has a 20-year, $19 billion lease agreement with Anthropic, the AI safety and research company. However, TeraWulf’s operating loss widened to $88.2 million, highlighting the capital-intensive nature of building AI infrastructure.
The Anthropic deal is a landmark for the mining industry. It demonstrates that Bitcoin miners possess valuable assets—land, power contracts, and data center shells—that can be repurposed for AI. As AI demand surges, these assets become increasingly strategic.
Industry Implications
- Revenue diversification: Miners are reducing exposure to Bitcoin’s volatility by embracing AI cloud services.
- Energy arbitrage: Miners with low-cost power contracts are well-positioned to serve AI data centers.
- Capital requirements: The transition requires significant upfront investment, as evidenced by TeraWulf’s widening losses.
- Competitive landscape: Traditional data center operators may face new competition from crypto miners.
Forward Outlook
IREN’s exit from Bitcoin mining by year-end marks a symbolic moment: a major miner abandoning the business that defined it. If AI cloud revenue continues to grow, IREN could become a pure-play AI infrastructure company. TeraWulf’s massive Anthropic lease suggests demand for AI compute is insatiable.
However, risks remain. AI cloud services require different expertise than mining, and competition from established cloud providers is fierce. Moreover, the capital intensity of building AI data centers could strain balance sheets. Investors will watch whether IREN and TeraWulf can execute this pivot profitably—or whether they are trading one volatile business for another.
