Mark Cuban Warns Nvidia Is 'Funding Everyone' in the AI Boom. IREN Stock Proves His Point.

Mark Cuban recently offered a warning about how the artificial intelligence (AI) boom is being paid for. In a recent post on X, Cuban called Nvidia (NVDA) the sector’s initial public offering (IPO), “funding everyone and anyone.” His point was that Nvidia is now bankrolling a long list of AI companies, working similarly to how stock listings once funded young internet firms during the dot-com era. Few companies fit that description better than IREN (IREN). 

Nvidia is backing IREN in two ways. First, it holds a five-year right to buy up to 30 million IREN shares at $70 apiece. That would be an investment worth up to $2.1 billion if it goes ahead. Second, there is a separate $3.4 billion cloud deal, where IREN supplies Nvidia with GPU computing power over five years. That contract alone gives IREN a revenue floor of roughly $680 million a year.

To put that into perspective, the company’s revenue has fallen more than 20% sequentially in the last two quarters, with IREN reporting $144.8 million in revenue in its most recent quarter. So, a contract that brings well over half a billion dollars for the next five years is significant for a company of this size. 

The Catch Behind the Nvidia Deal

The problem is paying for the data centers behind these deals. During the last quarter, IREN spent roughly $1.36 billion on hardware, property, and equipment, which is more than nine times the revenue it brought in. That gap is the whole issue. IREN is spending far more on building out data centers than it currently earns. It has been filling the difference with outside money, including an equity raise of up to $6 billion to fund the expansion.

Moving forward, demand looks like less of a concern for the company. IREN has lifted its annual revenue run-rate target to $4.4 billion, and the Nvidia contract gives it years of booked income. What matters is whether it can keep raising money on good terms long enough to fund itself from its own cash flow. Nvidia’s $70 option is a sign of confidence, but with IREN stock currently trading near $42, it may be a while before the option gets exercised. The company does have half a decade, though, and the stock has traded as high as around $77 in the past year, so a return above the $70 threshold seems achievable. 

About IREN Stock 

IREN operates in the vertically integrated data-center business in Australia and North America. It operates and owns computing hardware, as well as electrical infrastructure and data centers. Its data centers are optimized for power-dense computing applications and support a combination of GPUs for high-performance computing (HPC) and AI services and ASICs for Bitcoin (BTCUSD) mining. IREN also mines Bitcoin, but has halted further expansion of its crypto-mining capacity. Founded in 2018, the company is headquartered in Sydney, Australia. 

Over the last 12 months, IREN stock has increased 138%, easily outperforming the S&P 500 ($SPX), which has climbed by 20% over the same period. The rise has been driven primarily by growing demand for AI infrastructure, the continued expansion of its data-center operations, and increasing confidence in the company’s AI cloud growth strategy. However, on a year-to-date (YTD) basis, IREN stock is up 12%, slightly underperforming the S&P 500’s 13% gain. 

IREN is extremely difficult to value by traditional measures. The forward price-to-earnings (P/E) ratio isn’t meaningful since the company isn’t consistently profitable. The forward price-to-sales (P/S) ratio of 15.4 times is a steep multiple on its own, but it also has no reliable long-run average to compare against. This is because the company is considerably reshaping itself in the AI cloud business. While the bulk of its revenue still comes from BTC mining, IREN’s AI cloud revenue increased 94% sequentially to $33.6 million in the third quarter of 2026 while BTC mining revenue decreased 34% sequentially to $111.2 million.

Meanwhile, the EPS outlook looks unsettled. Analysts don’t have a clear earnings trajectory for the next few years. The balance sheet isn’t exceptional, either; IREN holds $2.21 billion in cash against $3.96 billion in debt. That isn’t a heavy load on its own, but IREN is still spending far faster than it earns. Its valuation ultimately rests on funding staying available long enough for the business to stand on its own. 

IREN's AI Pivot Gains Momentum

IREN reported its Q3 2026 earnings on May 7. The quarter was disappointing with a loss per share of $0.30, missing the forecast for a loss per share of $0.21. Revenue also fell short at $144.8 billion, down 22% from the previous quarter. The company reported a net loss of $247.8 million, impacted by non-cash impairments and unrealized losses. These results highlight the company’s ongoing transition from Bitcoin mining to AI cloud infrastructure services. While AI cloud services revenue surged by 94% quarter-over-quarter, overall revenue declined due to a significant drop in BTC mining revenue. 

Despite the Q3 results, IREN has maintained a positive outlook for its AI cloud services. It expects annual recurring revenue to now be over $4 billion by the end of 2026. The company plans to reach 1.21 gigawatts of data-center capacity in 2027, and projects significant contributions from a Microsoft (MSFT) contract as well as additional GPU deployments in the coming quarters. 

What Do Analysts Expect for IREN Stock?

In July, H.C. Wainwright raised its price target on IREN stock from $85 to $90 and kept a “Buy” rating. The upward price target revision reflects impressive potential upside of 113% from current levels. The analyst firm revised its price target after IREN hiked its annual recurring revenue target and announced $2.8 billion of new multi-year AI cloud contracts with AI developers.

Based on 15 analysts with coverage, IREN stock holds a consensus “Moderate Buy” rating. Out of those analysts, 11 have a “Strong Buy” rating, three have a “Hold” rating, and one analyst has a “Strong Sell” rating. The average price target of $81.08 suggests potential upside of 92% from current levels.