Microsoft signs $9.7bn, five-year IREN deal to secure GB300 AI processors
IREN to deploy GB300s at Childress, Texas, with 200 MW liquid-cooled halls
Microsoft prepay and Dell $5.8bn equipment pact accelerate capacity through 2026
Microsoft has struck a five-year, $9.7 billion agreement with data-centre operator IREN that guarantees the software giant access to Nvidia’s next-generation GB300 AI processors. The move is designed to relieve a severe shortfall in AI compute capacity that Microsoft warned could last into mid-2026.
Under the arrangement IREN will source GB300 GPUs and related infrastructure, deploying them at its Childress, Texas campus as part of a phased rollout through 2026.
The company also signed a separate roughly $5.8 billion equipment purchase deal with Dell to supply those systems, and the Childress expansion will include new liquid-cooled halls expected to deliver about 200 megawatts of critical IT capacity.
Market Reaction
IREN’s US-listed shares jumped sharply in pre-market trading after the announcement, with several outlets reporting rallies of more than 20–25% as the market digested the supply and sales visibility the contract provides. Dell also rose on the news, which underscored the supply chain implications for server vendors.
The commercial terms include an upfront component, Microsoft will make a significant prepayment (reported at about 20% of the contract) that IREN says will help finance its equipment purchases tied to the Dell agreement; the Microsoft contract is, however, conditional on IREN meeting delivery and timeline milestones.
Deal’s Significance
Major cloud providers are racing to secure GPU capacity as demand from generative-AI workloads outstrips available machine inventories. Microsoft has publicly warned the industry’s capacity shortage will persist into at least mid-2026, making third-party capacity arrangements like this one a faster way to scale compute than building new data centres or buying chips that quickly depreciate.
The deal also helps Microsoft avoid some heavy up-front capital exposure while locking in a steady supply of increasingly scarce GPUs.
Market participants will monitor IREN’s execution against delivery milestones (which could trigger termination rights), the pace of GB300 deployment at Childress, whether other hyperscalers follow with similar capacity deals, and how the arrangement affects GPU availability and pricing across the industry.
The extent to which Microsoft’s prepayment finances the Dell purchases and the timing of rolling capacity into Microsoft’s cloud services will determine how quickly the company can relieve its compute bottleneck.
