Microsoft has signed a massive deal with Sydney-based Iren. Picture: Getty Images via AFP <\/p>\n
An Australian owned and operated data centre provider \u2014 founded by two former Macquarie banker brothers \u2014 has entered into a billion-dollar agreement with technology powerhouse Microsoft.<\/p>\n
In a deal announced overnight, Microsoft will pay Iren $US9.7bn ($A14.8bn) over the next five years in return for artificial intelligence computing power.<\/p>\n
Microsoft has become Iren\u2019s biggest customer.<\/p>\n
Shares in Iren leapt 11.52 per cent overnight to $US67.75 following the announcement.<\/p>\n
Iren shares leapt following the announcement with Microsoft. Picture: Supplied <\/p>\n
Brothers Will and Daniel Roberts founded Iren as Iris Energy amid the bitcoin mining boom in 2018. They later switched to AI services in a move that has made them two of the richest young men in Australia.<\/p>\n
Iren will provide Microsoft with access to Nvidia computer systems in Texas specifically designed for AI work. Microsoft will pay 20 per cent of the contract value upfront.<\/p>\n
To deliver on the contract, Iren will purchase advanced computer chips and equipment from Dell Technologies for $5.8bn.<\/p>\n
It follows earnings season in the United States, where tech titans Apple, Microsoft, Alphabet, Amazon and Meta all forecasted a massive investment in artificial intelligence and data centres over the next few years.<\/p>\n
Combined, these five businesses will invest $US380bn ($582bn), in capital expenditure.<\/p>\n
Microsoft chief executive Satya Nadella told investors last week during an earnings call that the company expects to double its data centre footprint over the next two years, \u201creflecting the demand signals\u201d for AI.<\/p>\n
Microsoft has signed a massive deal with Sydney-based Iren. Picture: Getty Images via AFP <\/p>\n
Iren is among the data centre operators known as neoclouds, a new generation of cloud providers that specialise in advanced computing including artificial intelligence.<\/p>\n
Monday\u2019s announcement is the latest for Microsoft as it inked several multi-billion dollar deals with data centres across the world.<\/p>\n
In October the technology giant announced deals with Neibus, Nscale, CoreWeave and Lambda which combined is tipped to be worth $US33bn ($50.5bn).<\/p>\n
The business says it will use existing cash, customer prepayments, operating cash flows and additional financing initiatives to fund the deal.<\/p>\n
Iren co-founder and co-chief executive Daniel Roberts called Monday\u2019s partnership a major milestone for the company.<\/p>\n
Daniel Roberts (R) exec chair and co-founder Iris energy with his brother Will Roberts co-founder Iris energy, photographed outside Chifley Square in Sydney. Britta Campion \/ The Australian <\/p>\n
\u201cThis agreement not only validates Iren\u2019s position as a trusted provider of AI cloud services but also opens access to a new customer segment among global hyperscalers,\u201d he said.<\/p>\n
Iren estimates once the deal with Microsoft is fully implemented it will generate $US1.94bn ($A2.97bn) in annualised revenue while taking up about 10 per cent of Iren\u2019s total capacity.<\/p>\n
The business says it will leave room for the infrastructure provider to sign additional contracts.<\/p>\n
\u201cIt marks another major step forward for Iren as we continue to expand large-scale GPU deployments across our 3GW secured power portfolio in North America, reinforcing our position as a leading AI cloud service provider,\u201d Mr Roberts said.<\/p>\n","protected":false},"excerpt":{"rendered":"Microsoft has signed a massive deal with Sydney-based Iren. Picture: Getty Images via AFP An Australian owned and…\n","protected":false},"author":2,"featured_media":266761,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[256,254,255,64,63,155834,10166,155835,2577,105],"class_list":["post-266760","post","type-post","status-publish","format-standard","has-post-thumbnail","category-artificial-intelligence","tag-ai","tag-artificial-intelligence","tag-artificialintelligence","tag-au","tag-australia","tag-daniel-roberts","tag-data-centre","tag-iris-energy","tag-microsoft","tag-technology"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/266760","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=266760"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/266760\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/266761"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=266760"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=266760"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=266760"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}