Why Is IREN Stock Down In Premarket Today?

• IREN stock dropped over 2% in Monday’s premarket session.
• Iren’s Nvidia tie-up overshadowed a significant revenue shortfall and widening losses, partly due to a recent decline in the Bitcoin price.
• Stocktwits sentiment for IREN was ‘extremely bullish’ on Monday.

IREN Ltd. shares fell 2.3% in early premarket on Monday after Friday’s sharp rally, marking a brief pause in what has otherwise been a stellar run for the stock. Still, retail sentiment remained “extremely bullish.”

Shares had gained 7.7% on Friday after the company released its third-quarter earnings and disclosed an investment by AI chip giant Nvidia. 

The Bitcoin-miner-turned-data-center operator said Nvidia purchased warrants to invest up to $2.1 billion in the company as part of a deal in which IREN purchased Nvidia’s AI servers and offered it cloud capacity for rent. Nvidia will spend up to $3.4 billion over the next five years on cloud services from IREN.

The tie-up overshadowed a significant revenue shortfall and widening losses, partly due to a recent decline in the Bitcoin price, which raised concerns among traders.

IREN shares gained 34% last week, and have roughly doubled in the 30 days.

Retail View On IREN Very Bullish

On Stocktwits, the retail sentiment for IREN has been climbing in the last two weeks and was ‘extremely bullish’ on Monday. “Iren is clearly in a much stronger position now than when it was at $76 ATH (all-time high), buy all the dips, accumulate,” a trader advised. 

Some investors questioned the dip, but the broader view leaned towards accumulating the stock.

IREN Q3 Results Recap

Iren reported $144.8 million in revenue for its fiscal third quarter, falling short of Wall Street's estimate of $220.2 million and below the $184.7 million in Q2. 

The company's net loss of $247.8 million also deepened from the previous quarter's $155.4 million. Wall Street analysts were expecting $52.9 million in losses.

Iren also announced the acquisition of Spain-based Ingenostrum on Thursday, adding 490 megawatts of power in Spain. This brings IREN's total power portfolio to 5 gigawatts.

The Nvidia deal comes after IREN inked a $9.7 billion cloud deal with Microsoft last November. For the AI chip giant, it is only the latest investment-and-commercial partnership deal, similar to those it has struck with CoreWeave, Nebius and others.

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