Microsoft has concluded a $9.7 billion deal with data center operator IREN, which includes access to advanced NVIDIA chips, in a move aimed at alleviating the computing crisis that has hindered the company from fully benefiting from the artificial intelligence boom.
IRN shares jumped by more than 20% in pre-opening trading on Monday, while shares of Dell, which specializes in artificial intelligence servers, rose by 5%, as it will provide IRN with GB300 chips from Nvidia and other equipment that Microsoft will use at a value of approximately $5.8 billion.
The five-year deal reflects the growing demand in the artificial intelligence sector for the computing power needed to run applications such as GBT Chat. It comes after major technology companies’ earnings reports last week that showed that a lack of absorptive capacity limits their ability to fully benefit from the artificial intelligence boom.
Cooperation with IRN will allow Microsoft to expand its computing capabilities without the need to build new data centers or secure additional power sources, which are two of the most prominent obstacles that slow down meeting the growing demand for artificial intelligence services.
IREN said Nvidia’s processors are scheduled to be deployed in phases through 2026 at its 750-megawatt campus in Childress, Texas, along with new liquid-cooled data centers designed to provide about 200 megawatts of critical IT capacity.
IRN said in a statement that the advance payment from Microsoft will help finance part of the Dell deal, worth $5.8 billion. Its contract with Microsoft may be canceled if delivery dates are not adhered to.
Microsoft’s chief financial officer, Amy Hood, said last week that the company now expects the crisis in its artificial intelligence capacity to continue until at least mid-2026, after previously predicting that it would improve later this year.
