The fourth quarter of fiscal 2026 (ended June 30) was a landmark for IREN: revenue from AI cloud services exceeded bitcoin mining income for the first time. The company recorded $70.5 million from the AI segment versus $66.7 million from mining. This is not just a shift in numbers on a report, but an indicator of a deep business transformation that has already begun to impact financial performance.
The transition to AI Cloud came at a significant cost: the net loss for the quarter was $684 million, of which $450.4 million was non-cash asset impairment, primarily due to the decommissioning of mining equipment. Total quarterly revenue declined 5% to $137.2 million, but the structure changed radically: the AI segment doubled from $33.6 million, while mining fell 40%—from $111.2 million to $66.7 million.
Adjusted EBITDA dropped 68%—from $59.5 million to $19.2 million. The company attributes this to rising personnel costs and investments in the platform ahead of the anticipated AI Cloud scaling. The market reacted predictably: shares moved lower in pre-market trading.
The sector as a whole: TeraWulf, Cipher, and Riot
TeraWulf posted $44.8 million in revenue in the second quarter, with $31.9 million (71%) coming from leasing capacity for high-performance computing (HPC). Mining brought in just $12.8 million, compared to $47.6 million a year earlier. The Lake Mariner campus had 81 MW of critical IT capacity at the end of June, and after the commissioning of a new building on July 6, the figure rose to 102 MW. However, HPC has not yet pushed the company into profitability: adjusted EBITDA turned negative at $18.3 million, and the net loss reached $939.9 million, mainly due to a non-cash change in the fair value of warrants of $755.7 million.
Cipher Digital is still lagging: the new infrastructure generated no revenue in the second quarter, with all $24.8 million in income coming from mining. Adjusted EBITDA was minus $30 million, and the net loss was $267.5 million. The first capacity of the Black Pearl data center only began being handed over to the customer in August, with lease payments starting from that point.
Riot Platforms is already reporting data center revenue, but it remains modest: $23.2 million out of total revenue of $174.2 million. Mining brought in $113.7 million, and engineering contributed $37.3 million. However, only $4.9 million came directly from lease payments, with the remaining $18.3 million from infrastructure preparation services.
These reports confirm a steady trend: public miners are broadly pivoting toward AI infrastructure, drawn by demand for energy-intensive sites. But for now, this transition carries significant costs, and profitability is a question for the coming quarters.
My view: the market is already pricing into these companies' valuations not so much current losses as the potential of future AI contracts. However, investors should closely monitor the pace of capacity deployment and real monetization—otherwise, the gap between expectations and actual figures could become painful.