IREN Stock Falls 6.3% as Debt-Funded Data Centers Sell Off…
By Tobi Opeyemi Amure
AI summary of the source article
Shares of IREN dropped 6.27% on 7 October to close at $38.69, falling significantly faster than the broader Global X Data Center and Digital Infrastructure ETF. The decline occurred without any company-specific announcement, driven instead by broader pressure on firms heavily reliant on debt to build AI compute capacity as the 10-year Treasury yield hit 5.3%. Sector peers TeraWulf and Core Scientific also dropped 5%. With $3 billion in convertible notes and a net loss of $702.62 million surpassing annual revenue of $691.33 million, IREN's high leverage and 2.92 beta left it vulnerable to rising borrowing costs.
Why it matters
Rising interest rates are penalizing AI infrastructure providers that rely heavily on debt rather than operational cash flow to finance rapid data center expansions.
Key facts
- IREN closed down 6.27% at $38.69 on 7 October, underperforming the sector ETF which fell only 0.4%.
- IREN booked a net loss of $702.62 million against revenue of $691.33 million in its last full year.
- The company carries substantial debt, including $3.0 billion of 1.00% convertible senior notes due 2033 and 3.50% notes due 2029.