Microsoft Inks $9.7 Billion Deal with IREN for Nvidia Chips

Microsoft has signed a $9.7 billion, 5-year agreement with data centre operator IREN to gain access to Nvidia’s GB300 processors. The deal is aimed at meeting the growing computing requirements for artificial intelligence projects and cloud services.

Deployment Plan

The Nvidia chips will be installed in phases until 2026 at IREN’s 750-megawatt Childress campus in Texas. The facility includes new liquid-cooled data centres that will provide around 200 megawatts of IT capacity. IREN operates several data centres across North America with a combined capacity of 2,910 megawatts.

Financial Details

Microsoft will make a 20% prepayment under the contract. IREN said part of this will be used to support its $5.8 billion agreement with Dell Technologies, which will supply Nvidia chips and supporting equipment. The company also stated that Microsoft can terminate the contract if project timelines are not met.

Other Partnerships

Earlier this year, Microsoft signed a $17.4 billion deal with Nebius Group for additional AI infrastructure. Similar partnerships with “neocloud” providers like IREN and CoreWeave have become common as cloud computing demand grows across the industry.

Context

Demand for computing infrastructure has increased sharply as companies expand AI applications. By partnering with IREN, Microsoft can add capacity without building new data centres or securing additional power sources. The arrangement also helps reduce upfront spending on hardware that may become outdated as new chip models are released.

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Conclusion

The deal with IREN allows Microsoft to access large-scale Nvidia computing resources over the next few years while managing the industry-wide strain on data centre capacity.

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