$IREN: The Most Realistic Market

Microsoft's Focus on Software not IaaS
This Satya Nadella interview shows that Microsoft is lazer focus on going after the long tail of enterprises with their full AI Cloud Platform in Azure. Although today, MSFT has alot of bare metal revenue due to OpenAI, bare metal will not be their primary focus in the long term.

Microsoft's Renting of GPU is not Lack of Planning, It's Strategy
Satya make's it clear that Microsoft gave up it's leads on multiple datacenter sites (1). We see Google announcing a 40B commitment to building DCs, yet Microsoft is giving up some sites and renting from $NBIS, $IREN, $CRWV. Why's that?

Satya sees the PaaS/SaaS as a extremely competitive layer going forward. MSFT wants to build their own model as their OpenAI API rights end in 7 years and want to dominate with Azure, Office365 and the agent orchestration layer. At the same time they want to lighten the capex blow that even META is being punished by the markets for. By partnering with bare metal GPU IaaS, Microsoft is going more laser focused on PaaS/SaaS. PaaS is the domain of the giants as GCP, AWS, Databricks, FireworksAI, NBIS co-competitors and Copilot has been losing market share to Cursor, Claude Code, Codex, and the long tail of Vercel, Congition, Replit, Loable.

Satya has stated that the main long term bare metal provider is $ORCL which matches my understanding of $ORCL.

This invalidates a large bear case for IREN:
1. False: Hyperscalers will not need bare metal providers in a few years.
1a. Trend: Lightening up on the bare metal side allows MSFT to pour more capex into the PaaS/SaaS layer. As the competition grows, others will join in the game. Look at META, they will be renting bare metal from $CRWV.

I'll acknowledge that in what I view as a very uncertain outcome that $NBIS does out compete all these hyperscalers and other AI platforms, they have the most upside. But knowing how competitive PaaS is, I'm glad $IREN is focusing IaaS where they have the GWs to scale revenue to make the total profit be amazing at the end of the day. Bare Metal GPUs is responsible for ~$300B-400B of ORCL's market cap.

Thanks for @cryptomiami1 for the lead on this video:
(1) youtube.com/watch?v=8-boBs… Satya keeps talking about how he doesn't want to get stuck on one generation of GPUs, but he's signing 5 year leases with $IREN, $NBIS which is the entire useful life time of GB300s.

Although I think there will be residual value, you get the point, 5 years is enough for MSFT to buy the GPUs themselves.

First take notes on $IREN Q3 Earnings (Thread)
- 140k GPU expansion by end of 2026, conservative figure as includes Horizion 1-4 MSFT contract and 63k GPUs in Canada. H5-10 and SW not included. Clues of 50MW extra at PG and Childress 50MW expansion. - Official announced multi-GW development pipeline for first time.