IREN to buy Blackwell systems from Dell for about $1.6 billion
Microsoft MSFT | 0.00 | |
IREN IREN | 0.00 | |
NVIDIA Corporation NVDA | 0.00 | |
Dell Technologies DELL | 0.00 |
May 26 (Reuters) - Data center operator IREN IREN.O said on Tuesday it has agreed to buy Nvidia's NVDA.O air-cooled Blackwell systems from Dell DELL.N for about $1.6 billion, as it aims to bring more capacity online to keep up with soaring AI demand.
The deal is to service its previously announced five-year $3.4 billion cloud AI service contract with Dell, an AI server maker, IREN said in a statement.
The Blackwell systems will be set up across existing data centers at IREN's Childress, Texas, campus, and are expected to be ready by early 2027.
Upon commissioning, the contract is expected to increase IREN's annualized run-rate revenue (ARR) to $4.4 billion from $3.7 billion, reflecting ongoing progress in bringing GPU capacity online.
The purchase price of $1.6 billion covers all equipment and services, including GPUs, servers, storage, networking, ancillary equipment, integration services and warranties, with payments made after delivery, IREN said.
"Securing capacity and accelerating commissioning are our top priorities in a market where time-to-compute is everything," according to IREN Co-CEO Daniel Roberts.
Separately, Nvidia said earlier this month that it would invest up to $2.1 billion in IREN, as part of a broader deal to deploy up to 5 gigawatts of infrastructure.
In November, Microsoft struck a $9.7 billion deal with IREN that includes access to Nvidia's advanced chips.