Microsoft signed a $9.7 billion contract with a company from Australia. Its securities rose
Microsoft, which is among the leaders of the global race in the field of artificial intelligence, has signed a contract for the purchase of computing power with the Australian company IREN for about $9.7 billion. IREN, in turn, has agreed to purchase equipment from Dell. After the news, Iren's shares hit a record high, while Dell's shares reached a 1.5-year high.
Details
IREN will provide Microsoft with access to Nvidia's GB300 GPUs for a five-year term. The contract includes an upfront payment of 20%. In parallel, the Australia-based company will purchase about $5.8 billion worth of GPUs and related equipment from Dell. IREN plans to secure the necessary capital expenditures through cash, prepayments to Microsoft, operating cash flow and "additional financing initiatives," its statement said.
IREN securities, traded in the USA, at the beginning of trades on November 3 jumped by almost 25% up to $75.73, which became a record for them for the whole time of circulation. After that, the value of the securities decreased: at the moment of publication of this text they were 6% more expensive.
Dell shares hit their highest since late Ma - early June 2024 after the stock exchange opened. At the peak of the day they cost $168.08. Shares of Microsoft at one point rose by 1.4%, but then lost almost everything gained: they added only about 0.2%.
Context
Over the past year, Microsoft has signed a number of agreements with suppliers of computing power necessary for the operation of artificial intelligence, including Nebius, which is headed by Yandex co-founder Arkady Volozh. Microsoft needs such deals to keep up in the AI systems race, Bloomberg writes. In late October, after the report, the company said it still lacked the capacity to meet demand for its cloud services, the agency added.
Microsoft said on Nov. 3 that it was the first to receive permission from the U.S. Department of Commerce to supply AI chips from Nvidia to the UAE. The decision paves the way for the expansion of the corporation's multibillion-dollar investments in the Gulf region, the Financial Times noted.
This article was AI-translated and verified by a human editor
