The balance sheet is expanding at a pace the underlying business is nowhere close to matching.
Capex and debt behind the gap
Two items account for most of the increase. TTM capital expenditure rose 422.8% year over year to $3.0 billion, equal to 424.0% of the $707.0 million in revenue the company generated over the same twelve months.
Gross margin held at 68.9% over the trailing twelve months. That contrast matters for how the operating-margin figure should be read: a widening loss driven by rising fixed costs tied to a build-out carries different implications than one driven by weaker unit economics in the core business, though the filings used here do not allow a clean separation between the two.
Margins and cash flow
TTM operating margin fell to 148.0%, down 151.5 percentage points from a year earlier, and net margin fell to 99.4%, taking net income over the period to −$702.6 million.
| Metric | TTM figure | Change year over year |
|---|---|---|
| Total assets | — | +437.0% |
| Revenue | $707.0 million | +41.1% |
| Capital expenditure | $2,998.0 million (424.0% of revenue) | +422.8% |
| Long-term debt | 47.0% of total assets | — |
| Operating margin | −148.0% | −151.5 pp |
| Net margin | −99.4% | −116.7 pp |
| Free cash flow | −$897.6 million (−127.0% margin) | −61.6 pp (margin) |
| Diluted shares outstanding | — | +41.6% |
Earnings against expectations
None of this changes what the underlying numbers show. Net income over the trailing twelve months came to −$702.6 million, a net margin of −99.4%. Whatever gets said about near-term results, the margin figures above describe a business still some distance from a profit.
What the filings don't show
What the new assets consist of, whether data-centre infrastructure, computing hardware or some combination, is not identified in the structured filing data used for this analysis; that detail sits in the 10-K's narrative sections rather than in the reported numbers. Readers tracking the build-out in more detail can find IREN's full financial history on its company page.
What it means for value
IREN's free cash flow margin fell to −127.0% on a trailing basis, down 61.6 percentage points from a year earlier. Our model uses that figure as a direct read on how far the business is from funding its own capital programme out of operating cash rather than from new debt or equity; a margin this far below zero means the model's valuation for IREN still depends on revenue growing into the asset base, not on cash the business generates today. These are model values under stated assumptions, not a comparison with the share price.
