AI compute stocks bounce as Hut 8, IREN land billions in new contracts

Shares of companies involved in AI computing infrastructure experienced significant gains following announcements of large multibillion-dollar contracts. Hut 8's stock jumped up to 17% after it signed a 15-year lease valued at $9.8 billion for the second phase of its Beacon Point AI data center campus in Texas. This lease doubles the footprint of the customer to 704 megawatts (MW) and fully commercializes the site's planned 1 gigawatt capacity, involving the same investment-grade tenant from the first phase.

IREN also saw its shares rise as much as 19% after revealing $2.8 billion in new multiyear cloud services agreements with AI developers. The company raised its year-end AI Cloud annualized run-rate revenue target to over $4 billion, stating that about 85% of this revenue is now secured under contract. These substantial deals helped alleviate investor concerns about a potential slowdown in demand for AI computing power.

The optimism extended beyond Hut 8 and IREN to other players in the sector. Shares of AI infrastructure providers such as Cipher Mining and TeraWulf gained 11% and 6.4%, respectively. Bitcoin miners transitioning into AI infrastructure including Riot Platforms and MARA Holdings rose 5% and 9%, while the CoinShares Bitcoin Miners ETF increased 8.5%. This rally occurred after a recent period of investor caution sparked by reports of more efficient open-source AI models from Chinese firms and speculation that Meta Platforms might enter AI cloud service provision, which had raised concerns about excess supply impacting data center operators.