IREN data center project in Texas faces delays due to Microsoft requests

IREN, a cloud services provider, reported that its flagship data center project in Childress, Texas, is facing delays. The company attributed the setback to network equipment changes requested by Microsoft to support newer AI models.

The project is part of a five-year, $9.7 billion contract with Microsoft involving four phases, known as Horizons, each providing 50 MW of capacity for liquid-cooled NVIDIA systems. While the first phase was completed and accepted in August 2026, the subsequent phases, originally targeted for completion by Q4 2026, may now slip into Q1 2027.

Microsoft confirmed during an earnings call that it reduced its 2026 capital expenditure forecast by $5 billion due to delays at third-party cloud provider sites. Beyond the network requests, the project has also encountered equipment shortages and a generator fire. IREN co-CEO Daniel Roberts stated that the company maintains an excellent relationship with Microsoft, though the company has adjusted its timeline for reaching $4 billion in annual recurring operating revenue to early 2027.