IREN Tumbles By Over 10% Amid Meta’s Plan to Enter Cloud Business

Australia-based cloud infrastructure provider IREN has seen its stock fall by over 10% in a single day, continuing a grim streak of losses from June. The IREN stock freefall comes on the heels of reports that tech giant Meta is planning to launch a cloud business, threatening the profitability of established data center operators. 

IREN stock records double-digit loss as Meta enters its turf

IREN shed over 10% at the close of trading, settling at $38.82 and marking a grim start to July. The stock decline follows Meta’s decision to turn excess AI compute into cash, triggering a wave of panic among IREN holders.

Sources say that Meta is building a cloud business, a move that will see it compete with established industry players like IREN. Meta is reportedly weighing two business models, mulling the sale of raw computing power or selling access to AI models hosted on its infrastructure.

The incoming outfit, dubbed Meta Compute, is tipped to become an industry market leader, potentially compressing rental margins for other cloud providers. Meta’s move into cloud infrastructure could send its stock on a tear after JPMorgan predicted an $825 price by the end of the year.

Meanwhile, SoftBank and its telecom arm are entering the race with plans to launch AI cloud services in the US. Both entities will float SB Neo later this month, offering AI compute to US-based technology companies.

While IREN bore the brunt of reports of new industry competitors, other data center operators and cloud infrastructure providers also recorded major stock declines. CoreWeave (CRWV), Nebius (NBIS), and Cipher Digital lost 4.59%, 5.92%, and 11.97%, respectively.

Furthermore, the semiconductor index SOX lost 5.4%, continuing an industry-wide decline. However, the Dow Jones Industrial Average rose by over 2% while the Nasdaq climbed 2.1% during the week in a reverse trend.  

The latest decline continues a long streak of losses for IREN, with the cloud infrastructure provider stock recording a weekly drawdown of 20.17%. On the monthly chart, IREN has lost a massive 40%, coming within touching distance of erasing all of the gains from 2025.

IREN has even bigger problems than Meta

Short seller Jim Chanos noted that IREN investors are still coming to terms with a large payout to its co-CEOs, William and Daniel Robert. A regulatory filing emerged after the Meta news, revealing an $800 million restricted stock unit (RSU) grant to the duo, sparking concerns among investors.

Iren had previously diluted its equity base through a convertible note offering to advance its data center ambitions. Still reeling from the dilution, an almost $1 billion stock grant to both CEOs has left a sour taste in the mouths of retail investors, triggering mass offloading by IREN holders.

Meanwhile, IREN has received criticism over a multi-million-dollar sponsorship deal with the Golden State Warriors. Critics argue that the company should funnel funds toward expanding its data center footprint rather than sports sponsorship deals.

On the technical side of things, IREN is grappling with heavy selling pressure after prices fell below its major moving averages. At press time, the stock’s relative strength index (RSI) is at 31, signaling that it is not yet oversold and a steeper drop is on the cards.