$iren Earnings Reaction 2.5.26

Hosted by @₿itcoin ₿utcher 🥩 🐑 🐷 · 2026-02-03 · Tags: IREN

TLDR

Participants viewed IREN's severe post-earnings selloff as painful but largely disconnected from an earnings call that improved the company's long-term AI infrastructure case. They highlighted low-cost GPU financing, a 1.6-gigawatt Oklahoma site, confirmed Sweetwater power approvals and accelerating AI demand, while acknowledging execution risk, disappointing quarterly cloud revenue and the urgent need to secure another major customer.

Speakers

Notable quotes

Transcript

₿itcoin ₿utcher: 902, so let's kick things off. Thursday, February 5th, 2026, following the iron earnings call. I didn't listen to it live. I saw some of the text from some people, initial reactions. But I just had a chance actually right now to take a step back, went to the gym, get a lift in, and listen to the call for what it was and not react to pricing in real time, which I think I just saw 34 and a half, which beats the 29 that we saw an hour or two ago. And I personally chalk that up more as to a sigh up after hours just trying to mess with people's confidence, which it clearly worked. So let's address that negative piece on the front end. Price action sucked. There's a lot of people who have margin and options adversely impacted, including myself. I have a little runaway with May, but so I do feel for people and But at the same time, you have to be able to separate what's happened with where we're going. And after listening to that call, I feel like management's still on track, and this isn't broken. I mean, we just had Bitcoin down, I think, 12% today, or at least 11%, low 70s down to 63. and all AI-related stocks, regardless of their Bitcoin mining affiliation, got hit pretty hard. So it appears to be a repositioning by Wall Street traders, hedge funds, whoever they are. But at the same time, now they've knocked it down so low where these valuations, given the business updates, are pretty attractive now. So I personally Expect to see if it's not tomorrow in the coming week or two. After these institutions have reacquired their desired positions at these lower prices. I'm expecting a few upgrades for iron specifically related to some of the updates that I'll briefly talk you through. I just have a list of notes like I said from the call so. Don't mind if I read through these briefly, not line by line, but just looking at my notes. First thing that they highlighted was the $3.6 billion GPU financing for less than 6%. That, along with the prepayment, handles 90% of the funding obligation for the GPUs associated with Microsoft. So let me stop there for a second. Anthony Lewis is able to secure financing for GPUs, but we're in an AI bubble. That doesn't sound like that makes sense to me. And then I see the funding from, excuse me, the note offering yesterday from Cipher, and they were able to attract very good terms. Granted, it was for data center and for co-location, but it's still the same sector and it still relates to AI data centers and they were able to borrow for 6 and an eighth and those bonds today were trading and they've already traded up in price, meaning their yields If the bond price is up, the yield goes down. That yield might be below 6% now. I haven't had a chance to look at that, but also an encouraging development. And also, the earnings today with Amazon expanding their CapEx to well over $200 billion pairs well with Google expanding from $120 to $180 billion. Even if it is a bubble, the bubble's getting bigger before it pops. We're not there yet. There's still some runway here. And the companies that are fueling it have operations that generate cash flow that they're redirecting those cash flows into their CapEx. And they do have runway and they do have profitable businesses. So that gives me reason to believe that We have a few more quarters at a minimum before you would see anything. And then you look at the earnings reports of the high bandwidth memory providers. We have to wait on Nvidia. AMD got smacked, but their earnings, they increased 39% related to data centers. So again, when you look at the earnings calls and take a step back from your Robinhood app or Charles Schwab, whatever you use, like if you read it by itself, you'd feel pretty good about where we're at. Moving on, I noticed they were talking about hypers and enterprise clients being open to using air-cooled GPUs. Franz is able to join us later, someone else can maybe speak to it. But I think that's specifically referencing McKenzie, if I had to guess. and not Childress, but I didn't really ask a good follow-up on that, but that was my initial reaction is Mackenzie may be sold or a larger contract will be sold to an enterprise or a hyperscaler. And because of the smaller retrofit, that's a few $1,000,000 a MW versus reconstructing they can get capacity online sooner, which is advantageous in this environment. One thing I was disappointed with was Prince George for the quarter. The cloud revenue, it wasn't made clear if they had them installed by the last day of the year, but they only increased from 7 million the prior quarter to 18 million and a run rate of, you know, if you multiplied by 12 and they were at 20 million, that would have been 240. Well, they only had 18 for the whole quarter. Now, the way they would define it is they'd say the last day of the year we had them installed and maybe we only got one day's worth. We can argue about that, but we still only grew from 7 to 18 million. Now, the flip side of that, though, is Prince George now has $400 million of ARR installed-- or excuse me, contracted were their words. So whether that might be installed, may not be. But that's still with-- they guided for $500 million by the end of the first quarter. So they have almost two months to install and contract an additional $100 million, so that appears to be on track. And just a few other things with my notes. Obviously, Oklahoma, 1.6 gigawatts of power that appears to be online in 2028. It's great that they've diversified from ERCOT and now have exposure in the Southwest power pool. Even though the states are side by side, it's still a form of diversification, which you like to see. And I think the best answer from the Q&A had to do, there were questions regarding Sweetwater's ability to get energized. And while there is this new batching process that Kent was speaking to, Dan seized the moment to simply say, Sweetwater one and two, are not only are they in the pool, but they're approved. Like they sign the letters. There's nothing to worry about with Sweetwater is the conclusion. And I thought Dan did a good job of addressing it and not leaving any room for doubt as to whether they could contract the site. Now, the energization, I would, unless they had updated us previously, I was under the impression that would be done By April, it appears it'll be more Q2, but even so, they can still contract it ahead of time, which leaves them, Childress and Sweetwater 1, primarily, to contract out. Other than that, this is kind of open mic. We'll see if Franz can join us or if anyone else wants to come up, has initial thoughts. I'm going to look over my notes and invite Tim up to start, and I'll add to it as we go. Might have lost Tim. Tim, good evening. Hey, is Mike Alfred tapping on by any chance, you know? I haven't, I saw him tweeting today, but unlikely for now. So... Okay, I was just going to wait till him and like Franz get on and stuff like that. So if you just want to keep me up here, I'll wait a sec. Sure.

Speaker 2: No.

Speaker 3: Was this a mean point?

₿itcoin ₿utcher: Can we? I can't pronounce this. Joyer. It ends in Joyer. What? You're up.

Speaker 3: What's this siren? What's this?

Speaker 4: A meme point room.

₿itcoin ₿utcher: I think you found the wrong room.

Speaker 3: No, this is the right room.

Speaker 5: Thank you.

Speaker 3: No, you're a *****.

₿itcoin ₿utcher: OK, Nick, why don't you fill us in?

Speaker 3: Hey, brother, how are you? Wow, what a day. I guess let me first start off by saying, like, this is probably one of the harder days that, you know, you guys will face as shareholders and investors. I mean, obviously, you know, around the tariffs was pretty bad. We nuked pretty hard. But I, you know, I was watching the price action on IREN after hours and immediately after announcement, it was up 5%. And then from there, we were down, I think at one point close to 23%, which is, It's pretty insane to see the whipsaw, which tells me that a lot of people are probably offsides on short-dated options, particularly the ones that are expiring tomorrow because everybody expected a hyperscaler announcement, and we didn't get one, which doesn't concern me. For the record, I was also in that trade and got nuked for a small amount of money. It's going to be a zero, but that's OK. Like, I underwrote that properly. But, you know, the fundamentals of the company and the earnings call, I was very satisfied with. Obviously, we knew something was coming in Oklahoma. The site was a little bit bigger than I initially anticipated, at least. Maybe Franz knew something that we didn't, but that was extremely positive catalyst. And, you know, like the deal's coming, like whether it's Google or whether it's another entity like it's coming. And it seems to, you know, all of these hypers or I'm sorry, all of these these HPC providers seem to follow a similar pattern that whenever these financing deals are announced, depending on what kind of structure they are, they're relatively complex. Now, the most recent here with Iran, not that complicated, but they all seem always seem to nuke the price action. I think that The common sentiment is that the company's incurring more debt and they don't realize that it's being used to expand the balance sheet, purchase assets, acquire new clients and fulfill the needs for existing clients. So overall, like the only thing that's really changed is the number on the screen. It sucks, guys. Like, you know, we're down sub 30. It's never fun, but. if you're not using leverage and you're not using options trying to time it, and if you're going to use margin, use it responsibly because these are they're high beta names, right? Like we can get 60% moves, 70% moves, whip sawing around, no problem. So, I mean, those are my thoughts overall. I thought the call was really good. And, you know, the question is like, when deal, right? I mean, it could be any day. I mean, the last With the last earnings, I think they announced the deal, what? It was like four days away from earnings, give or take. If I recall properly, I have to go back and check that. But these things seem to come in twos. So I mean, let's see.

₿itcoin ₿utcher: Yeah, the only thing I would push back on, Nick, is I couldn't tell if it was Dan trying to convey his confidence and not give up leverage. But I'm sure in the background, they're not stupid and they see the share price. And I know I said earlier, ignore the price on the screen. But at the same time, if they do sign someone, odds are they're going to be using convertible notes again down the road. So you can't just let the share price get nuked like this either, which I think personally That's why Oklahoma was released. From some inside sources we had, I don't think the intent was to initially announce Oklahoma. But given the market-- given kind of us leaking it, and on top of that, the past few days being pretty ****** I'm sure they felt the need to almost provide that carrot. And I'm speculating. I do think, though, Dan did give good color related to someone had brought up Coreweave and joint venture financing and being backed by Nvidia. And I thought he and Kent addressed it pretty well. First Kent saying you can have all this backing, but if you don't, I think it was kind of a shot at Coreweave, like, sure, they're backed by Nvidia, but they don't have power and they don't have data centers. And then on top of that, Dan doubled down and said, well, yes, Kent's right, but who's to say that we haven't talked with those parties and we just weren't happy with the terms. So that was another Q&A thing. Again, this was all kind of first read and sped through it from 8 o'clock to 8.45 in anticipation of this. So I'm sure I missed some stuff, but that's why I have everyone up here. I'm going to go to Jeff next for his opening thoughts, and I'll get to everyone else right after. Jeff, thanks for joining.

Jeff: Hey, guys. Not sure how long you guys have been going. I've been on a 90-minute phone conversation with a buddy, talking him off the ledge. He's down Let's just call it seven figures today. And he's he's definitely in a bad place at the moment. So I'm not sure what you guys have covered, what you guys have talked about, how long you guys have been going. I will preface that I've had several beers already. Been a rough day. Still thinking very clearly and have a lot of thoughts. One little funny point that I'll at least bring to the table to bring some humor to a day that's been quite dark is I was really glad to see that Dan has been taking some public speaking things and hasn't started every single one of his comments with, yeah. So that was fantastic. I love to see the professionalism. Not sure if anybody else noticed that, but definitely cleaned up that. On a more serious note, talking about Bitcoin, what you were just saying, there's definitely conversations going on the sidelines. You talked about different structures. To think that they're not being considered in the same breath as someone like Coreweave or somebody else would be absolutely ridiculous, right? I think they have plenty of... Optionality, I guess you could say I hate using that word right now. It puts a thorn in my side, but optionality in regards to getting backing in some sort of capacity, whether it be a stake, whether it be backing like core we've got. And frankly, Dan even said that it would be foolish for you to be or dangerous for you to be talking like they don't have those options or those conversations aren't happening. With that said, obviously I'm extremely disappointed, hurt by what's happened today. Am I worried? No. Am I sad? Absolutely. I hate watching money get thrown into an incinerator because that's essentially what happened today, right? But we announced a one point, I think it was 1.6 gigawatt site in Oklahoma. That's bigger than what we had anticipated. They alluded to other sites in Texas that could be considered for batch 0 for the ERCOT approvals, which I think is was kind of an afterthought in the conversations that were taking place. But I think it's something that is extremely noteworthy. If they're referring to things that are outside of Childress and outside of Sweetwater, that's extremely material and something that we need to be keeping an eye on. Right. We we've had the thought that Iran's pipeline was somewhere between three and six gigawatts. If Oklahoma represents 1.6 gigawatts, obviously there's more more to come. Right. At 4.6 gigawatts worth of power, you have enough power to support all of New York City and some as it is, and only 10% of that is contracted today. Currently, just their power agreements are worth more than their market cap. Add their their actual physical infrastructure, their land, their partnerships. The stock is extremely undervalued and that gives me a lot of hope. The fact that they were able to get less than 6% interest on their GPU financing is something that is frankly way above market rate. I would be I think you'd be hard pressed to find another company that could that could land financing at that rate or lower. I certainly Coreweave can't do it. I know Oracle couldn't do it. Nebius is going to have a hard time. Sorry, my thoughts are kind of all over the place, so I'm going to be a little bit of sporadic here. So just stick with me. Another interesting point that popped out to me, I think the fact that people were trying to crush them on the whole air con approval stuff, they confirmed that all 2000 megawatts for Sweetwater were 100% confirmed, it's nothing to worry about. But what stuck out to me is the fact that, uh, we are now going to be able to draw a line in the sand and find out who is for real. A lot of these megawatts that have been advertised, gigawatts that have been advertised, we are gonna find out really, really, really quickly whether those are for real or whether those are just a marketing ploy to pump up stock. Iron doesn't do that, right? Iron probably still has two, maybe three gigawatts, um, in their back pocket. They're not talking about where other companies are pumping that and using that to pump up their stock today, and they may not ever materialize. We're going to find out really quickly with this AIRCOT approval. I'm going to jump to the one thorn in my side. I'm sick of hearing about the optionality. I do think we need to be a little bit more decisive. If in fact, which they confirmed, Southwest is on track for energization in April, we need to find a tenant, right? Our boys at the helm need to make a decision and need to bring that to market and need to ink a deal, in my opinion. I think they've had plenty of time to do it. I think if ongoing conversations are happening at the rate that they are alluding to, and demand is as insatiable as they say. There's no reason why we shouldn't have a tenant, and I think we need to have one by the end of this month. That's my personal opinion. I'm not sure if it's going to be cloud or if it's going to be co-location. And frankly, at this point, I don't think it matters, but I think a tranche of Southwest one needs to have a tenant and needs to have one within the next 30 to 45 days for me personally to feel comfortable about it. I think Oklahoma was probably announced a little bit prematurely. I don't think they were planning on announcing that today. I think that was kind of a saving grace, which is fine and great. I don't think the price action today reflects how good the actual earning call was, and frankly, I was pleasantly surprised. I was anticipating kind of a down quarter, to be perfectly honest, but I'm not here for a single quarter's price action. I'm here for a long-term horizon. I see Iron as a big winner. in the long term, right? One quarter doesn't make it or break it for you. There was nothing that was said today that would change my investment thesis. Now, come April, May, if they didn't have someone for Southwest One, maybe I would be starting to reevaluate, but that's not the case at the moment. They have still, they still have time. I don't think anybody needs to be worried if you're sad, depressed, upset, about seeing your money evaporate, evaporate today. That's perfectly normal. I'm right there with you. It was a very, very difficult day, not just for iron, but for pretty much my entire growth portfolio. I watched. I'll be perfectly frank with you. My growth portfolio is down 56%, I think, in three days. That is infuriating, right? That's the reason why I've had four beers in the past two hours. So is it something that is going to get me out of the stock? No, I haven't sold a single share. I'll be frank. The $60 iron calls that I made for March have now been rolled out to May. Buying myself a little bit more time. I know it's coming. I just think it's not coming in March, unfortunately. Look, I didn't foresee a 30% drawdown today. I thought at worst, maybe, you know, 10, 15% based off of the prior day's price action. I didn't see us going to 29. It's encouraging to see us recovering a little bit. But I thought the team was extremely buttoned up. I thought the questions that they were asked for a change were actually pretty relevant. I think there were a few points that the analysts probably could have touched on that they didn't. But hearing that Sweetwater is 100% confirmed really put me a little bit more at ease. I think that I know I've said that and I know I'm going all over the place again. I I I popped on here and I just my mind's been kind of all over the place, so I'm just trying to touch on a little bit of everything that's been going through my mind. Look, I think iron is dirt cheap right now. I think the sky is the limit for them still. My investment thesis has not changed. I am, my biggest concern is that they keep talking about how they want to maintain optionality. And I think indecisiveness can sometimes kill you. And I think they do need to make a decision here relatively soon. And that's something that I personally would like to see. But yeah, those those are my initial thoughts. Another thing that did stick out to me was the software piece. So, Dan, one of the questions that came up was around software. I would love to get a little bit more color from management around, and I know they can't provide it at the moment, but apparently there's a multibillion dollar deal being negotiated where they're going to have to bring software to the table, right? That tells me that it's not a hyperscaler that they're in conversations with, right? And if they're talking to Microsoft or they're talking to Google, if they're talking to Amazon, do those companies don't want their software. So I'm curious as to who that potential partner may be. Honestly, I can't put my finger on it. I have no idea who it could be. The only thing that potentially kind of rings a bell for me is maybe it is a government deal and sovereign cloud where they may want them to bring the software, because I can assure you, Microsoft doesn't want their software, Google does not want their software, Amazon does not want their software, and neither does Meta. And that leaves me, if it's a multi-billion dollar deal, that maybe there is an AI sovereign cloud deal in the works that we're not hearing about for obvious reasons. So that's something that I would be keeping an eye on. I would have liked to hear them talk about expansion in Canada a little bit more, which they didn't get asked about. And obviously, they're not going to talk about. One other thing that I'll point out that was a minor concern. I haven't dug into the actual financials, but I need to see how employee compensation was divvied out in regards to shares. That was something that bothered me a little bit in the past that there were really no guidelines on how they were going to be divvying out. shares for performance. So that's something I need to look at more. I'm not going to talk about it because I don't know anything about it yet until I dive into it. But look, today was a for you gentlemen, grab your balls, bite your lip day for for you women, hold on to your **** and hold and hope for the best. Right. Look, I'm just as bullish as I was before. I'm hurt by today's price action. But this is part of the game, right? I still think Iron has a chance to perform, be one of the best performers in the entire stock market once these deals start coming through. I think we're just going to have to bide our time a little bit more. And I think something within the next 20 to 30 days is highly probable, or I'm sorry, a deal within the next 20 to 30 days is highly probable. And that's kind of where my thoughts are at. Again, thank you for sticking with me. I'm sorry. My thoughts have literally been all over the place. My ADHD is going crazy. It did not take my Adderall today. So I was just kind of speaking from the heart and whatever came to my mind is kind of what I what I spewed out. But I think I covered most of my bases and most of my thoughts for my call. So thanks for giving me the opportunity to speak Bitcoin.

₿itcoin ₿utcher: We appreciate you, Jeff. We're going to go to Javin, Tim, Zoe B., then Lil Mafia. Javin, welcome aboard.

Jeff: And one last thing before you say anything. Nick, if you're in my neck of the woods, hit me up. We'd love to grab some lunch with you. Um, I know you said you were going to be, I don't want to give away your location just for privacy purposes, but I'm sure people can probably figure it out if they go to my profile and see where, where, where I live. Uh, yeah, hit me up. Would love to grab lunch with you. I'd love to chat with you.

₿itcoin ₿utcher: Okay, Javin, I think we're ready now.

Jeff: Hey, um, I feel like I had a lot to say when I first joined, but Now, I'm not completely sure. It's all a mix.

Speaker 2: But yeah, I don't think anything would have constituted 30% drop from.

Jeff: The peaks of today's to the to into after hours. 30% obviously seems aggressive. And I feel like every day that we're in iron, we kind of test ourselves into saying what is really possible with the stock. You never would have thought that the stock would have dropped below the total Microsoft value contract. You never would have thought that the stock could have dropped below the pure asset values.

Speaker 2: Of, you know, the building, the metals, the power plants themselves, like the power lands themselves.

Jeff: And I think I do wonder, like, can iron price recover with a deal? I do question that, like, if a deal dropped tomorrow or next week.

Speaker 2: Where would we go with the price action?

Jeff: What kind of deal would need to drop for price action to maintain for us to gain a floor?

Speaker 2: I don't think it's safe to question that, you know, if we got a deal for Horizon 5 to 10, that we would stay at 40s.

₿itcoin ₿utcher: Hey, Javen, do you mind if I cut in for one second? Your skepticism or apprehension, however you want to coin it, I think it's normal, given the past few days. What I would say to you is, if you model out Horizon 5, and we're talking about 450 megawatts gross, and you're essentially doubling what you have right now. You have 300 in Horizon 1, and 160 in Canada. I know the rates are different and vary and all that, but just for simple math, if you doubled up and they just proved that they could finance 95% of the GPU cost via prepayment in GPU financing for below 6%, I think that was a big win today to find that 3.6 billion of financing. And I think they have a proven formula now. And I do think that Canada, while it only showed 18 million for the quarter, which is, it's not what we wanted by any stretch, but that sets a very low bar for if they are at a 400 ARR contracted right now. they probably have at least 300 of it installed, which if they get to the 500, there's a good chance they, at a minimum, 5 to 10x their cloud revenue for next quarter, which will look a lot better. And I would also say to you, like yesterday, there were 65 million shares traded. I think today, we crept up to 66 million. So in two days, you had 130 million shares traded, roughly. And out of that, yes, there's day trading and there's some duplicative nature to it. But there's a good chance that at least 10% of the shareholder base, if not 15 or maybe even 20% of the shareholder base switched hands in the 30s and 40s. And I would say to you that forms a pretty solid base going forward, given the CapEx spend we set of the hyperscalers. So I'm just trying to play back and forth with you. It is after today. I'm almost happy they didn't, even if they had an announcement today, it's probably smart if they withheld it because we would have got ****** anyways and not gotten credit for it. So the other way of looking at it is you do have those catalysts going forward, but I totally see where you're coming from.

Jeff: Yeah, no, I definitely see that. I think that's a good perspective, but also I think my current perspective is very much informed with you see all asset classes.

Speaker 2: Dropping pretty much at the same time.

Speaker 3: Gold, silver, Bitcoin.

Jeff: You see hyperscalers announcing over 500 billion in CapEx. And you would like to assume?

Speaker 4: That that announcement would obviously, you know, play into stocks and companies that are related to the AI trend.

Jeff: But I guess just there's a lot of things in the markets that right now that just don't really seem to make sense when you look at the math, I guess.

Speaker 2: And it's forcing us to do more math on things that we can't conceptualize.

Jeff: The other thing you gotta consider too, I mean, Amazon absolutely got crushed today. That's a big factor. Unemployment came in terribly today. There's just, I feel like we're getting killed. It's a case of a death by a thousand cuts. Right? Like there's just not one big thing. It's a death by a thousand cuts. And I think even the market might be pricing in a little bit, a potential strike in Iran and a longer stay there. Right? I wouldn't discount that either. It's not going to be as smooth as what happened in Venezuela. I just think there's, like I said, it's death by a thousand cuts today. You got Bitcoin dropping by 12%. You had Amazon miss that dropped by 14%. You had Microsoft get killed last week. Two of the three big hyperscalers like it just the market is still trying to figure out the new Fed share, right? I don't think the market was super happy with that. There's just a bunch of little things that are creating headwinds, and I don't think it's one big thing that you could put your finger on.

₿itcoin ₿utcher: Let's go. Or Tim, you were still waiting for, I think, Franz and Mike, correct me if I'm wrong. Yeah, and like Jason AI Williams or someone too. But yeah, if you want to keep me up, I'll just wait. No worries. Again, I was going to talk about some other stuff, but I mean, a lot of, like Buddy said earlier, it's, you guys covered a lot of it. So yeah, if you just want to keep me up and wait, if they do end up tapping in, that'd be wicked.

Speaker 4: Thanks, man.

₿itcoin ₿utcher: Yep. Zoe, you're up. Zoe B777 going once.

Jeff: I see them as a listener on my end, just throwing it out there. I don't know if they're available to speak.

₿itcoin ₿utcher: All right, let's go to Glasco. Glasco, you're up.

Speaker 4: Yeah, no, for sure.

Jeff: A bit like Tim just said, a lot of things said, but a big guy for beer in two.

Speaker 2: Hours cover a lot.

Speaker 4: So I guess we're good for now.

₿itcoin ₿utcher: OK, let me see if I can hit small cap up here. And he was going to join us while we're waiting on small cap to come up or someone else to come up. It's. I think the sovereign angle that Jeff brought up is very telling the software layer. You don't hear about it enough, but it's Dan was able to thread an interesting needle where not only did he compliment his own team on their ability to service the software contract, but he also was able to essentially indirectly tell Nevius that Their software remote doesn't mean **** because most of their business is bare metal anyways, as is Iron's. But the sovereign AI angle coming out of tonight, as well as the air cooled for the hypers and/or enterprise were two of the main new developments that they voiced for the first time. I'm inviting a few more people up here. Let's go to Joel.

Speaker 3: Hey, Butcher, thanks for having me. I don't have a long comment, but really appreciated the Q&A during today's call. When you look at a company maturing and the quality of the analysts that cover it, there's a big step up today. I mean, the detail and depth to the questions, a lot harder questions than I've seen in calls in the past. I really enjoyed listening to their answers. So it was good to see.

₿itcoin ₿utcher: Yeah, you're starting to see the shareholder base slowly turn and the sell side starting to reflect it. Obviously, having Goldman, if we could get Citi soon, but even the other guys stepped up their game today. I agree. I thought the quality of questions were, in the past, it's kind of been level one. These were level two and level three questions that gave us a little more insight. Sometimes we would have to wait for an interview with McNally Money and Anthony Power to get that kind of commentary. But Trying to see. KB24 was up, then small cap and marbles. KB24, how are you?

Speaker 3: Hey, Vic, butcher. Doing well, man. I hope everyone's holding it together on this bloodbath of a week. I just had a quick question. I don't know if you had caught some FUD after the earnings call by Dan. There was some mentioning about-- especially on X, people were mentioning that iron apparently is not having the ability to cool their GPUs besides just doing air cooling. From my understanding, I thought they were already talking about having the capacity to do liquid cooling for the GPUs at Childress and I think also in the site in Canada. I don't know if you or Jeff have any further insight regarding that to see if potentially, you know, if that is indeed true or do you think they're, because I think you'd mentioned something about a hyperscaler and mainly looking at air cooling the GPUs, just wanted to see if that's ideally true or not.

₿itcoin ₿utcher: Well, they coined it, the main constraint right now is time to data center. So if you're a hyperscaler in enterprise, you can use air-cooled data centers, assuming the workloads are primarily inference, you can still train in an air-cooled data center. But Kent did a nice job of saying that out of there, if you were taking a sales mix of what Iron Cloud was processing, over time, that's going to lean heavier to inference, was what Ken implied. So right now, the GB300s that have a rack density of 130 kilowatts, Those are being used for Microsoft and the Supercluster and Childress. Those are primarily used for training because they're the newest and the best models, and they have the most power associated with them. At the same time, in Canada, they have four different kinds of GPUs on hand, H100s, H200s, B200s. B300s. It's actually five. I think they bought 1,200 GB300s, which I didn't hear anything about liquid cooled in Canada on that call. But I think those 1,200 are designated for that. But that's immaterial to the 76,000 that will be installed at Childress. So to answer your question, I think that's just people-- You could feel free to send me something that is flood-related, and I'll openly embarrass that person for not understanding the nuance of what they're talking about. And it just feels like fear-mongering at first glimpse. But I think the real question is, if you're a hyperscaler, and you have a workload that you need done tomorrow, and you come to Iron, Iron's saying to you, Well, I can build you a liquid cooled data center in Texas, but that's going to take me some time. Or I can retrofit my McKenzie site or Canal Flats site for a lower cost, which means I can charge you a lower rental rate with my GPU and you can run inference on that. Is that something you'd be interested in? And odds are that's what the conversation is. I'd be willing to bet.

Jeff: Yeah, to piggyback off that, please send me that those FUD posts too. I'm known as the bear hunter. I'd love to take a stab at that and shoot some shots myself. But what I gathered from it was that the demand for air cooled was starting to ramp up. And so that's where that they were focusing. They also noted that they were on track for all of their Microsoft like checkpoints. So I don't think it's necessarily that they're having difficulty in that aspect. I just think they're following demand and running with it, right? With air cooled being quicker time to market, time to market is everything right now. And so I think there is just slightly more demand right now for the air cooled rather than the liquid cooled. If it was a problem, I think that there would be concern around them meeting milestones for Microsoft. So I wouldn't take that too much to heart.

Speaker 3: Got it. Appreciate it, guys. But Butcher, only one other thing I was going to say off topic, but the only thing that would make this week better if that news about Max Crosby coming to the Lions comes true.

₿itcoin ₿utcher: Yeah, we need edge help. Aiden can't do it by himself. I agree, buddy. The last thing I would add to the Eric Cool's conversation was if you look up the... cipher deal with Amazon for Black Pearl. That's actually split into air cool and liquid cool, which I believe the reason, if you were to ask Tyler, I know it's not iron related, but it gives you context on the space. They had built Black Pearl primarily for mining, which uses air cooled data centers because the ASICs require less kilowatt rack density than the GB300s. So I think it was the same conversation with Amazon, where if they had inference workloads that they could get online sooner at Black Pearl without tearing down the data center and rebuilding it, that made sense for them. But I'm speculating. So there is precedent, though, in the industry. I forgot if I said small cap or marbles first, and then S-curves following. We'll go with marbles first and small cap.

Speaker 2: Yeah, I think you said small cap first, but if you don't mind small cap, I'll just go real quick. I think a gentleman on the stage had said the analyst questions in the earnings call were pretty good. I have a difference in opinion. I actually think a lot of them were kind of silly. And I think it goes to show you that the ironing story is still somewhat misunderstood. And the reason why I thought they were silly, they asked a few questions. I think One of them was around Sweetwater 1 possibly losing the interconnection, which I thought was funny, because if you look at all the satellite images, the utility substation there is pretty much ready to go, and the bulk substation is also pretty much ready to go, minus the transformers, which have already been delivered. And the reason why that's significant is those are the longest lee items. So if you acquire them, it de-risks your entire operation. So for example, to build a bulk substation, that typically takes in conjunction with a utility that takes like 18 months. And if you don't have that for your site, then you can't have power for your data center. So I think that is something that's not emphasized well enough. And for example, this is why I think a lot of people invest in Nebius and not Iron are kind of missing the point. And I ranted about this before, but you know Nebius is starting at the same stage as meta like they're trying to acquire all this power from scratch. So if you're in the same stage as all these hyperscales, how are you How are you adding value to them if you can't give them better time to power? So I think they're just completely missed the point there. But it's probably not worth talking about anymore, but I think it's pretty obvious. And if you're bullish on NetBius infrastructure, then you might as well just sell NetBius to buy iron. If you're bullish on their software, maybe that's a different story. So I think that's the first point. I thought that was quite silly because you just have to look at the satellite images. Granted, we have asymmetric information there. So I think #2, there was a funny question about inquiring about the software stack for bare metal versus like having software, which I thought was another silly question because I felt like if you're an analyst, you should know that the total addressable market for bare metal was far, far bigger than software. And if you think about why, it's because a lot of the the compute demand is actually not only driven by inference, it's also driven by training, right? So if you're training all these models, generally you have your own software stack. For example, OpenAI, 50 plus percent of their compute goes to training and research. That's, and I suspect Anthropic's probably the same. I don't know about Google, but the two biggest pure AI labs spend most of their compute on on training, which is why they're so capacity constrained for inference. And I think again, if you're inevitable, you're missing the point there too, because like, for example, you could have software, but if you don't have the COMPI for what, you can't power any inference loads, you can't power any training loads. So I thought that was interesting because again, TAM, bare metal, way, way bigger, which means that in the short term, you can grow way faster if you have the power. And I think the third silly point that I thought they asked was, I think there was something about, I forgot, something about, it was, I forgot, but I think overall the demand environment still looks really good. And I think this is the part people don't really mention. People are so tunnel vision on iron in the stock price, which I totally understand, you know, particularly if you're in short term calls and you have margin and get liquidated, that sucks. But if you look at the environment, it's pretty insane, right? For example, we haven't had a new LLM that's been pre-trained by Blackwells yet, like the NBL72 Supercycle. People say it on Twitter all the time, but that's a huge deal. Because once you can get that clumpy online and finally train your models, likely your models will be substantial. They'll be not just incrementally, but substantially better than all these models. The reason why all these models are still getting better, I think it's because of more of the reinforcement learning feedback thingamajig. I'm not too further that is, but basically you don't. It doesn't require as much compute. It's like you have a base model and then you're just kind of like giving feedback and then you're saying, hey, no, this is the wrong answer. This is the right answer. And it's kind of like a brute force way of telling your model, training your model to minimize the loss. And for example, that's why you have these really good coding models by Anthropic. And if you just. Look at kind of the demand there. Every single time they release the model, it drives an insane amount of compute. For example, for Opus 4.5, which I use in my job and on Twitter, like I think when it was released recently, like it. I mean, Anthropic literally had to throttle that model because they had so much demand. So every single time you see these companies release these models, it drives more demand. And I think that's the point a lot of people miss. And a lot of people are freaking out like, oh my God, if Iron doesn't get a deal now, we're all ******. Because the assumption there is that manage is structurally static, right? And if demand is static at some point, supply will catch up. But that's not how it works every single time. I think the thing is demand is still increasing at a faster rate than supply can increase in the physical world. So I think this is a disconnect people still have. Like, demand is not structurally static. It's still increasing. So I just think it's really funny, and I think that when the stock price goes down, people find funny ways to rationalize why it's going down. Look, I'm not a macro expert, and I'll defer to a lot of people on the stage who know more about that than me, but I just still think it's early days. I still think the iron story is very misunderstood. I still think that a lot of the demand signals are looking great, so I bought a lot today. I think it's still time to be bullish.

₿itcoin ₿utcher: Marbles, do you mind if I ask you a follow-up question?

Speaker 2: Sure.

₿itcoin ₿utcher: What would you say to this-- I think the bear case or a skeptic's case for iron right now would be you do have-- you could look at it two ways. Like they framed it on the call as Hey, we got 460 megawatts that we're monetizing for cloud right now out of 4.5 gigawatts, and it's just over 10%. Wow, we have a lot of opportunity. Now, the flip side of that is that also means you have a lot to prove execution-wise, showing the ability to scale. Do you think that's a fair pushback? And I think personally, with respect to, yes, there was anticipation of the share price going up because of an anticipated deal, but also I think having Microsoft's a big seal of approval, but if you can get Anthropic and/or Google signed and you get two of those instead of one, you just doubled your credibility. How do you feel about that?

Speaker 2: No, I think that's a very good pushback. I think obviously a deal would, I think I think it would make all everybody, including us and a lot of institutional investors feel better if Iron were able to secure it. I still think they still have to prove themselves for sure. There is still it's not nonzero execution risk. There's still there's still execution risk. We can't see everything, but I I tend to be on the side of I trust management. So maybe, maybe it's just a personal thing. I tend to lean bullish and worry less. But overall, to your point, I do think that's a fair point. I think we'll just have to wait and see.

₿itcoin ₿utcher: Let's go to Smallcap.

Speaker 4: What's up, man? How are you guys doing? Obviously, not the results-- as far as price action goes, not the results we wanted to see. But I think that-- I think Marbles just made a great point. I completely agree with him as far as being in the early stages and just like being able to zoom out a little bit. So I think that-- I think that, again, look, people are just-- the people that want to start freaking out and kind of throwing in the red flag or white flag, whatever it is, and surrendering. It's like price action is not fundamentals, and they don't always reflect fundamentals. So just looking outside of Iron 2, just across tech, across the AI trade, software, or maybe not so much software, but just taking a look at the hyperscalers, just market in general, QQQ, XL, K, the tech ETFs, they're not crashing or dipping or correcting right now because demand has disappeared. They're just pulling back because the market might have gotten slightly ahead of itself to an extent. And I'll explain it again, right? The market is-- I responded to one of Mike's tweets earlier that the market is repricing time. not opportunity. So every single like every trade or just stock that was tied to AI or high performance computing, computing in general, computing infrastructure, power, data centers over the last year, year and a half got priced as if it was arriving yesterday. So we had multiples that really expanded pretty far and fast. And I think just expectations were way more compressed into the present. And that's where the capital flowed to, which works until it doesn't, right? So multiples are starting to be slightly compressed, but revenues and fundamentals aren't collapsing at all. Like if you look across the hyperscalers, like they have some of the best revenues that they've ever reported. I mean, AWS today, I think it had its highest growth rate in the last 13 quarters. Like Microsoft crushed revenues. Obviously, there was a little deceleration with Azure. But in an environment where rates are still like relatively restrictive and this whole AI trade is extremely capital intensive, whether and depending on how you're raising, whether it's debt, equity, JV, I think that just when the market senses a slight ounce of deceleration, it starts to de-risk pretty quickly, right? Or just start, maybe normalize a little bit. So momentum unwinds, and then these names that I said over the last year, year and a half that were tied to AI, data centers, power, computing, energy, whatever you want to call it, they start to like unwind as well and get corrected and hit at the same time. And I think that's kind of what we're seeing and it's really emotional, right? But it's also mechanical. So what we're like across the space in general, not just iron, like these stocks and you know, these companies are extremely capital intensive, right? Rates are sensitive and they're, what was the, I used a phrase on a different space today, like they're forward loaded. So higher for long rates increases the discount rate on future cash flows while we're basically living in the future. So none of it means that AI demand is slowing. In fact, the fundamentals are actually improving, and we've seen that over time. over the last few months. We've seen it over the last year. And even I think we got more validity and just more validity to that with these earnings prints from the hyperscalers. Like there we had there's more GPU demand, there's more way more power constraints, way more like there's a need for grid security capacity and there's going to be more long term contracts. But like the market is moving on positioning and timing. So I think that that's where we're getting like a slight shift because again, look at the hyperscalers like CapEx, every single one of them increased CapEx by a massive margin. Every single one of them had, except for Microsoft, I guess they had some decelerating growth, but like AWS, the Google Cloud, they all had like insane growth and projections for their cloud and for their AI build outs. It's just clear that now the market is not really looking at the forward, investors are starting to ask, institutions are starting to ask, okay, when are we going to see the return on investment? When are we going to see some like little ounces of free cash flow, which I think is normal, right? And so if you're watching price and panicking, it feels like the end. But if you're watching the fundamentals, right, the demand, power constraints, hyperscaler behavior, it just is like, it's not a peak, it's just a slight pause. And I think it's good for the market, man. Again, macro, not going into specifics, the last six years has been insane. NVIDIA during COVID was $100 billion company. They 45x. Same thing with, I mean, Google did 45x, but Google was like $80 a year ago. Maybe not a year ago, but 2022, they were like 80 bucks. During COVID, 40 bucks. They're, you know, you can't just have like euphoria 24/7. I think that this is a pretty healthy correction and a pretty healthy pullback. And it's kind of just like setting up for the next leg. And like Marble said, he said, like, if anything, he's bullish. You know, Iren, less than a year ago, like eight months ago, the stock, it was a billion dollar company, right? It's like 13, $14 billion today. We're trading at the exact same levels right now. Or maybe we're a little bit below, what are we at? Probably like 32, 33 or 30, trading at the same levels that we were at a month ago in December, month and a half ago in the middle of December. So again, fundamentally, like not much has changed. I'm not going to get into the specifics as far as like the earning call because I think that, you know, I joined a little bit late. I think you guys have talked about it. But if I were to just get into like the tape, The market is pricing in like near-term inflection. When macro tightens, the first thing that's going to get pushed back is like value is just going to get pushed back a little bit in time. And I think that's what we're seeing today. And it's also why, you know, Bitcoin matters, right? Like iron is at the intersection of Bitcoin mining and AI infrastructure. When Bitcoin pulls back, if it chops violently, the market's not going to reward optionality. It discounts it. So even though the long-term demand for computing, the long-term demand for power and GPUs, whatever, nothing has changed, the equity sort of trades a little bit like a levered proxy to this insane volatility in the short term. And institutions and larger investors, I don't think that they like that. I think Jeff was talking about the Fed chair. I won't get too much into it, but there's a lot of macro backdrop. So again, what is happening today? It's not a judgment on Iron's execution or assets. I don't think it is. I really don't think it's that much. I think it's just the market saying like, all right, this is a great story. Show me the cash flow. Show me the progression. Show me it's sooner. So that's why it feels frustrating, right? Demand hasn't gone away. Power constraints are real. Hyperscalers are spending, blah, blah, blah. We need more grid secured power. We need scalable computing. But market's not going to move on what's inevitable. It's going to move on timing and I guess you can say discount rates. So I think we're just like repricing and how long things are going to take to get to scale. There's no way it's repricing whether it's going to happen at all, right? Because scale is going to happen. So I don't know, Butcher. I think that every secular trend kind of looks like this during digestion. Like we're just in a digestion phase, right? You explode, you have an explosive move, expectations get pulled forward, and then eventually price has to come back and wait for fundamentals to catch up. So yeah, iron's down today, but it's, as Marbles was saying, it's 100% not the end of the trade. It's just, what some people might call an uncomfortable middle, but I don't even really think it's an uncomfortable middle.

Jeff: Small cap, with you being a big macroeconomics guy, I had mentioned that I think the market might be pricing in a potential strike in Iran, which might be a little bit more elongated than what we saw in Venezuela. I'm just curious, do you think that is playing a part right now at all?

Speaker 4: You know, I don't know. It's not that I, it's not whether I think it's, sure, I think it definitely could, you know, play a factor into it, right? I think that there's obviously like a geopolitical risk premium, if you want to call it, that's built up in markets. And it was obviously built up with just everything we've seen since 2022, right, with Russia, Ukraine, with Israel, Palestine, Venezuela, and now, Iran, but I don't really I don't think it has that much of a of a factor as we think, you know, I think that it's just geopolitics and macro combined, right? Like, I think the Fed share coming in kind of has something to do with it as well, right? Like, the nomination alone has injected a lot more uncertainty and policy into the markets, right? Like people are just thinking, you know, just because it It's a Trump Fed share, and Trump's going to basically, not control the Fed, but try to really influence it and get them to cut rates. We don't know that that's going to happen, right? Everyone is thinking differently. And I think traders are kind of unsure how the Fed is going to balance interest rates and just rate cuts with normalizing the balance sheet and just, again, uncertainty. pushes markets to repricing mode. So yeah, honestly, I do. I think that it has something to do with it. But I think this is more so just in general of like the market now focusing more on like less on the spend and the CapEx and, you know, what we're guiding moving forward as far as the spend and more so just on the return on investment. I think that when you see slight deceleration in the growth of what you're spending hundreds of billions of dollars on, that's when they start to get a little bit scared. And I think it was really Microsoft with what started the whole market going from, okay, great, like spend, spend, spend to now, not that it's not spend, spend spending, it's more so like when are we going to see a a return on investment. But again, as you said, Jeff, I think that you put the two forces together as far as like Iran, as far as the Fed. And what you get is just a market that's repricing time and not opportunity. Like up until recently, investors, and it's crazy how things shift. Like it's insane. It's just, it's a hell of an experience right now, like in the market, especially as a younger guy that hasn't been around, you know, too long, right, like five, six years. Investors, a lot of us believe that rates would come down pretty quickly, liquidity would stay loose, and the geopolitics would be somewhat contained, especially-- I thought this at the beginning of January. But now, markets are saying, all right, maybe they might stay higher for longer, and maybe geopolitics will escalate before coal. So I don't know. I think it's just, again, classic case of market discounting uncertainty rather than denying future fundamentals. So I think it's temporarily painful, and it hits earnings reactions, especially for growth stocks like iron, much harder. But it's a deep optionality play, if that makes sense. I'm kind of rambling, but I don't know. What do you think, Jeff? Do you think-- what do you think?

Jeff: Like, how much-- I think it's something that's underlying that's not getting enough attention, right? Like, I think we positioned ourselves for something like that, and I think people People who understand geopolitics and understand what's going on realize, I think we'll, I mean, let me backtrack for a second. I think a lot of people saw what happened in Venezuela and think that the same thing might play out in Iran. And I think they're failing to understand that it's going to be a much more arduous journey to go into Iran. It's not going to be a 12 hour thing. I'm not sure how much is impacting the market. So I was just kind of looking for your perspective to see if you think that might be something that's underlying, that's not really being talked about. It's kind of getting, it was getting a lot of attention, but now it's kind of getting swept under the rug. And I wasn't sure if you think that's generating more, a broader market weakness because of that?

Speaker 4: Yeah, it could be. And I, and I wish I, you know, was keeping up with it. I think there's just so much **** going on in the world and the market that it's hard to keep an eye on everything. If ******* Bitcoin dropped, what, 30% in the last week, I've had my eyes on that nonstop. And then obviously when Iron is kind of like a levered proxy to it, it's going to get hit as well. Yeah, no worries.

Jeff: I mean, I didn't want to put you on the spot. I was just.

Speaker 4: No, you didn't put me on the spot at all. No, yeah, you didn't put me on the spot at all. Like it's a fair question. But as far as just like the tech, yeah, Jeff, I don't know, man. I'm a little confused as far as, as far as like geopolitics, there's just so much going on. And again, like what's silver is silver's down like what, 50% in the last week? It's just an insane market that we have right now. And yeah, I think it's definitely worth keeping an eye on geopolitics and seeing how that's going to drive the market, because it's not over yet. There's a lot of instability and destabilization that's happened across the world, especially out east. So I guess we'll just have to wait and see.

Jeff: I hear you. And Bitcoin, I had another question. I don't want to jump the line. I know you have another couple of people on. I saw Franz came up. I'd be interested in like yours, Franz, and Marble's take on this. I'm willing to wait, though, because it's a little off topic and I don't want to jump the line. I'm happy to share my question with you right now, but I want to be respectful of the other people who are willing or waiting to talk as well.

₿itcoin ₿utcher: Jeff, if you don't mind, I want to go to Ask Kurv and Nick and Franz and we'll circle back to you.

Jeff: Yeah, no problem.

₿itcoin ₿utcher: Ask Kurv, how are you this evening? Doing good, doing good.

Speaker 3: It's been a little while. How are you doing?

₿itcoin ₿utcher: I mean-- Been better? Loaded question, buddy. No, I purposely wanted to go work out and then listen to the call and not pay attention to what my trading app was saying, and I came away. I think your most bearish analyst was Reggie and the gentleman from Goldman at 39. And the business improved from that rating for them between the financing risk being addressed and the new pipeline. So I think in the next few days, you're going to see the desks settle here. People will digest this call and you'll see some upgrades and we're probably going to bottom out if today wasn't it. I personally think there's going to be-- you're already seeing we hit 29, which is kind of fake price action in my opinion, but that's back up to 35. And I saw that Max Payne was 50 tomorrow. So it feels like they cleared out a lot of the option exposure for tomorrow that they had, that being the market makers. And I just think with the volume the past few days, and I know some very prominent iron shareholders, I don't want to name anyone out of respect for their privacy, but I know that there were people that were in the low single digits that sold today in the 40s. So I think you're going to see, kind of like Bitcoin, it runs parallel. If you were looking at the average shareholder costs, I think it rose up today. And some of the old money, the retail just didn't want to-- they wanted to get off the ride. And I don't want to call it capitulation. I'm not judging, but I just think the last two days, we're going to look back and you're going to see the other piece of it being with Bitcoin getting nuked, the ETFs were unloading shares. So that gave, if there were institutions standing by, ample opportunity to scoop up shares in the 30s and 40s, which is probably their target range. So I think between new institutional buyers-- and again, I'm speculating-- institutional buyers that we're waiting along with if you see a rebound and a bottoming of Bitcoin, those ETFs will-- if they can unload them that quickly, they can buy them back. I think in the next week or two, we're going to start to climb back up. But I'm more interested in what you have to say, because I respect your opinion. And I haven't heard from you in a while. So what do you got for us?

Speaker 3: Yeah, I've been pretty quiet. I've kind of kept my head down lately. But I think there's a few things. I think the price action, I think, what is it, small cap sniper, I think as he alluded to, I mean, some really solid points. It's not all an iron story. A lot of it is broader market too. I don't know, maybe it could be the Iran strike, I think. A lot of what's going on, I think the new Feds here kind of spooked some people. I think there's also an unemployment story. When you've got unemployment, it's been gradually ticking higher. It's sitting in the mid fours. And typically, an acceleration in unemployment is going to precede most major recessions. And then I think as well, you just have some seasonal selling. So if you think back to the tariff tantrum last year, in February, I think it's really when the decline started. And so where are we at right now? We're in February. People made a lot of money last year. I know I've got a nice little tax bill I've got to take care of at some point here by April.

Speaker 5: And so I think.

Speaker 3: You've just got a combination of things that are completely agnostic to what's going on with Iron. Now, I think I actually expected Iron to sell off following earnings because I think expectations going into earnings were so lofty. And anytime there's a disconnect, it's the difference or the disconnect between expectations and reality. I think it's always a long shot. I think every time they don't announce a deal, we always expect that the next earnings call, and the next earnings call, and the next earnings call. And so I, not to get sand, but I just try to be like water.

Speaker 5: And when it comes, it comes.

Speaker 3: And I take a step back and I just try to focus on the big picture. And I'm not saying this is right or wrong, but Everything I'm looking at, so small cap spoke to this. If you look at hyperscaler cloud revenue growth, it was about 20% year over year. If you look last year, this year, it's actually accelerating. It's growing 25% year over year. So clearly, there's demand. That's accelerating. Time to power isn't getting any faster.

Speaker 5: It's still.

Speaker 3: Three years to get a grid connection near Dallas, like what I'm seeing, seven Atlanta, Chicago, higher in North Virginia, way higher APAC and in Europe, so the international markets. And then I just look at adoption. And this part, I would be curious to hear anybody in here who has a W-2 job and just anything around white collar, kind of your take?

₿itcoin ₿utcher: But what I'm seeing is.

Speaker 3: In the corps that I work with, in 2025, people were really skeptical about AI. And I would say the error rate and the hallucination rates were high enough that it would be really difficult to kind of integrate into critical processes. I think around what I think there was a really big shift And maybe it was the new model releases or maybe it was just better agents, but like third quarter or fourth quarter of last year, I really started to see error rates and hallucination rates getting down below 1% or getting to about 99% accuracy. And in 2026, I've got all sorts of anecdotes of the end customer, right? Corporate AI adoption really ramping up in a big way and people starting to kind of think about what's possible and starting to actually integrate these things into critical processes. So I'm actually expecting 2026 to be a huge year for AI adoption. And then if you think into all the things I just said, I think hopefully that translates into a big year for Iron as well. But I would be curious, anybody that's got a W2, or even if you don't, if you have any anecdotes or any stories, not to take over the space butcher, but if you're okay with it, if anybody, I don't know if I'm taking crazy pills or if I'm on an island here.

₿itcoin ₿utcher: Marbles is probably the most qualified up here to speak to it unless someone else wants to invite themselves up.

Speaker 2: Yeah, I can briefly speak to it. I work a W2 job. I do some coding. And I can tell you from a coding standpoint, the models are pretty insane. There's not a lot of code. If you're trying to do Greenfield development, if you're using something like Opus 4.5 or even Cloud Sonnet 4.5 or any of the GP2 5.2 Codex models, they're incredible. I really just have to be very, I think if you're, Did I cut off? We can hear you. Okay, cool. Yeah, sorry, my Wi-Fi is pretty spotty sometimes. But yeah, but I think if you're using those models, you're doing it for green for development, they're incredible, right? As long as you can specify what you want, and you write essays of, you know, declarative language, essentially, those models can do incredible things. But even if it's in a code base, those models are pretty amazing. They can fix code, edit it for you, and you really just have to edit it. So it's, It's insane, right? And I think my, the place I work for, it's funny, I spoke to one of the higher ups this week and I was asking about the AI initiative just because I wanted to know like what his own thoughts were. And it would give you kind of like a sense of the industry in general if they were trying to pursue more AI initiatives, which would lead to more compute, which would hopefully trickle down iron. So that's why I was curious. I asked him, hey, look, it seems like you guys are having all these AI initiatives. And he's like, yeah, of course, we're trying to do all these things. And I asked him, well, how do you know it's adding value? Like, how do you know? And he said he didn't. And I think a lot of the perspective right now is you can't afford to say no to AI, right? Maybe if you're like insurance and you work really slow pace, but a lot of these tech companies, if you say no to AI, you just look stupid. You can't afford to say no. So a lot of these companies are, I don't know if they have demonstrative value generation from AI, I suspect they do, but they don't know how to quantify, they're having all these AI initiatives before they even know what value it's adding. So I just think that for sure we're gonna see, I tend to agree with S-Curve this year. I think we're gonna see an insane amount of token consumption, just because, not only because of what the hyperscalers have said, but also anecdotally from what I've seen with the models from people I follow on Twitter, it's not just for coding, right? I think there's a lot of the market that doesn't fully embrace AI either, especially, for example, in law, you only have certain companies using AI. But GPT-5.2 is really good with that, apparently. And I think a huge swath of the insurance market doesn't use AI. A huge swath of the financial market doesn't really use AI. They just use Copilot to summarize stuff. But a lot of these people I know, they're not using LLM notebooks or Excel. They're just doing Excel by hand, right? So I just feel like A, they're incredible. A lot of people still don't know about them. And B, I tend to agree with S-Curve Capital. I think there's going to be more adoption that's going to lead to more demand for compute.

₿itcoin ₿utcher: Thanks, Marbles. Let's go to Nick before Franz. I'm sure a lot of people want to hear from you. Nick, how are you?

Speaker 3: Hey, how are you? I'll be brief because I want to hear Franz. So first thing I have to say is I think there was a bullish call. I love the fact that they're negotiating A multi-billion contract. This settles forever that we have a deal coming pretty soon, right? My intuition is that this is going to be probably Sweetwater. And I am thinking like this deal would consider a big chunk of it, but this is only an intuition. So it's speculation. My second comment is in regards to the price action. I think that it's, at least today, it was mostly driven by, typical market maker, volatility type of place. They want, to sell All the options super expensive, so they like the volatility, and I, think they're just, when everybody, I think there's a lot of puts at certain levels, and then they're just selling and selling and selling, because... they are on the other side of the trade, so they have to sell. And I think most of the puts of the open interest is around 30, and that's why the price, the fall down stopped there. It barely got to 28, I think, but it pretty quickly went back to 30. I don't know what's going to happen tomorrow, but I think most of it is just like a game that they're playing. to their advantage. So I wouldn't, you know, be super focused on the price action these days. And that's it. The other thing I like very much about the call is that they seem to me like very patient, you know, they are, and I think this is big for them or for us. I think they are very patient and they're procuring the proper financing, which is very important. I don't think people understand that when you grow, you cannot grow like crazy. Like you have to go step by step because if you go like crazy, then you can almost kill yourself because you don't have the financing and then it's like a snowball that just goes on top of you and kills you. So I think they're doing precisely the right thing. They're moving step by step, growing slowly but surely. And this gives me a lot of confidence that they're doing the right thing. Also, I think that this patient is gonna pay off big with the new contracts or the new leases. We have been seeing how Google, Amazon, and Microsoft have been terribly punished, you know, because of their increasing CapEx. And I think this is very bullish for IRANG because these guys, can easily convert a CapEx to an OpEx. And this is just by picking up the phone and talking to Irene and say, Hey, I need to lower my CapEx. I know you're renting, bare metal and I'm interested.

Speaker 4: You just give me your price, right?

Speaker 3: The more they wait, The more Iran is patient, the more this argument is going to pay. And if they see that every time they increase their CapEx, they lose billions in market cap, I think this is going to be an argument, at least in the future. And that is all I had to say. I'm looking forward to hearing from France, and thanks, Butcher, for having me.

₿itcoin ₿utcher: Thanks for joining, Nick. Franz, why don't you just start off with your initial thoughts, and if anyone has questions for Franz, feel free to come up or DM me, and then I'll have a few follow-up questions for you, if you don't mind.

Speaker 5: Hey guys, yeah, it's difficult to give a, you know, a first reaction. The price action's just been overwhelming, and I clearly didn't see that coming. So I'm going to try to ignore that part and focus on what Irene actually said and reported. I was wrong with my expectation of them not announcing Oklahoma. I did tell my subscribers that I thought it was confirmed that they have the power and we basically got the evidence of that earlier this week. Since we know where the site is and we know in which county they are operating, the 1.6 gigawatts is actually divided into two parts. Ireland didn't tell that to the market, but it's first 600 megawatts is coming in 28 and the subsequent 1 gigawatt is scheduled for 2031. So there's, I mean, it's both signed with the utility, but it is a phased delivery. But that sounds possibly not as bullish as 1.6 GW by 2028, but I would just like to stress that it doesn't really matter compared to, if you compare it to Sweetwater, what was said on the earnings call is they can't draw 1.4 gigawatt by April anyway. You know, they can't draw more power than they have data centers. So I think the same thing applies for for Oklahoma as it does for basically every site that Iron has. But there there could be a possible more bullish swing to this Oklahoma side is that we've heard from talks with the county that there are actually mini phases within the first phase. That means there are 300 megawatt phases in the 600 megawatt and 75 megawatt phases within those 300 megawatt phases. So I am sort of optimistic that they could deliver 75 to 150 megawatt of data centers, possibly very early 28 or very late 27. So that could mean, a little bit earlier than what they projected. So all in all, I think this site is a very great addition to their portfolio. I think the market's not reacting to it at all, just for the fact that, you know, like Nick just said, There was a massive amount of boot spot for the 20 and 30 handle. There's just, if market makers want it to go down, it will go down regardless of what is being reported. There is no entity in the market that can beat market makers when they want to stock the tank. So that was just what happened. And I don't know if this is already discussed, but I think we're having a big drag on those levers ETFs as well. as the WGMI. I think Iron needs to get out of that, but okay, I wasn't going to talk about stock and you see, I'm still doing it. So yeah, I think it was great they announced that. I am very satisfied with the GPU financing. I've mentioned numerous times to my subscribers, I was expecting 4 to 4.5 billion dollars. They got 3.6, which is still $1.1 billion more than they guided for. And I think the sub six interest rate is beating my own internal guidance of sub 7%. But there's a little, I don't know if this was already mentioned because I joined a bit late, but Dan mentioned on the call that it was a blended 3% interest rate, but to get to 3%, you need a not a sub 6% but you need a sub 5% interest rate so I'm uh I'm kind of lost how how he got to 3% maybe it uh it really means that below 6% is really a lot better than 6% but yeah I mean I mean I have no idea but um uh yeah so what else I'm just trying to quickly go over the uh presentation that I finally managed to download after the site was offline. I'm sure this was already mentioned, but this is absolutely pathetic, amateuristic that they can't handle their own website as a cloud provider. The traffic is just too much for them, I guess. Yeah, the ARR in British Columbia was a big positive thing for me. They guided for half a billion by the end of March and they secured 0.4 billion by the 5th of February, which is, it's ahead of schedule. People were a bit bearish when the 250 or 225 $1,000,000 wasn't reported by the end of December last year, but beating it now in this fashion, I think it's satisfactory, satisfactory enough for me, at least. And I think the market should be, you know, rewarding that in to a certain degree. I think, honestly, they mentioned, they are on schedule to be to the five, the $0.5 billion by the end of March by mentioning it as more than but I think that could easily be to towards 0.6 billion. The thing is, we just don't know how many GPUs are actually operational. They said that there are still GPUs coming in the coming weeks. So based on that, you know, it could be anywhere above half a billion dollars of ARR. So that's positive. I just wish they would, you know, elaborate a bit more on who are their enterprise clients. And, you know, I've been pounding the table on that. I think they should do like fireside chats with their fireworks AI and with Together AI. 'Cause, you know, these enterprise and these platform providers, they're shopping for compute at different cloud providers. So for example, together AI also works with the hyper tech and fireworks has other data centers providing computer them. It just strikes me as odd that Iran doesn't like do these kind of talks with their customers to, you know, give a bit of air time to to to their own capabilities of infrastructure, supply, and at the same time bringing commerce or customers or any kind of focus to their customers. It's just a win-win thing, I think. But well, there are a lot of people that have been complaining or mentioning that they were too quiet for the last three months. I kind of agree with that. I do believe that they are trying to get better at this, but with a company like Iron, I think it just takes a long time for changes to happen. And they always keep focusing on execution first, construction first, and the optics later, so to say. So What else can I say? I wrote a couple of comments today. Oh yeah, there was that shot from the presentation where they said 650 megawatt at Childers. I talked to IR already posted the earnings call and they said that there's no less power draw at Childers. They just don't have a data center that draws that specific 100 megawatt right now, so they didn't mention it. I just think it looked a little bit weird because The other 3.6 gigawatt of secured grid connected power also doesn't have a data center. Why didn't they just add the 100 megawatts to that pile? But okay, it's still there. Obviously, it's going to be needed for Horizon 1 to 4. So that was just optics. Other than that, yeah, I think they had a good call. It was a little bit short, but you know, it is what it is. The questions were really good. I think most of the analyst questions were really a lot better than we've seen in the past. And yeah, I'm looking forward to the inevitable inflection point in AI revenue in the coming quarters. I personally expected it to happen in this current quarter that we're in. Sorry, no, in the next quarter, so in the calendar year Q2, but it's probably going to be in the second-half of 2026. The Microsoft revenue recognition was stated to be in Q2, so that should be no later than June 2026. I am concerned that this will trip over to the next fiscal year. So I'm not 100% sure that they are going to deliver a significant amount of Microsoft revenue in this fiscal year. I think that is based on my due diligence in the construction and the operational side of Childress. It doesn't mean that there's going to be a delay towards Microsoft, in my opinion, but I think they have a a lot of work to do in Childress to, meet the guidance for the end of the year. So I hope they're going to be transparent about that, because someone mentioned that we missed on a lot of things, missed on EPS, on revenue. There is a case to make that Iron should talk to the analysts better. they should inform the sell side that, look, we are having our GPUs come in a week later. Maybe you should revise your estimates. I don't know how these relationships work with the sell side, but obviously they were all off. So I hope they can do that. They can improve on that for the next earnings. And I think I'll pause there because I've talked for too much. And if anyone has something specific to hear me on, I'll gladly answer.

Jeff: So Bitcoin, if you don't mind me asking, Franz, I got a question for you specifically because we've kind of already covered it. Something that stood out to me was about the software piece. Looking at the people that they're negotiating with, right? They're limited players. where Iron's software piece would be relevant. The thing that jumps out to me would be a sovereign cloud deal. What are your thoughts on that?

Speaker 5: Yeah, so I know what you're talking about. Dan said something along the lines of we're in a multi-billion dollar negotiation where Iron has to bring or provide the software. But, that could mean a lot of things. I am, if I'm looking at the report presentation, it says on the capacity page, it says technology stack, internal technology and operations team. I don't know if this is software or if it's purely related to optimization of their infrastructure, but could it not just be as simple as orchestration? Like maybe they have figured out the very basic level of software and their bare metal, or maybe it's like a bare metal plus kind of deal that they're negotiating, which just means that Iron's providing compute plus a little bit of orchestration, or maybe they're bringing Weka or Wika or whatever, you know, I don't know.

Jeff: Agreed with you on that. But the question for you on that, right? I mean, Microsoft isn't going to want that. Meta's not going to want that. Google's not going to want that. Amazon's not going to want that. So if we're talking about a multi-billion dollar deal, bringing software to that table, right? Who else could it potentially be? Let's let's even throw out Sovereign Cloud, right? Do you have any speculation on who that customer could be that they're negotiating a multi-billion dollar deal with? I do have a follow up question for the for the rest of the team too after this.

Speaker 5: Well, I just I think it's very difficult to estimate what Dan really meant with software. So based on that, I would say it could just mean like a little bit of little bit on top of bare metal, which would be something that maybe a Fortune 100 client could be requiring. I don't know. I didn't think about a sovereign AI at all, but now you're now you're mentioning it. I mean, it would make a lot of sense if like Iron would broker a deal with the Canadian government where Microsoft is endorsing them or something. But I also get a feeling that if you read the earnings presentation, it basically says something along the lines of that they're next, that they're, okay, let me just look at the slide about their customers. Yeah, demand is not a constraint, focused on building the right partnerships, that it's based on delivering. So, okay, I can't find it right now, but I got the, my read was that if they deliver on the Microsoft contract, it's going to open up, you know, signing a new deal. So, Let's just speculate that it could be a sovereign AI. Maybe it could mean that they are, in the run for a deal with the government. For example, in Canada, that could make a lot of sense. Maybe the software would be some kind of, security or compliance kind of software. I have really no idea. I'm not I'm not educated in software for AI, but.

Jeff: I would say if you're looking for that transcript, I actually have it right up for you. And I just, I'm sorry, I'm not trying to interrupt you. I, because I do want to get your thoughts, but if you read Dan's thing right, there's only so many players that could orchestrate a multi-billion dollar deal where Iron would be required to bring the software. And Dan's quote was, Maybe just to give you some additional comfort around the way the world might go here, Paul, is we do have an internal software capability. I think we probably downplay it a bit, partly in response to the market seeming to overplay it. But we've got the capability. To give you additional comfort, one of the contracts we are negotiating at the moment is a multi-billion dollar contract where we need to bring the software solution. So it is not holding us back. It would not, so it is not holding us back. It would not hold us back. The reality is exactly what Ken said. We are dealing with a large, and then he goes on to saying like the majority of the contracts that they're negotiating wouldn't require it. To me, the only thing that speaks to that would be sovereign cloud. And I'm not asking you to agree. I'm just wondering, you have a big brain. Is there anything else that comes to mind where we would need to bring that software stack for that big of a contract?

Speaker 5: I can't think of anything right now from the top of my head, especially since the wording is software solution. I mean, it sounds like for a solution you need to have a problem. And I don't know, maybe that's more something that governments have. They have problems. Companies just... I mean, that's basically the only thing I can think of. I can't think of a name for you right now from the top of my head, so maybe Marbles has something useful to say.

Jeff: Yeah, gotcha. I just wanted to make sure that I wasn't like going way off track here, but that was the first thing that jumped out to me. Marbles, yeah, I'd love to hear your thoughts, but I do have a follow-up question after this again.

Speaker 2: Yeah, it could be Anthropic. I'm not 100% sure. I think Anthropic had to deal with HUD, and I think FluidSec was the middleman. And I know FluidSec knows how to do orchestration with Slurm and Kubernetes. So, you know, I suspect they could do some orchestration workloads for Anthropic, and I think that is one possible candidate.

Jeff: Perfect. That makes sense. Yeah, I mean, I was just trying to wrap my brain around, right? I mean, most of the stuff that we hear about are conversations with hyperscalers. Hyperscalers have zero interest in Iron software. So first thing that came to mind was Sovereign. That makes sense too with Anthropic. So I was just trying to kind of gather everybody's thoughts. There's a lot of big brains in the room, so I figured I would ask. So I appreciate that perspective as well. I do have a follow up question for Franz, Bitcoin, anybody else that wants to take this. There were a lot of questions about co-location versus CSP. Did you hear anything from the Iron team that would make you think that they are now giving more consideration to a co-location deal? Did you catch any nuggets? To me, it still sounded like they were very much on the CSP side, maybe 80% CSP, maybe 20% considering co-location. I just want to get your perspective based off of the comments today, whether you think co-location is now more being more considered than it maybe it was. last quarter when they were pretty adamant on going up the food chain and doing CSP.

Speaker 5: Maybe it's a maybe it's a negotiating tactic to increase the colocation offers they have. I don't know. But specifically in terms of nuggets, I will go back to the Anthropic topic. I've heard through my channel checks that Anthropic has been mentioned as someone they have talked to or are talking to. So that is a first thing. And second thing is I can confidently say that Iron is able to run TPUs. So if the situation comes to play, they will be able to do colocation with or for Google or a hybrid where there is like Nvidia GPUs, Tana's infrastructure as a service and TPUs under a colocation agreement. I mean, this could be a whole new a whole new thing that doesn't exist yet because I don't think Google has outright done something like that before. But Iron is at least on a technical and operational level able to do this. But I haven't heard anything about considerations. I would say that it could also be like part of negotiation tactics. So I can't give you like a percentage, like 80-20 or something.

Jeff: Yeah, I don't know, totally. It just feels like they may be, they're considering. co-location more, or at least it sounded like they were, more so than they were on the last call. And that's kind of why I wanted to get your perspective. Bitcoin, I saw you put your thumbs down. Did you have any thoughts on that?

₿itcoin ₿utcher: I was on mute. Echoing Franz's thoughts, I mean, because then Dan spoke to, I think the number was, he said you got 200. megawatts, I'm assuming critical IT is saying you're generating 300 million versus a few billion in cash, which kind of echoes this past sentiment. Could be a negotiating tactic, but I tend to think after they just pulled off that financing round on the GPUs that they appear committed to sticking with bare metal infrastructure as a service. But at the same time, if you have the opportunity to team up with Google and Google just says it's colo or no deal, I do think Google is the one company you would make an exception for. possibly Amazon for the same reason, but I would lean more towards Google, just given the TPU starting to take some market share, it appears, and if they're able to create a little more pressure on, excuse me, Nvidia's moat with CUDA, that gives you a little more diverse clientele, which I would argue de-risks the business. And with the size of the portfolio, like if you don't see a rebound in the share price, you could argue they, I think that was one of my main critiques today, is yes, you address the GPUs, But you got $3 billion in cash. Anthony, how do you plan on using the $3 billion? And I just still think maybe it's for sake of the negotiation. They don't want to give it away right now and they have the plan. But I personally think institutions need to be spoon-fed the story. And right now, we're kind of in the same spot in a lot of ways. And if anything, adding an extra 1.6 gigawatts kind of amplifies the questions on how are you going to fund this. So I think that's kind of my point with this is like we're familiar with alternative options behind the meter that are coming online. And I think 2026 and 2027 is kind of their opportunity to put their business into motion and start scaling and build up a lead. I know it's a bad example today with how ****** Bitcoin's doing, but if I was a Bitcoin treasury company, the way Saylor did it, now he's got 600,000 Bitcoin, even though who wants to own that right now? my name notwithstanding, but he had such a head start on his competition where no one can catch him, where I think Iron might not get the best deal tomorrow, but if they can build their pipeline sooner and scale it up and create this cash flowing machine, and if the whole point of these deals anyways is to pay for the infrastructure, and the infrastructure is the asset in five years, I sometimes ask myself out loud, while I'm happy that they're patient and waiting for the right deal, would there be an incentive for them to close something sooner? But if they don't have a construction capacity as is, then maybe I answered my own question. But yeah, we would like to see deals just so that they can prove their concept so that more than, I think Franz made the point earlier, and it's fair that out of their energized portfolio, what have they used versus non-energized, but kind of still feel that way. Franz, I did have a question regarding They, I think I, maybe I heard it incorrectly. I was under the impression that Sweetwater was supposed to be energized by April, but now they were saying Q2. Does that, did that constitute a delay to you or did I misunderstand that? Do you understand?

Jeff: You misunderstood it. They said April, they confirmed April.

Speaker 5: I think it was typical Dan Roberts sandbagging, because a little bit later Kent Draper said, but we don't have 1.4 gigawatt of data centers by April, so we can't draw 1.4 gigawatt anyway, something like that. So I think Kent is more the commercial guy who is saying it as it is, so I believe it's still April. And if we go by what we see happening at the site, it looks like it's ready to flow. But there's this one thing that I would say is a bit of a question mark was that the ERCOD file said the bull substation connection would be in May of 26, but you know, I guess at the end of the day, it is between iron and utility. and not between Iron and Aircot. So if Iron has a deal with the, because it's a tier 4 thing, it's not an Aircot high priority emergency or urgency thing. So I guess if Kent says April and the company guides for April. It's going to be April. But at the end of the day, it doesn't really matter if Iron doesn't have any data center design or data center. They said they are procuring data center material, I guess. So I guess it just depends how quick they can actually build data centers. And if the energization is a few weeks later or earlier, I don't think that matters.

₿itcoin ₿utcher: Franz, I think I know the answer, but one other question before we go to Marbles. When you heard the reference to air cooled for enterprise or hyperscalers, I've read into that as potentially Mackenzie. Is there any way that could be the existing mining data centers in Texas, those are air-cooled. Is there any way you could have an enterprise or hyperscaler down there without demolishing them? Or is it just solely Canada? How did you interpret that comment?

Speaker 5: Yeah, that was slightly confusing to me as well. I don't know what to make of that for now. I think that what they said mostly means that there is hyperscale interest in Canada. I don't think it means something with regards to Texas. I think Iron is trying to design a new type of shelf for Sweetwater. I think that because we know from the Oklahoma county meetings that Iron is going to deploy the Sweetwater design at Oklahoma and not the Childress design. So this makes me kind of confident that Iron is going to deploy some kind of modular data center at Sweetwater. I can't rule out that there will be air cooling involved. And to add to that, actually, I was informed that there are filter bags spotted on site. And that is a really weird kind of thing because those are only used in mining buildings, in air-cooled data center shells that Iron builds. So I'm not saying it's going to happen. I can't confirm nor deny because I just simply don't know. But I think the specific notion of customers are now interested in both air-cooled and liquid-cooled data centers. I just think that means, hey guys, we have hyperscale interest in Canada. I think that is basically what it means. And that also aligns with what I heard in Sydney when I was there that, you know, a site like Kennel Flats is being looked at as a single 30 megawatt cluster. for a potential hyperscale tenant. So that's also why I was anticipating something with Microsoft in Canada. But at the same time, this also means that maybe we will see a sovereign AI cloud in Kennel Flats or McKenzie. I mean, you know, Iron speaks in sort of a very safe way that they say, yeah, we're going to go to 140K GPUs by the end of 2026, but they include Microsoft deal, but they also include their own Iron cloud. So all we know is there is a certain quantity coming to British Columbia, but we don't know if it's going to be for Iron Cloud or if it's going to be for a hyperscale deal or a sovereign AI deal because they just don't specify that. But so, I don't, I'm personally not convinced that Texas will see air-cooled AI. That's, I don't see it happening. Maybe a hybrid model with some kind of like a rear door heat exchanger that you get some kind of low CapEx version of an AI liquid plus air cooled data center. I mean, I don't know if it's feasible at that kind of size and scale, but who knows? For now, I just think that they were talking about Canada.

₿itcoin ₿utcher: Before I go to Marbles, my only thought related to that was as a cipher shareholder as well, they at Black Pearl, that's dual purpose where I believe the mining hall that they created initially, there was going to be both air cool and liquid cool at Black Pearl for Amazon, which made me wonder out loud, is it possible that we're talking to Amazon for horizon, but I tend to agree with you that it's more likely related to Canada. But Marbles, you had your hand up.

Speaker 2: Yeah, regarding Canada, I think they're hiring a few DevOps engineers there, which I thought was interesting, because the job requirements say they need to know Kubernetes, which is generally something you need to know for orchestration. So I thought it's a little interesting that I think it seems like Iron is trying to move up the stack here. So I was wondering if, Browns, you had any thoughts about that or Butcher?

₿itcoin ₿utcher: Hey, Marbles, do you mind, since we have a lot of listeners with a non-software background, can you remind us, orchestration? There was one other term earlier, actually, unrelated, that S-Curve was talking about hallucination rates for AI, and that was one that I wanted to chime in that I didn't, hallucination rate being the model comes up with an answer that it thinks it's right, but actually spits out an incorrect answer. And since those are decreasing, those are becoming, that means the models are becoming more reliable for work functions. But do you mind defining that before we answer marbles?

Speaker 2: Yeah, orchestration. Yeah, so orchestration is basically like, I think when you're trying to spin a GPU up, spin a GPU down, you're trying to monitor the overall GPU health, or you're trying, I think when you like, You have to also shard models across many GPUs because they can't fit on one GPU. So I think orchestration just has to do with kind of allocating the correct resources, the correct queries to the right GPU based on the workload the GPU currently has and based on the overall health of the GPU and toggling that and adjusting that over time. I think on a high level, that's kind of my understanding of orchestration. And I think to your point about hallucination rates, I think you That was a great definition. I think the reason why that's really important is that with things hallucinating less, they tend to become more reliable. And when models are more reliable, they lead to significantly more token consumption, which leads to significantly more compute over time, right? When people can trust these models, they're going to run these LLMs as well, agent-powered LLMs, or LLMs empowering agents. They can run them for much longer time horizons, which will consume a lot more power, and that's bullish for us as infrastructure investors. So I think that's why the hallucination rate point is actually quite important, and that's an important nuance that I think some people miss. But yeah, I wanted to inquire a little bit about that and maybe ask Franz, get his thoughts, because I know historically everyone has been ******** on Iron for not having a software stack. It does seem like they're trying to move up here a little bit. So I'm wondering if they're trying to expand Iron Cloud in Canada, if that's a focus for them?

Speaker 5: Yeah, I mean, I can't answer that because I just don't know. But I mean, it's obvious, right? If you look at it from multiple angles, the one angle is Dan Roberts saying they are going to deliver a software solution. And the other angle is the hires. And we know that they've been hiring people from DigitalOcean like last year as well. I think one of those guys, what's his name again? Scott Newman, he was some kind of the software engineer at DigitalOcean on a senior level, I believe. So I think or at least at a certain high level, I guess that that's what they're going to do over time. But I think I'm not saying I don't think it's a like a priority to become a nebius or something. I think they're just going to add as they as they go to their stack, So I guess that translates to customer demand as well, because I think that everything they do is within a risk adjusted framework, both for capital as well as a GPU purchases, as well as the counterparty that they are working with. So, I mean, it would be amazing if it would be a sovereign cloud contracts where they provide software. I mean, I don't think you'll see a lot of nebius FUD going forward if that would be the case. So I'm all here for it.

Jeff: One thing I do want to just point out, and this is just a little bit, little side note. So Digital Ocean actually used to be a customer of mine. I sold to them very, very, very familiarized with their business. And one thing that does stand out to me about DigitalOcean is that I think they would be an ideal candidate for a potential acquisition. Now, this is just my brain rattling, but DigitalOcean doesn't really specialize in going after sovereign cloud or large enterprise customers. Their sweet spot is more SMB customers. They're looking to land the next Google, grow them. and then have the next Google within their stack. They're really, really good at provisioning hardware in a really, really short amount of time and for very, very cheap prices. They have exceptional software. Again, this is just a pipe dream, but I could tell you that if Iron is looking to ramp up that software side of the business, DigitalOcean might be a a very, very attractive acquisition candidate.

Speaker 5: Yeah, I don't know much about Digital Ocean. I did buy some stock when I found out that Iron has poached on people from them. I don't know if that really happened. Maybe Iron just had better prospects for stock-based compensation. But I already sold out of Digital Ocean. But They do Twitter spaces sometimes where they do like presentations and they get like 5 years. It's kind of sad. But anyway, I'm wondering, did you guys already talk about the, because in one of our Iron group chats, there was a discussion going on about optionality. I'm just wondering if you guys already spoke to this topic where there is one camp that is bullish and saying, okay, it's good that Iron's waiting to sign customers even though energization is near. And there's the other camp that says they are overplaying their hand and the hyperscalers have all the leverage because they have all the money. Did you guys already talk to this topic?

₿itcoin ₿utcher: I think earlier I kind of touched on my position. I've leaned towards the hyperscaler. Yes, we have 3 billion in cash on our balance sheet. Yes, we finance the GPUs, but I still think we have reputational risk in the marketplace in that we've only signed Microsoft. We've yet to hand it over yet. So I think there's, the hyperscalers by the same token, we can wait them out because we have the power, but they can wait us out. And if we're not perceived to be delivering data centers to energize infrastructure, then our share price gets hit and that makes it more expensive to use equity to fund. And by the same token, people that are lending with the tanking share price would be less confident and our cost of capital for debt might go up. So given the size of the pipeline and what they have available, they've said themselves that they're going to chunk out Sweetwater. So if they can even parse out 200 megawatts of it to start, I see an advantage to that to show execution. And all these deals are structuring ideally for five years anyways, where yes, you might not get the most, the best rate of return in that five years, but if the point was optionality long term, then you started the lease earlier. and you have access to the option to do whatever you want with the data center five years from the time that you execute. So I kind of. I'd like to see a little more progress and some more signings, not because I'm impatient, just I think there's a pragmatism to it where if you're going to tell everyone that you can be this. multi-billion dollar hyperscaler, then we probably have to see more than 18 million in cloud revenue for a quarter. So that was my thought on that.

Jeff: I had similar thoughts as well. I think with a lot of these companies that are pre-negotiating deals for 2028, I can't help but be a little bit skeptical. as to why we don't have a deal for Sweetwater, given the size of the site, given its uniqueness, given the demand. If it is indecisiveness on Iron's part, that is a bit concerning for me. I think they need to just kind of grab those nuts and decide what to do and make a deal, right? Even if it's just for a portion of Sweetwater, the longer it goes, the more alarm bells kind of go off for me a little bit. I think that if a deal isn't signed by the end of this month, it would be a bit concerning for me.

₿itcoin ₿utcher: Franz, I think everyone wants to hear how you feel about it.

Speaker 5: Yeah, so I think to say it typical Iron style, it's very binary. And we are, you know, I think this all comes down to trusting the management or not. I think most of the arguments I've seen from the negative camp is that they don't trust the management or not anymore. And overplaying their hand is all kind of front running the the situation where they are not going to sign a deal. But the truth is that, you know, it's not it's not April yet, and we are not energizing Sweetwater yet, and we are still mining Bitcoin in Childress. I've seen the wallets and it's back up, so it's not like they've actually been taking off hash in in in Childress. Maybe they did in in Prince George, obviously, but I think they're mining as long as they can. And basically that's also what they said in the in the SEC filing, by the way, for this earnings report. They specifically stated that they are going to mine as long as they can until they really have to take offline hash. And I think that means that You know, I won't say it's like a very great BATNA or anything, but they currently don't have anything outside of 100 megawatt in Childers that is operational and flowing that is not monetized. So you can either be bearish on their prospects of signing a deal. At the same time, There are a lot of reasons to be bullish. I know that they are talking to significant names, including hyperscalers, including Google. So we know these companies have all reported that they're going to increase their CapEx. You know, I am not in a camp of believing that hyperscalers are in secret rooms negotiating the max of GPU hour prices that they are willing to pay. I'm sure that there are some-- that they are looking at each other a little bit, but I find it hard to believe that they are establishing a cartel on GPU hour rates for GB300s and Ferro Rubens. I think that's a bit out there. I think the hyperscalers are competing with each other. And at some point, this is going to drive up the price that they're willing to pay for compute. And we are not present at these conversations. We can only judge Dan Roberts and Ken Draper on an earnings call. And other than that, the post that was just made by Dan's account is obviously drawn up by IR. I mean, I'm pretty sure that he's even not replying when we're commenting. I think that's not Dan Roberts himself. But so what I'm saying here is we are not part of these negotiations. And I think it's very premature to consider they're overplaying their hand if to date they haven't signed a bad deal and they haven't gotten a lot of unmonetized megawatts that are actually flowing. So I guess it just comes down to believing in the general, in the broader AI market. If they are saying the demand is there and their demand has not been stronger, I mean, what was the literal way that they described it this time? It was the strongest Strongest customer demand to date with multiple advanced negotiations as execution continues and financing progresses. So I guess that kind of implies that if they deliver on, for example, the first horizon, like a Horizon One or maybe the first shell of Horizon One, they will be able to sign. So, you know, we are months away from revenue coming in from Microsoft. maybe that will be the sweet spot, the moment where they will be able to advance their next deal, you know. So I just, I don't think that the team has done something that would make me believe that they are unable to sign deals just because they only signed Microsoft so far. I think our expectations gone up because of things we heard through our channel checks also because, you know, the energization is so close and our peers are all signing deals years in advance. But at the same time, we have to understand all our peers are signing co-location deals. And I don't think Nibius has been signing like years in advance for their GPU as a service deals. I think Vineland was basically on par with Horizon 1 to 4 in terms of time to data center. So just to summarize it, I am on the bullish side. I think Iron's going to sign a massive deal for Sweetwater and I think they're going to sign Entropic. I think they're going to sign more with Microsoft, possibly Sovereign AI somewhere. I'm not sure. I mean, it would be like the solution for Canada if Iron would just, you know, just make friends with the government because I think that they haven't been friends with them for a long time. I think it's time to change that. So yes, I am bullish on this side. I think. All the negativity is coming out now. It's showing in the share price. I think Irons has reported a pretty bad quarter, so to say, with all the converts that they've been rolling and the, you know, they're kind of like having a kitchen sink quarter, so to say. And I think that if they sign a deal in the next, in the coming three months, you know, you're going to have so much better earnings with all the AI revenue coming in from Canada. They're going to report the first Microsoft revenue coming in. They're going to show that everything is up to schedule. Sweetwater won, energized, and then you get a deal on top of that, you know, you're off to the races. So, I mean, yeah, you can be bearish at this point, but it's not me.

₿itcoin ₿utcher: What would, just to kind of, what would change your tune on that, Franz? Like what's a reasonable line in the sand? Like Jeff had, 'cause people are trying to come up with, even though it's subjective in that you're stating your opinion and there's really no right answer, but I do think people look to you as the leader in the, community, but I think if we're judging management and trying to be objective about their performance, what would cause you to not necessarily lose trust, but what would surprise you at that point? If, for instance, let me ask you this, if by May 1st, you know, a few weeks prior to the next quarter's earnings, is it fair to say we, as shareholders, it wouldn't be unreasonable to expect at least something signed at Sweetwater? And then my other question would be, with Horizon, even if you're still using the mining while you're constructing Horizon 1 through 4, Are you implying or are they implying? I'm just trying to understand and I'm not putting words in anyone's mouth. I'm just trying to understand are the is it mutually exclusive to run mining yet have a signed client? Like I I feel like you could negotiate something with the client where it's. I can't build this till X and in the interim I'm gonna use my mining halls to generate cash. Just your thoughts on those two questions, I would appreciate it.

Speaker 5: Yeah. So I don't have a date in time that I would say this is where they need to have a deal. Otherwise I will reconsider my investments. My investment thesis is basically, let me just say it like this. If they **** ** the Microsoft deal, then I'm out. So they got to deliver. This is essential for the existence of the company. So, you know, the Childress is a very growing really fast. It's a very busy site with a lot of people over there. I've voiced some concerns in a post where I showed the parking lot that's oversubscribed, so to say. I just want them to to keep everything in check there and deliver on time. If they do this, they're going to de-risk everything, including future deals with different hyperscalers. So I won't chase them for a new deal. I will absolutely burn them if they will not deliver the Microsoft deal. That is the only thing that can break my investment thesis in iron. Because that's what they are building the company on, right? It's going to be infrastructure as a service. They want hyperscaler deals and they want to build fast. Right, now you have your financing in order. done. Now get your operations in order and show us construction updates because I'm doing it myself with all my subscribers and we are seeing a lot of things. But we just want to hear from the company on a regular basis that they are delivering, that they're handing the operations over to Microsoft, that the chips are coming in. You know, just keep us informed. And based on that, I think It doesn't really matter for me if they are going to sign a deal in April, May, or June, because it's inevitable that it's going to happen. If they can land Microsoft and deliver Microsoft, then, you know, Google is not going to be concerned. So I think that's what it's mostly tied to for me. So can you remind me your second question?

₿itcoin ₿utcher: The way the, it almost feels like we're framing it as Horizon 5 cannot be signed without unplugging the miners. And I'm asking you, is it your understanding that the moment they commit the site that they would have to unplug and demolish immediately? Because I would push back on if that's your position or their position, what I would say to you is, if we're able to sign Anthropic or Amazon or Google, and that creates an increase in shareholder value via the share price and the equity, right now with Bitcoin at 60,000, even if it was 70,000 and you were generating 30,000 of Bitcoin, and for 40x of hash, let's say you're producing 500 a month, we're saying $15 million in cash flow, and we're sitting on 3 billion in cash. I personally think for the direction of the company, You acknowledged earlier that it's not the BATNA that we thought it was, and it just feels like a lame excuse to carry on a legacy business that I just don't see in the next three or four months Bitcoin going over 100K. let alone 200 or 300K, which would be the break even for CSP. Whereas if you can lock in the right client and create the right incentives to solicit new institutions, because now I can, as an investor, Really, if I'm Mike Power and I can say, yeah, Microsoft's into us, we're signed with them for 1.9 billion a year. And by the way, I just got Amazon and that's an additional 3 billion of annual recurring revenue that's fully funded. Like that is a better story than. Hey, we have these miners that we paid for. It's a sunk cost and I can generate 15 million in cash for less than like 180 million a year run rate. That just doesn't move the needle for me. So that was my only, I had voiced that the other day in a post and that would be my pushback. So the question though, after that mini rant was, are you saying that if they were to sell the rights to Horizon 5 through 10, the leasing rights, and sign a lease that they would immediately have to unplug the miners and tear down the mining halls? Or is there a way they could negotiate potentially, Hey, we're completing Horizon 1 through 4, but you guys are next and we will have this built by X date, but we'd like to release your commitment to the market just to show that the space is sold out? That was kind of a question.

Speaker 5: Yeah, I mean, I don't know. I was, I heard some sounds that the block four and five were planned, you know, scheduled to be decommissioned, but that was later withdrawn and revised to not all the buildings will go. And then now I'm not really sure anymore after seeing the earnings presentation where they are saying, we won't, we won't take down hash until Horizon 5 is happening. So I guess, I guess it depends. I think it's the same answer as I gave to the other question, honestly. I think if they deliver Horizon 1 or the first shell of Horizon 1, and it's all working accordingly. I think it's going to open doors for subsequent deals with maybe more flexibility towards energization. So I kind of get that from that headline in the presentation. Strongest customer demand today with multiple advanced negotiation. as execution continues and financing progresses. So I'm not sure if it's the right interpretation, but I kind of get the notion that this is all contingent on completing Horizon 1 or a part of Horizon 1 for Microsoft. So I... I think Iron will be mining in Childress with 40 exahash or at least 35 exahash until the end of this year. That's personally my belief. I don't think they're going to start a new contract in Childress with the current facilities maxed out. I mean, they're building a new command center, like a sort of office, which is a lot bigger than the one they have now. They're expanding with like one parking lot per week and it's still too many cars. the people are having a hard time parking and, Children's is in the middle of nowhere. It's not easy to live around there. The restaurants, the hotels, it's all fully booked, you know, people are reporting that hotels are only charging day rates. They don't allow weekly rates anymore or monthly rates. So it's all costing the, you know, the people working on the site more money to be able to get there. And then at the same time, you're seeing that Lancium is setting up shop in Childress. They are buying up all the land. They are trying to recruit people that work for Iron. It's kind of like a head scratcher to me how they would ever be able to operate another construction team in parallel to Horizon 1 to 4. So I don't see it happening. I think it's all eyes on Sweetwater. I think we're going to see a massive Sweetwater deal that will be with a single client for 200 megawatt of IT load and then with options or, a customer that can scale on the side. Looking at the satellite imagery, you can already see where they're going to be building these 200 megawatt units. They are, you know, The early earthworks are very good visible on satellite imagery. You can always see where they're going to go next, where they're going to build the next primary substation. It always goes in a similar fashion. Like you see like first these lines in the sand and then you see parking lots and then you see like a designated area, this rectangle that's always in a basically same size as horizon one to four. It means that's a 200 megawatt IT load area. So I think it's going to be Sweetwater where we will see the next deal. That is my personal belief. So I think whatever they're doing in Childress with Bitcoin mining, I don't think it's going to be, you know, a very significant factor in anything. I think it's just going to keep going. I hope they will just choose it as long as they can. while delivering on the Microsoft deal. I wouldn't want to jeopardize the Microsoft deal for another deal in Childress right now. I would just finish that thing first and just go all in on Sweetwater and, you know, just keep mining with the mining buildings in Childress. Keep everyone safe. You know, no construction accidents, no dissatisfied staff. I mean, people is the most important thing right now, especially after the capital is secured. You have to take care of your people, And since the founders are not in the US, I believe that they need to take this part very seriously and they need some very C-suite oversight at Childress. So I think that the command center that's being built is going to facilitate for that. And I really hope they're going to do that. And I just want to stress one more time that delivering Microsoft to you is absolutely essential for the existence of this company, in my opinion.

₿itcoin ₿utcher: Franz, before I go to two more people on stage, and then I wanted to start wrapping this up because we're approaching midnight on the East Coast here. What's your expectation for handoff of Horizon One to Microsoft timing-wise? Do you have an estimate on that?

Speaker 5: I think it's going to be the end of Q2. So I think it's going to be like a delivery starting April, May, and then June for Horizon One. I don't think it's going to be earlier. I think that's because, you know, you have to look at the first shell of Horizon One. Basically, you have to compare that to the first mining building they ever built in Childress. It was a very lone building for a long time because they had to figure out all the first things, the pipe fitting needs to be moved a little bit like this. And it's all these optimizations. And then as soon as they figure it out, it's a hockey sticks up. So I think we should not focus too much on the specific month. I think if Aaron says, they are on schedule with the Microsoft deal according to the contract terms with Microsoft for delivery. That's all you need to know. So nobody, including the people that are actually building those buildings, knows anything more than that. Because if Iron says they're on schedule, they're on schedule. So we have to just believe that's happening. So I just... I don't think the revenue is the most important thing here. I think it's just the delivering on the deal to Microsoft is the most important.

₿itcoin ₿utcher: Okay, let's go to Morgan and then AFF. Morgan, what do you got?

Speaker 3: Hey, thank you.

₿itcoin ₿utcher: So actually was originally going to make a comment about the timing of their deal negotiations, but I actually wanted to ask a quick follow-up about Franz's comment. So you're actually not expecting another Childress deal in 2026? Is that what you're saying?

Speaker 5: Well, I can't say they won't sign a deal. I just really hope that they're going to focus their construction team in Childress on the horizon. they're going to focus the rest of all their operations and construction teams and subcontractors and whatever on Sweetwater.

₿itcoin ₿utcher: OK, got it. Thank you. So I wanted to just to comment about like the timing of the deals because like I agree with what Jeff was saying that like if you look at Wolf, Cipher, Hut, it looks like, you know, why hasn't Iron signed another deal? But Like Iron has a pattern of being like a more aggressive negotiator than these other guys. And so if you think about like, like from their perspective, the price probably keeps going up a little bit as they talk to the hyperscalers. So they're just like a more aggressive negotiator and then the price probably keeps going up a little bit. So like, you know, they're basically getting paid for waiting a little bit. So if you think about the combination of the price going up and their more aggressive negotiating stance that might sort of make sense.

Speaker 5: Was there a question in there or did I miss it?

Speaker 2: Oh, no, that wasn't really a question.

₿itcoin ₿utcher: That was just well, I mean, I'm just curious what you think about that. That would be my theory. But I don't know. I mostly just wanted to make a comment, I guess, but also very curious if you.

Speaker 2: Have any thoughts on that as well?

Speaker 5: Well, The only thought I have is something that I heard through a sort of confidential talk. So I won't mention the name and I won't mention anything else than I know Iron is currently in negotiations for acquiring GPUs that are not coming from Dell. And the conclusion I can draw on knowing the counterparty is that I believe Iron is getting a maybe a bargain or maybe a very fast delivery on those things because they could potentially be inventory GPUs. And based on the earnings call where air cooling was mentioned, it could might as well be air cooled GPUs. So Yeah, I think, I don't know if this is directly related to what you said in terms of deals, but at the same time, on the cost side of things, if Iron is able to get like below market or previous market rates for new GPU purchases, then maybe waiting a little bit with signing a large software and AI or a 30 megawatt single cluster in Kennel Flats kind of deal would benefit them as the market rates are going up for these GPU hours under the high bandwidth memory shortage and stuff like that. So yeah, I mean, I think there is something to say about waiting, but I don't think they're like only actively waiting. I think Iron just really likes to build these data centers and retrofit them first before they are signing deals. And we also know that customers prefer GPUs to be on site before they sign deals. So outside of like the Microsoft kind of deals, I think for Iron Cloud or for Canada in general, I think it's not a bad thing to wait a little bit. Yeah, so I don't know what else to say. I mean, I think the complexity of like a Sweetwater deal on itself is so incredible. I mean, we're talking about thousands of pages in these kind of contracts, so I can totally sympathize with taking a long time. I know that, for example, the Microsoft deal, Iron had to actively you know, lobby to get through to people at the C-suite of Microsoft. And once you get there, things start to get a lot easier. So I guess this is something they might have to do with some of the other hyperscalers as well, you know, so to get through to Elon Musk or or, you know, I guess it just takes time to to get to those levels. But I don't think it's a makes their position any weaker. We'll figure it. We'll see how it goes.

Speaker 2: Hey guys, I hope everyone's having a good night. I just had a couple of questions.

Speaker 4: Overall execution, what are your general opinions on it? seems like the, obviously, you know, from its lows, it's 5X, but from recent... months, we've seen a massive drawback.

Speaker 2: And do you expect this drawback to persist and continue?

Speaker 4: And if so, what is your estimations of seeing a bottom in some type of recovery?

₿itcoin ₿utcher: I personally think a bottom is within a few trading days, given the volume. especially after hours, that felt like capitulation if I ever saw it. We reached on December 15th, this is just, this isn't hopium, this is just actual data. December 15th, we hit $33 a share at the end of the year, post-earnings, debt equity, offering, all that ********. We go down to 33. And then last week, we ended at $63 a share on either Tuesday or Wednesday. And that was just over a month, like 5 weeks. So this thing can turn very quickly. And I said earlier, the two most bearish price targets for iron right now are Goldman and Chase with $39 price targets. And that doesn't include a new site that they added in Oklahoma because they wouldn't commit to a pipeline number. So now they actually have new electrons that they can sell in the future, a grid capacity. And it also includes a lot more assurance that they can execute, which I think takes I would have to look at their actual valuation model, but a lot of times they will handicap a valuation or sensitize it for execution or financing risk. And now all those GPUs are financed and I got to believe they didn't have their GPU debt expense at 6% or whatever. It comes out to be more likely if they were being conservative, it was probably 8 to 9% like their former financing deals. So I think all of those are bullish catalysts. And anything can happen. This could go lower. But I'm willing to bet that a month from now, we're going to be higher than we are today. And that's just my piece on that. I don't know if you had anything to add, Franz.

Speaker 5: No, I've talked enough.

₿itcoin ₿utcher: Okay, let's go to AFF before we go to stock meetups. AFF, thanks for waiting. All right, stock meetups, you're up.

Speaker 3: Yeah, now, overall, the market is a little in a panicky stage because of the combination of crypto and like whatever Michael Barry is saying about AI, HPC, whatever, right? But when you look at the actual reality, If you look at these four companies, Amazon, Meta, Google and Microsoft, they made the net profits of 372 billion in 2025.

₿itcoin ₿utcher: So.

Speaker 3: Amazon was around 70 billion, Meta was 60, Microsoft was 100 billion and Google had 130 billion of net profit. So they are saying, okay, they are going to invest 500 plus billion, you know, combined. I don't know why market is so much panicking, et cetera, because of all negative news is getting spread. But if I look at it, they are spending, they're going to spend in 2026, just 1.5x of their net profits.

Speaker 2: That's it in all this, right?

Speaker 3: I think there's a lot of FUD which is getting spread. But if you look at in the broader scheme of things, I think all these companies should be very comfortable in spending the 1.5x of one year of profit. Not a big deal if you look at, on the broad scheme of things. And they know the demand, they will not be fools in doing projections and not thinking about the demand they're going to get. I just want to say that because there's a lot of negative energy here on.

₿itcoin ₿utcher: Yeah, thanks for the contribution. If I've repeated myself, it's 'cause we've been going three hours or two hours and 46 minutes, but who's counting? But I refuse to believe that at the risk of my own financial peril, I just don't see how this doesn't turn around relatively quickly after people wake up and realize that Amazon's spending 200 billion and Google's spending $180 billion, and Cypher's getting attractive financing. There's so many market data points in the last two or three days while all this shit's been going down that suggests that we're living in two different worlds, and I would rather live in the marketplace of how debt's trading than how the equities traded the past few days. Let's add a few more people, and I'll go for another 10, 15 minutes here, and then I'll wrap this up, guys. Jeff, you're up. Hey, guys.

Jeff: So I joined this conversation a little bit late, so I apologize if something I'm asking has been stated already, but I have a couple of questions. Obviously, I know today a lot of us are seeing probably a considerable amount of money down. So it's good cope to start trying to figure out narratives. And I don't know if that's particularly helpful at this point. You know, the market's down for whatever reason, all kinds of manipulation, fear, cycling. It is what it is. I don't think we saw too many fundamental issues out of the tech industry over the last week. that would suggest there's a valuable reason for why it's down. So I'm less concerned about broad market de-risking. But two questions I have are, one, for anyone who paid attention to the earnings today, was there anything in there that if we're being objective about it was concerning? Besides the fact that there was no deal announced, were there any indications from what was shown or stated That seems concerning. If we sort of take our blinders off, realize we're all deeply invested. So that's one. And two, you know, I understand that there's some energization coming on in Q2. They've got quite a bit of power ready to sell. Obviously, it wasn't announced today. But is it concerning or odd that they'd be this close to being ready and not yet have a deal in place? And is there any indication of when something like that might actually get announced?

₿itcoin ₿utcher: My personal disappointment was I was anticipating a higher cloud revenue number. It was 18 for the quarter versus seven for the prior quarter. So again, how they calculate their, they had a target annual recurring revenue rate of 220, or excuse me, 200 to 250 million. So 225 is the midpoint. Now, they could have technically met what they disclosed by having those all installed on the last day of the year. But for all intents and purposes, I think it's fair to say that they missed on their guidance. So I was disappointed in that. But at the same time, they addressed that by saying that they had 400 million of ARR already contracted and they have two months. So they have to contract the additional 100 million and all those have to be installed by the last day of the quarter. So I think they're on track, but I'm surprised none of the analysts pushed and asked about how their installs were going and delivery. That would be one thing I would be looking at, which maybe Fran's commentary in the prior comment on seeking a vendor outside of Dell that may have risen from the need to just get more access to GPUs quicker, but I'm speculating. And then as far as the deal goes, if you just logged on earlier, I kind of asked the same question out loud. Horizon itself is kind of a *********** right now 'cause they're trying to finish one through four, which is for the Microsoft deal. So it might be difficult to, you could in theory get it signed, but you're really not going to construct Horizon 5 anytime soon, given the site constraints it appears. But to your point, I was happy Dan addressed that there are no problems with Sweetwater with any of the two gigawatts. And Franz said earlier, or you can say it if I'm saying it incorrectly, but we're both of the position that they're on track given what we've seen through satellite imagery. It suggests that the infrastructure is ready to be energized probably by April, and we'd be surprised if we didn't see a deal by next earnings, which would be approximately three months for now. So we'll just say may Cinco de Mayo. I think that would be a reasonable expectation. And if not, I'm more expecting it by that earnings personally, whereas Franz was giving a little more leeway and was more concerned with delivering Microsoft in a timely manner. But Jeff or Franz, if you had anything to add to Jeff's question. Looks like they both are away right now, Jeff, but was there anything else we can address before we go to Basketweaver?

Jeff: Yeah, I think that was really helpful. Thank you for the insight. I guess one final thought. If revenue was down, I'm assuming-- I think I had kind of moved from height into iron originally because I was trying to de-risk a little bit by rotating out of Bitcoin-adjacent miners. I think iron is still pretty heavily tied to BTC. So would that fall that we've seen over the last three months not have been a heavy contributor to those declining revenues?

₿itcoin ₿utcher: Yeah, I mean, we said for the quarter, I don't have the-- I could pull the number up in front of me, but I think it was 235 the prior quarter, and it dropped to-- 180, but 18 of it was cloud. So 90% of it was Bitcoin mining revenue. But I also just said now whether it's the full 400 or I'm sorry, it's 400 would be annually. So yeah, you're going to see it's still reliant on mining until probably See, when I say the quarter, I'm thinking of them as a calendar year, even though they're a fiscal year. So for the sake of conversation, like until Microsoft hits, which is 1.9 billion annually, which comes out to a little over 150 million a month would be 1.8. So let's say 160 million a month, like I think until the next, not this quarter, but the quarter following where you have that install. So third quarter earnings for a calendar year filer, even though that would, it's different with their fiscal calendar, but not until August would we hear on that. So I think that addresses your question, but it gets back to the installs And they're diversifying away from it. They've showed the runway. They've guided for 3.4 billion of ARR by the end of December of next year, which, but again, that's like what they have installed. And if you. the 3.4 billion divided by 365, whatever that comes out to for one day's revenue, they could in theory on the last day of the year have that installed and still have met what they guided for. So hopefully that helps, Jeff.

Jeff: Yeah, I definitely appreciate it, man. Thank you.

₿itcoin ₿utcher: Yep. Basket Weaver, what do you got?

Speaker 3: Yeah, thanks for having me up. I'm just, I'm wondering, I've been kind of watching along here. Somebody had mentioned the satellite pictures of the factory. And I've been looking there to myself. Does it seem to others, as it does to me, that they really seem to be moving very slow on that site as far as, you know, getting buildings up, getting roads in and just getting things moving? It seems to be a very slow process that's actually happening there. I have a little bit of experience in doing this type of work, and I know what it usually takes to put up a complete building and put all new wire in it and put servers in it and stuff like that. And these guys just seem to be going way slower. I mean, we could, my company before I sold it, I mean, we could go in and do a 50,000 square foot building once the concrete is laden, the cement's in, you know, and the steel is done with, you know, 15 or 20 guys and get the servers in places for the engineers to come in and set up. And we'd be done in 30 days complete. And those buildings are actually smaller by comparison. And I don't know why it's taking them so long to do what they're doing. Now, one of the things that I know in the past from my business experience is I caught a part of the conversation and it kind of made a little bell go off in my head. Somebody had mentioned that they were doing only about 5% of their financing and 95% they were getting the money somehow. Does that sound correct?

₿itcoin ₿utcher: Can you repeat that? I heard 5% in reference to what, though, again.

Speaker 3: Yeah, on the financing side of it, I heard somebody mention that they were only doing 5% of their financing for the project. The other 95%, they had came up with either cash themselves or other methods. Is that correct?

₿itcoin ₿utcher: I think you're misunderstanding that. I think the 95% that was referenced was related to-- there was $5.8 billion for the 76,000 GPUs related to the Microsoft deal. And of that $5.8 billion, 95% of it was financed via the prepayment from Microsoft. and the GPU financing. So it was like $5.5 billion. So $1.9 was one year's prepayment from Microsoft, plus the $3.6 that they financed, meaning if $5.5 was covered, they only had to come up with an additional $300 in equity. So that was the 95%.

Speaker 3: So that they had three, they had to come up with 300.

₿itcoin ₿utcher: 300 million, but they don't have to come up with it all at once. Like you're paying for the, you're paying as the GPUs are delivered. I believe it's 30 days after delivery. They owe payment on that. I would have to double check the terms, but like there's not a lump sum payment due at once. It's as they come.

Speaker 3: And would that include that 1.9 that you were talking about?

₿itcoin ₿utcher: Well, the 1.9, it was a prepayment. So Microsoft already will have, I think that's just a lump sum that is delivered upfront by Microsoft, or that might be possibly portioned out with, that could be split up by the, GPUs that are delivered. I'd have to double check on that. I don't have an answer immediately on that.

Speaker 3: So are they totally responsible for the building costs themselves?

₿itcoin ₿utcher: Yeah, they own the land and the infrastructure and they're so as a reminder, their deal with Microsoft is infrastructure as a service. So they're constructing a data center that will cost them $3 billion. It's $15 million a megawatt for 200 megawatts. That's your $3 billion. And then the $5.8 billion is for the 76,000 GPUs. OK.

Speaker 3: Well, one of the things that just-- because it's happened to me in the past, and watching as it's been going along, I'm just wondering if they're dragging their feet on the money. the money that they already have, and that's slowing down the construction phases as they're going along. Because listening to that conference call today, they sound like they were being very careful and critical on how they're spending their money, which I completely get that, and that's wise business. But if you've already thought this business out and how you're going to lay it out, you already know the money you're going to need to put out. And if they're delaying, it's going to hurt them on the back end. I mean, the biggest ***** that I've been hearing about iron is the length of time it's getting them to get finished and actually get somebody in there and get rolling so they can start actually, you know, making money, rent the place.

₿itcoin ₿utcher: Yeah, I mean, as far as the money goes, I think they're adequately capitalized between their convertible note offering as well. Well, they had the direct equity offering in Q4 to wipe out the prior convertibles, and then they raised more convertible note proceeds. And I think the cash balance today was plus or minus $3 billion. And we said already that the cost of the data center for Microsoft was the 3 billion, but Horizon One, I believe, and Horizon Two are close to completion. Like they haven't installed the GPUs, but the data centers themselves, at least Horizon One was mostly funded already. So they should have... access cash for that for long lead items for Sweetwater or Oklahoma. So I mean, we were, if you caught us late, we were talking about what is it going to take for them to sign someone at Sweetwater. I would say they're not going to build a data center without consulting. They have to agree upon the specs with their final client who's going to be there. So I think that's part of it. So if you can have all the electrical infrastructure in place, and then while you're negotiating, agree upon a design, I'm sure that's part of that process. But if anything, I would argue Horizon 5, the 5 through 10, the 450 megawatts left in Childress, they may be dragging their feet a little bit, but yet to be seen. It's yet to be seen.

Speaker 3: Is this their first builds in the United States?

₿itcoin ₿utcher: No. I mean, they've already-- no, they already have the-- they built the mining data centers in Texas. So I'm not sure-- Childress, they already were operating 600 megawatts of mining. Now, Horizon One was their first liquid-cooled data center. So for AI, yes, but it's not their first data center in the US. And they have the British Columbia portfolio.

Speaker 3: OK, well, thanks for enlightening me. I, like the rest of you guys, got a lot of money invested in them. And I'm just a little concerned after what we've seen today. I've been following them on their conference calls. Somebody else made a comment, which kind of was my sentiment too, that I don't really feel like there's any really hard impact questions that are being thrown at these guys. To me, they're kind of softballs. Hopefully that's going to change and as they get better at presenting themselves, you know, they'll be under more rigor because it's going to come and they need to be prepared for it.

₿itcoin ₿utcher: Yeah, I mean, I think I alluded to earlier the Cypher's financing deal of their data center is trading right at 6% or below it. And then the team themselves. I mean, I think there's something to be said about they had guided for $2.5 billion debt on the deal and ended up getting $3.6 billion, which is a pretty large feat. They had additional $1.1 billion of leverage. And then I think the key part of that, though, is they financed it at 6% or below 6%, whatever it came out to where their prior GPUs that they had purchased for British Columbia were, I believe, closer to 8 or 9%. So I think progress is being made and whoever is financing them in the background sees the potential. And I think it's just whether we like it or not, just having the patience to See it through. I'm going to Basketweaver. I'm going to switch to Jared here. OK. Yeah, Jared.

Speaker 3: Thank you.

₿itcoin ₿utcher: Thank you. Jared, how are you?

Speaker 3: Hey, butcher. I know we're kind of going past midnight here, but I just wanted to say a couple of things real quick if you don't mind.

₿itcoin ₿utcher: Let it rip.

Speaker 3: So I got to really push back on kind of what was just said about. Iron taking their sweet time on Childress, like it's full steam ahead. I mean, if if these trucks and these workers can't find places to park like, you know, they're going, you know, they're going as hard as they can to get that thing up. And it's for Microsoft like this is this is a dream contract that they want to get right. And I do believe that they will get it right. Second point that I wanted to make, it makes total sense. to not touch the Bitcoin mining at Childress, although we would love them to do that, that would make that job site an absolute mess just based on what the current condition is trying to build horizon one through four. So although financially, I think nobody would argue that it would make more financial sense to start on it, logistically, they probably just can't do it. And for that, and to go along with that, Sweetwater is wide open. there's nothing operating there. It's fresh power. And they could have whoever it is that ends up signing that contract take as much as they want. And they can layer it up 200 megawatts at a time over whatever time period it takes to build it all out. But there's nobody there already. It's just it's it's powered land. So Just go there first. You know, let's like do this baby step, like one step at a time. Let's make this simple. 'Cause this is gonna be a, you know, a 10 year, 15 year operation to get Iron up to really where we think it can be. Sure, you know, as far as the stock price goes, yeah, I mean, it's hurt. It's hurt a lot lately, but who cares? Like I'm not in this thing for two months or three months. Like this is going to this is going to retire, you know, myself and my wife, my wife. And hopefully I'm going to be able to leave something for for my, my, my daughter. And that's why I'm in this. So we kind of let the story play out. They haven't given us any reason at all to doubt them. Period. Like, that's just it. This is not something that happens over a quarter or two quarters. So let it play out. Let them do what they do, and let's just sit here and talk about it. But let's not get ahead of ourselves with regards to expectations. They delivered exactly what they were supposed to deliver this quarter. Whether you want to believe it or not, they did. Where it's going to start to get interesting, I think, is towards the back half of the year when we really see their Microsoft ops ramp up and what that in turn says to the other hyperscalers on Iron's ability to execute. And that's why it's OK that it that they haven't announced Sweetwater in February before they even have power there. Just let it play out, let them execute for Microsoft. They're, I mean, they're kind of a big deal. So let's make sure they get that right. And then let's move on from there, move on from there. So that's all I have to say. But just that nonsense that we were hearing earlier about them, you know, sandbagging and taking their sweet time, like, give me a break. That's so far off base. I can't even like, there's no credence to that whatsoever. Thank you.

₿itcoin ₿utcher: Yeah, there's, I think everyone. I think everyone got a little ahead of themselves and when rumors get floated around about potential deal, there's excitement and people load up on short-term options or maybe they go an extra turn on margin, right or wrong, but I'm sure that's some of it. I haven't checked right now what it's at, but let's say it's at 33 and we were at 63 last Wednesday. It's probably somewhere in between, but.

Speaker 3: It's a bloodbath. It was terrible.

₿itcoin ₿utcher: Yeah, I mean, it just, but like it doesn't to me, like fundamentally we improved today. I the only thing I've said, someone said Dan's in here. If he is, Dan, we appreciate you and thank you for. what you do for us. But I don't have a problem saying, if I met Dan man to man, the only thing I would say to him is to the extent that we plan on using equity to raise funds to fund these infrastructure as service, whether it's GPUs or the data centers themselves, I think it's now his time to shine, because I think a lot of him and I think a lot of Will, but I think stateside, they have enough wheels in motion. They got the financing deal done. Ideally, they close a deal for Sweetwater, and it's time to sell this to the masses. And I personally want to see a new shareholder base so that we're not fighting with Jane Street every day, who just trades this off of volatility and treats it like a **** point. I mean, that's just my two cents on that. But it doesn't mean that they're not executing in the background and the fundamentals of the business are there. But I do know there's going to come a point where they're going to want to raise equity again because they have to maintain proper equity, debt to equity ratios, which is responsible and they have a fiduciary duty to protect the company. But it's time for Dan, he's welcome to come up here if he's in here still, but come stateside and show everyone how great we know that you are and do the circuit with Charles Payne. Unfortunately, it's just a selling game at this point, but at the same time, like... As I'm saying this out loud, yeah, I would feel great about us closing a deal right now. And if that was the next thing he was working on, I would understand that's why he's not coming in New York tomorrow to go on CNBC. There's priorities. So there's an element of trust. And I haven't sold anything yet, so I clearly trust the man. But I think he can understand where we're coming from. Yeah, there's going to be the memes of when deal and all that. It should be the right deal because the only thing worse than not getting the deal is getting a deal that's not received well and us getting **** on again and it going down to 25, 20 bucks a share and then having to sell equity at that price. I don't think that's going to happen, but just in an extreme scenario.

Speaker 3: I think the door's been open for the project level debt. It seems like with you know, the GPU financing and what Cipher just announced, you know, with their with their corporate debt. I do think that that's probably going to be something that's probably used more. And I'm surprised they didn't really talk about that a whole heck of a lot. But I don't see and I could be totally wrong. I just I just don't see these billion dollar at a time, you know, equity issuances, especially when we're talking about a 1.4 gigawatt site. I mean, it's going to be like you know, 1 billion every other month or something to get that thing going.

₿itcoin ₿utcher: Yeah, I think the thing I was most disappointed about was I think where we have a chance as shareholders, our company to stand out is I don't think people fully appreciate how profitable Canada is going to be because it is air cooled and it's retrofit and it's only a few million dollars additional to retrofit those as opposed to spending 10 million on a tier three or up to 15 million a megawatt with the redundancy. But I think next quarter is the quarter ideally, selfishly, because of some of my positions, yeah, it'd be nice to have Sweetwater signed by May. But the flip side of it is even if you didn't have it signed by then, I think we're going to see very quickly that iron is a different animal than Corweave, Nebius, and Oracle, because-- and I'm saying stuff that everyone already knows already, but they own the infrastructure, not paying a co-location fee. That's the primary driver, but just also have designed it where there's internal efficiencies that I don't think some of these other guys that are relying upon third parties enjoy the benefit of. But when I look at the operating income of some of those NeoClouds or Hypers, whatever you want to label them, it keeps showing a loss. And at some point, we're going to start printing cash from Canada. And I look forward to that day because I'll feel vindicated. David, you got anything to speak about? I invited you up, David. OAV. OK, I think I'm going to end this, guys. It's 15 minutes past midnight in the East Coast, and I have a butcher shop to open in five hours. Appreciate your time. I can't speak for Franz, but myself personally, I need a few days away from this just to walk away touch some grass, let the market do what the market's going to do. So I personally will not be on Sunday night. I don't know if Franz is still going to throw something, but it's also for our non-American listeners, the Super Bowl in the US. So I think this satisfies my contribution to the community for the week, and I'm in a probably take a few days off from this outside of chatting with people, but appreciate everyone's time. And I know things suck today, but listen to that call again and ignore the share price for a minute. And I think you'll come away realizing that they've delivered on their promises and added a new site. And there's still a lot of catalysts ahead of us. So Appreciate everyone's time tonight. I'm going to sign off. We'll talk soon. Thank you.