IREN Ltd. (NASDAQ:IREN) shares slipped in early Thursday trading after the company unveiled plans for a $6 billion capital raise, sparking a debate on Wall Street over whether the move positions the firm for the next AI infrastructure boom—or risks diluting shareholders.

EMJ Capital founder Eric Jackson defended the strategy on X, arguing investors are misreading the move. Critics, including short-seller Jim Chanos, warned the financing could weigh on returns, but Jackson said the market is overlooking IREN’s long-term bet on power capacity and AI demand.

Jackson noted the company’s $9.7 billion deal with Microsoft Corp. (NASDAQ:MSFT) uses less than 10% of IREN’s total power capacity. “The market sees dilution. I see infrastructure,” he wrote.

He added that just as Amazon.com, Inc. (NASDAQ:AMZN) built warehouses ahead of demand, IREN is building power infrastructure to capture the next wave of artificial intelligence growth.

The $6 Billion Filing

IREN filed an updated 424B5 prospectus on Thursday, expanding its at-the-market (ATM) program to $6 billion. That replaces a prior $1 billion supplement and equals nearly half the company’s market cap.

The company has already sold over 66 million shares for roughly $1 billion under its previous ATM. Skeptics noted that IREN raised its December 2026 ARR guidance but did not reaffirm its $500 million digital revenue ARR outlook.

Chanos: Show Me The Returns

Chanos responded directly to Jackson on X, challenging the bullish case.

“Ok, but do you see returns…?!” Chanos asked, arguing that since the Microsoft deal was announced, adjusted earnings-per-share estimates for IREN’s fiscal 2027 have fallen by 90%, while fiscal 2028 estimates have declined by 60%. “These deals are uneconomic,” he added.

Chanos also noted that Goldman Sachs cut IREN’s fiscal 2026–2028 earnings per share estimates further on Thursday following the announcement.

Short Interest in IREN Rises

Short interest in IREN increased from 40.94 million to 41.95 million shares, accounting for 13.24% of the public float. Based on the average daily volume of 46.49 million shares, it would take about one day for short sellers to cover their positions.

IREN Price Action

IREN shares were trading down 6.91% at $40.81 at the time of publication on Thursday, according to Benzinga Pro data.

Photo by T. Schneider via Shutterstock