Applied Digital Stock Surges Amid $11 Billion CoreWeave Deal and AI Mega-Campus Plans

Applied Digital (APLD) has surged to 52-week highs due to a $11 billion CoreWeave deal and plans to build a $3 billion AI mega-campus. Analysts have called it a strong buy, but investors are debating if it's the backbone of AI infrastructure or a speculative bet. The Motley Fool recommends investing in the company's AI mega-campus, citing its potential for massive returns.

Applied Digital Corporation (APLD) has seen its stock surge to 52-week highs following a significant deal with CoreWeave and ambitious plans for an AI mega-campus. The company recently finalized a 150MW lease agreement with CoreWeave, bringing its total anticipated contracted lease revenue to nearly $11 billion Applied Digital Finalizes New 150MW Lease with CoreWeave^[1]. This deal, along with two initial 15-year leases, brings the total contracted capacity to 400MW for CoreWeave’s AI and high-performance computing initiatives.

The new 150MW data center is set to be operational in 2027, with the first 100MW data center from the initial May agreements scheduled to be ready in Q4 2025, and the second 150MW building expected to be operational in the middle of 2026. The Polaris Forge 1 Campus, where these data centers will be located, is designed to eventually scale up to 1 gigawatt Applied Digital Finalizes New 150MW Lease with CoreWeave^[1].

Analysts have called Applied Digital a strong buy, but investors are debating whether the company is the backbone of AI infrastructure or a speculative bet. The Motley Fool recommends investing in the company's AI mega-campus, citing its potential for massive returns Applied Digital (APLD) Is Up 34.3% After Landing $11B CoreWeave Lease to Expand AI Data Centers^[2].

The recent deal with CoreWeave underscores Applied Digital's growing role in powering large-scale AI infrastructure. However, the company's reliance on a small number of hyperscaler customers and its significant debt load remain key risks to monitor. Applied Digital's narrative projects $755.7 million in revenue and $102.2 million in earnings by 2028, requiring 73.7% yearly revenue growth Applied Digital (APLD) Is Up 34.3% After Landing $11B CoreWeave Lease to Expand AI Data Centers^[2].

The company's AI mega-campus plans, which include a $3 billion investment, are seen as a strategic move to capitalize on the surging demand for AI infrastructure. However, the success of these plans hinges on the company's ability to secure additional financing and maintain its debt-to-equity ratio Applied Digital (APLD) Is Up 34.3% After Landing $11B CoreWeave Lease to Expand AI Data Centers^[2].

In conclusion, Applied Digital's recent deal with CoreWeave and plans for an AI mega-campus present significant opportunities for growth. However, investors should closely monitor the company's reliance on a small number of customers and its debt load to assess the potential risks and rewards.