Applied Digital's Stock Surges 2.56% on $1.04 Billion Volume Spike, Entering Top 100 Most Actively Traded as $2.35 Billion Debt Offering Sparks Mixed Investor Sentiment

Market Snapshot

Applied Digital (NASDAQ: APLD) closed 2.56% higher on November 14, 2025, with a trading volume of $1.04 billion—a 38.63% surge from the prior day—ranking it among the top 100 most actively traded stocks. The volume spike followed the company’s announcement of a $2.35 billion senior secured notes offering, priced at 97% of face value with a 9.25% coupon. Despite a post-market decline of 3% after the offering news, the stock managed to close the day in positive territory, reflecting mixed investor sentiment around the financing move and broader AI infrastructure market dynamics.

Key Drivers

The $2.35 billion notes offering by APLD ComputeCo LLC, a subsidiary of Applied Digital, emerged as the primary catalyst for the stock’s volatility. The proceeds will fund construction of two data centers at the company’s North Dakota campus (100 MW and 150 MW facilities), repay existing debt under a February 2025 credit agreement with Sumitomo Mitsui Banking Corporation, and establish debt service reserves. The offering, priced at a 97% discount to par, signals elevated borrowing costs relative to the coupon rate, reflecting the high-yield nature of the debt. Investors appear divided: while the capital infusion supports long-term infrastructure growth, concerns about leverage expansion and potential dilution—exacerbated by a concurrent $787.5 million equity raise from Macquarie Asset Management—have triggered short-term jitters.

The market’s reaction also underscores skepticism toward AI infrastructure spending amid broader sector headwinds. The stock’s 26% weekly decline, its steepest since early 2024, coincided with a guidance cut from data-center client CoreWeave and heightened scrutiny of AI asset valuations. Analysts note that Applied Digital’s aggressive buildout strategy, while backed by long-term leases with CoreWeave and an unnamed U.S. hyperscaler, relies heavily on external financing. The company’s debt-to-equity ratio, currently at 0.67, is expected to rise post-closing, raising questions about its ability to manage costs as interest rates remain elevated.

Institutional activity, however, suggests lingering confidence in the company’s growth trajectory. Mitsubishi UFJ Asset Management Co. Ltd. increased its stake by 26.6% in Q2 2025, while Macquarie’s equity investment provides non-dilutive funding for the Polaris Forge 1 and 2 campuses. Wall Street analysts maintain a “Moderate Buy” consensus, with an average 12-month price target of $26.20, though some have downgraded the stock due to execution risks and macroeconomic uncertainty. The company’s strategic pivot from Bitcoin mining to AI-focused data centers, coupled with its Polaris Forge model’s capacity to scale toward 1 GW per site, remains a key differentiator for bulls.

The offering’s structure further highlights operational and financial risks. The notes are secured by first-priority liens on APLD Compute’s assets and project accounts, with Applied Digital providing completion guarantees for the North Dakota facilities. While this collateralization mitigates counterparty risk, it also ties the company’s liquidity to the timely execution of construction milestones. Any delays in completing the 400 MW Polaris Forge 1 campus—currently on track to deliver $11 billion in lease revenue over 15 years—could strain cash flow and investor confidence.

MarketBeat data reveals short interest above 20% of the float, amplifying volatility as both long and short positions react to headlines. The stock’s 311% year-to-date gain contrasts with its recent 25% weekly drop, reflecting the polarizing nature of Applied Digital’s business model. While its long-term revenue pipeline—$16 billion over 15 years from CoreWeave and the hyperscaler—positions it as a beneficiary of AI demand, near-term execution risks and capital-intensive growth remain focal points for investors. The company’s upcoming earnings report and progress on construction timelines will likely dictate the next phase of its stock performance.