Applied Digital Corporation (NASDAQ: APLD) is ending the week the way only an AI-infrastructure “picks-and-shovels” stock can: with a bruising selloff, a sharp rebound, and investors arguing about whether the company is building the future—or building a debt tower during an interest-rate era that does not forgive.
On Friday, Dec. 19, APLD surged 16.53% to close at $27.85, after trading between $24.33 and $27.89 in the session, according to AAII’s recap. [1] That jump followed a volatile stretch where the market’s mood swung between “AI data centers are inevitable” and “okay, but who pays for all this concrete, copper, power, and cooling?”
Below is what’s driving Applied Digital stock right now—the latest company updates, near-term catalysts, Wall Street forecasts, and the risks that keep showing up in every serious debate about APLD.
Why Applied Digital stock moved this week: debt jitters, then financing momentum
One popular framing of the week is simple: APLD sold off on leverage anxiety, then bounced on financing headlines and a broader AI-sentiment tailwind.
A 24/7 Wall St. analysis published Dec. 20 describes APLD’s Friday surge as a recovery from a sharp midweek drop tied to investor concerns about rising debt in the AI data center sector. It points to a key headline: Applied Digital’s announcement of a development loan facility with Macquarie Group, with an initial $100 million intended to support pre-lease development work tied to a prospective hyperscaler relationship. [2]
The same 24/7 Wall St. piece argues that the rebound also rode the wave of “AI demand is still real” sentiment after Micron’s results—an example of how AI-infrastructure stocks can trade as a cluster, reacting to read-throughs from adjacent parts of the AI supply chain (chips, memory, servers, cloud capacity). [3]
That sensitivity cuts both ways. Earlier in December, Reuters highlighted how renewed “AI bubble” worries—sparked by Oracle’s outlook and the costs of AI buildouts—pulled down multiple AI-linked names, including AI infrastructure firms. [4]
The company behind APLD: building “AI factories” in North Dakota
Applied Digital is positioning itself as a developer and operator of high-performance, AI-optimized data center campuses—what the company calls “AI factories”—with flagship activity centered in North Dakota.
Polaris Forge 2: a $5 billion lease and a 1-gigawatt expansion option
In October, Applied Digital announced a ~15-year lease expected to represent about $5 billion in contracted revenue for 200 MW of critical IT load at its Polaris Forge 2 campus near Harwood, North Dakota. The tenant was described as a U.S.-based, investment-grade hyperscaler, and the hyperscaler also received a first right of refusal for up to 800 MW more, representing the full expansion potential of a 1 GW campus. [5]
Reuters also covered the deal, noting it as part of the race to secure infrastructure for AI demand, and reporting that the agreement would generate about $5 billion in contracted revenue over roughly 15 years. [6]
Polaris Forge 1: CoreWeave is the anchor tenant
Applied Digital’s earlier campus, Polaris Forge 1 in Ellendale, North Dakota, is closely associated with CoreWeave as a major tenant.
In its fiscal Q1 2026 results release (for the quarter ended Aug. 31, 2025), Applied Digital said it finalized a new lease agreement with CoreWeave for an additional 150 MW and stated that Polaris Forge 1 is now fully leased, bringing anticipated contracted lease revenue to approximately $11 billion for that campus. [7]
In November, the company said it achieved “Ready for Service” for a second 50 MW phase and fully energized the first 100 MW building at Polaris Forge 1, describing the broader campus as part of a 400 MW fully contracted deployment for CoreWeave under long-term leases. [8]
The headline on Dec. 18: Macquarie development loan facility and “advanced-stage” hyperscaler talks
The most immediate company update feeding APLD’s late-week momentum was this:
Applied Digital announced on Dec. 18, 2025, that it entered into a loan facility with Macquarie to fund pre-lease development costs—the early-stage work required to source, plan, develop, and begin construction of new campuses. [9]
Two details matter for investors:
- “Advanced-stage negotiations” with another hyperscaler.
Applied Digital said it is in advanced-stage negotiations with another investment-grade hyperscaler for multiple campuses, and that the initial $100 million in draws is intended to support development work related to those campuses. [10] - It’s explicitly pre-lease capital.
The facility is framed as a way to push projects forward before leases are finalized, while “aligning capital deployment with customer demand.” [11]
This kind of financing can be read in two opposite ways at once (welcome to infrastructure investing):
- Bull view: It helps the company move faster on scarce, high-quality sites without immediate equity dilution.
- Bear view: It underlines how much capital must be stacked—sometimes before revenue starts—making execution and leasing velocity absolutely critical.
Next catalyst: Applied Digital’s fiscal Q2 2026 earnings on Jan. 7, 2026
Applied Digital has already put a circle on the calendar.
On Dec. 18, 2025, the company announced it will report results for its fiscal second quarter ended Nov. 30, 2025, after market close on Wednesday, Jan. 7, 2026, followed by a management conference call at 5:00 p.m. Eastern Time. [12]
This matters because APLD often trades like a “progress report” stock: investors are not just watching revenue; they’re watching project milestones and lease ramp timing.
What investors will likely focus on in the Jan. 7 report
Based on how the company describes its model and where the market is fixated right now, likely pressure points include:
- Lease revenue ramp vs. one-time fit-out revenue. In fiscal Q1 2026, the company said much of the quarter’s revenue was driven by tenant fit-out services (with lease revenues expected to ramp later). [13]
- Construction and readiness milestones at Polaris Forge 1 and Polaris Forge 2 (timelines, power delivery, fit-outs, and any schedule risk). [14]
- Any update on additional hyperscaler leasing, especially given the company’s statement that it is in advanced-stage negotiations for multiple campuses and is using the Macquarie development facility to support that pipeline. [15]
Street expectations: losses expected, but the details vary by source
APLD remains in an investment/buildout phase, and analyst expectations still commonly assume losses near-term.
A Nasdaq article summarizing Zacks data says the Zacks Consensus Estimate for Applied Digital’s fiscal Q2 2026 loss is 10 cents per share, unchanged over the last 30 days (and it notes a larger loss in the year-ago quarter). [16]
Separately, TradingView’s analyst-forecast page lists an expectation that next quarter revenue could be around $86.66 million, with next quarter EPS expected around -$0.11, reflecting the market’s view that losses may persist even as revenue grows. [17]
The core debate: Applied Digital’s financing strategy and leverage
If APLD had a recurring character in its story arc, it would be: capital intensity.
The big one: $2.35 billion senior secured notes at 9.25%
In November, Applied Digital announced the pricing of a $2.35 billion offering of 9.250% senior secured notes due 2030, issued at 97%. The company said proceeds were intended to fund construction of major data centers at its Ellendale, North Dakota campus (Polaris Forge 1), repay amounts under a credit and guaranty agreement, fund debt service reserves, and pay transaction expenses. [18]
That’s not “normal growth-company” financing. That’s industrial-scale financing—appropriate for industrial-scale builds, but it increases the penalty for delays.
Balance sheet snapshots investors are reacting to
In its fiscal Q1 2026 results release, Applied Digital reported that as of Aug. 31, 2025 it had $114.1 million in cash, cash equivalents, and restricted cash, alongside $687.3 million in debt (and noted additional financing proceeds occurring after quarter end). [19]
And commentary in the current market conversation often emphasizes the mismatch between rapid buildout ambitions and available liquidity—exactly why headlines like a Macquarie facility can move the stock quickly. [20]
Analyst forecasts for APLD stock: big upside claims, big dispersion
Here’s the honest truth about Applied Digital stock forecasts right now: the range is wide enough to drive a truck full of server racks through. That tells you less about “who’s right” and more about the uncertainty in timing—lease ramps, campus deliveries, and cost of capital.
MarketBeat: Moderate Buy, but a lower average target
MarketBeat shows Applied Digital with a consensus rating of “Moderate Buy” based on 13 analyst ratings, and an average 12-month price target of $26.20, which it calculates as -5.92% downside from the referenced current price of $27.85. It also lists a high target of $41.00 and a low target of $7.00. [21]
TipRanks and TradingView: Strong Buy, targets around the low-$40s
TipRanks shows a Strong Buy consensus (based on the analysts counted in its window) and an average price target of $42.78, with a high forecast of $56.00 and low of $35.00. [22]
TradingView’s forecast page similarly shows a price target around $42.90, with max and min estimates in the mid-$50s and high-$30s range. [23]
Why targets disagree so much
This isn’t (just) analysts being dramatic. It’s structural:
- Some datasets weight targets from the last 12 months (including older targets from before major leasing/financing updates). [24]
- Others emphasize recent quarters where sentiment may be hotter and targets have been revised upward. [25]
In other words: APLD is in a regime where the “true value” depends heavily on execution timing—and timing uncertainty is where forecasts go to multiply.
Short interest and options activity: why APLD can move violently
APLD has become a stock where positioning can amplify price swings.
MarketBeat reported that as of Nov. 28, 2025, Applied Digital had 80.34 million shares sold short, representing 31.87% of the public float, with a short interest ratio (days to cover) of 3.0. [26]
Meanwhile, a TipRanks weekend update published Dec. 20 notes heavy options activity, with call trading outpacing puts and elevated implied volatility ahead of the Jan. 7 earnings report—conditions that can magnify moves in either direction. [27]
High short interest doesn’t guarantee a short squeeze, but it does mean unexpectedly positive news (a hyperscaler signing, a financing milestone, a delivery timeline beat) can force rapid repositioning.
The bull case for Applied Digital stock: contracted revenue, scale, and a sector with real constraints
The optimistic narrative for APLD is that it’s becoming a specialized “AI capacity merchant” at a moment when the world is capacity-constrained.
Key bull points that show up repeatedly:
- Large, long-duration contracts. The company has touted multi-year lease economics, including the ~$5 billion Polaris Forge 2 lease with a hyperscaler and deepening relationships at Polaris Forge 1. [28]
- A path from buildout to annuity-like revenue. The pitch is that once campuses are online and leased, revenues become more recurring with less incremental capex per dollar of revenue. [29]
- Ambitious operating targets. In its fiscal Q1 2026 materials, Applied Digital described expectations around scaling toward substantial net operating income over time as campuses become fully operational and additional leasing expands the platform. [30]
- Narrative momentum. Even on Dec. 20, bullish takes proliferated, including a Motley Fool piece arguing for significant long-term upside if the company executes and AI infrastructure demand continues climbing. [31]
The bear case: leverage, execution risk, and tenant concentration
Now the counterweight: the market is not wrong to interrogate APLD’s risk.
AAPL-style margins this is not; APLD is closer to a hybrid of developer, operator, and financier.
Common bear points:
- Leverage and refinancing sensitivity. The company has issued very large, relatively high-coupon debt (including 9.25% senior secured notes) and continues to rely on financing structures to move projects forward. [32]
- Execution is everything. Large campuses are complex: power delivery, equipment lead times, cooling systems, construction sequencing, and tenant timelines all must align. The company itself highlights these as material risks in forward-looking disclosures across releases. [33]
- Tenant concentration. Applied Digital has disclosed major exposure to key customers and leasing counterparties (CoreWeave is repeatedly referenced as central to Polaris Forge 1). That concentration can be powerful when it works—and painful if a major tenant changes plans. [34]
- Sector sentiment can flip fast. Reuters’ December reporting on AI bubble fears illustrates how quickly the market can punish AI infrastructure names when CapEx and profitability anxieties rise. [35]
A 24/7 Wall St. view published Dec. 20 puts this bluntly: the rally may be “ignoring” the reality that more financing does not automatically reduce risk—it can increase exposure if the cycle turns or timelines slip. [36]
Bottom line: Applied Digital stock is trading like a referendum on AI infrastructure financing
As of Dec. 20, 2025, Applied Digital stock sits at the intersection of three powerful forces:
- Real demand for AI compute capacity (and urgency from large customers to secure supply). [37]
- A capital stack that must keep working long enough for campuses to come online and lease economics to compound. [38]
- A market structure (short interest + options) that can exaggerate every surprise. [39]
The next major “truth serum” moment is Jan. 7, 2026, when the company reports fiscal Q2 2026 results and updates investors on operations—exactly where APLD’s story either tightens into a reliable execution narrative or reopens the question: is the growth worth the leverage? [40]
References
1. www.aaii.com, 2. 247wallst.com, 3. 247wallst.com, 4. www.reuters.com, 5. ir.applieddigital.com, 6. www.reuters.com, 7. ir.applieddigital.com, 8. ir.applieddigital.com, 9. ir.applieddigital.com, 10. ir.applieddigital.com, 11. ir.applieddigital.com, 12. ir.applieddigital.com, 13. ir.applieddigital.com, 14. ir.applieddigital.com, 15. ir.applieddigital.com, 16. www.nasdaq.com, 17. www.tradingview.com, 18. ir.applieddigital.com, 19. ir.applieddigital.com, 20. 247wallst.com, 21. www.marketbeat.com, 22. www.tipranks.com, 23. www.tradingview.com, 24. www.marketbeat.com, 25. www.tipranks.com, 26. www.marketbeat.com, 27. www.tipranks.com, 28. ir.applieddigital.com, 29. www.nasdaq.com, 30. ir.applieddigital.com, 31. www.fool.com, 32. ir.applieddigital.com, 33. ir.applieddigital.com, 34. ir.applieddigital.com, 35. www.reuters.com, 36. 247wallst.com, 37. www.reuters.com, 38. ir.applieddigital.com, 39. www.marketbeat.com, 40. ir.applieddigital.com
