NEW YORK, December 31, 2025, 10:43 ET
- Applied Digital plans to spin out its cloud unit and combine it with Ekso Bionics to form ChronoScale
- Ekso shareholders would hold about 3% of the combined company, with Applied owning about 97%, filings show
- The companies are working off a non-binding term sheet and target a first-half 2026 close
Applied Digital said it plans to spin out its cloud computing business and combine it with Ekso Bionics to form ChronoScale, a new platform built around graphics processing units (GPUs) used to run artificial intelligence workloads. Applied Digital shares were up about 2.4% at $24.65 in morning trading. 1
The proposed deal lands as demand for dedicated AI computing capacity pushes companies to secure scarce GPU supply. GPUs are specialized chips that speed up AI training and “inference,” the process of running models after they are built.
Investors have also tended to reward cleaner corporate structures in fast-moving parts of the AI supply chain, where growth rates and capital needs can look very different from more stable infrastructure businesses.
Ekso said in a filing that the term sheet contemplates Applied owning about 97% of the combined company after closing, with Ekso’s existing shareholders expected to hold about 3%, subject to dilution from any equity financing tied to the transaction. 2
Applied Digital said the transaction is expected to close in the first half of 2026, subject to due diligence, final documents, regulatory reviews and shareholder approvals. The company said ChronoScale expects to file a Form S-4 registration statement — the SEC document used to register shares issued in mergers — or Ekso may file a standalone proxy statement. 3
Applied Digital Cloud was among the first platforms to deploy Nvidia’s H100 GPUs at scale in 2023 and generated about $75.2 million in revenue over the 12 months ended Aug. 31, 2025, the company said. Ekso is best known for exoskeleton products used in medical and industrial settings. 4
The structure would effectively leave Applied Digital’s data center development business alongside a separately positioned GPU cloud platform, with Ekso’s current operations searching for their own path.
Rob Brown, an analyst at Lake Street, said the cloud unit was “largely a forgotten asset within Applied” and argued the spin-out could unlock value, according to a note published by TheFly. 5
Ekso shares surged on Tuesday, closing up about 103% at $11.08 after the announcement, according to an RTTNews report carried by Nasdaq. 6
ChronoScale would enter a crowded market for AI computing that ranges from big cloud providers to smaller specialist GPU operators, with customers often weighing price against access to scarce chips and predictable performance.
Applied Digital builds and operates data centers and sells “colocation,” which is essentially renting space, power and cooling so customers can run their own servers in a shared facility.
