NEW YORK, December 31, 2025, 14:00 ET — Regular session
- Applied Digital shares were up about 4.6% in afternoon trading, outpacing a slightly softer broader market.
- Northland and Lake Street reiterated bullish ratings ahead of the company’s Jan. 7 earnings call, according to Benzinga.
- Investors continue to parse Applied Digital’s plan to spin out its cloud unit and merge it with EKSO to form ChronoScale.
Applied Digital Corporation shares rose about 4.6% to $25.20 in afternoon trading on Wednesday, after a burst of upbeat analyst coverage ahead of the company’s earnings next week. Northland Capital Markets analyst Mike Grondahl maintained an Outperform rating with a $40 price target, while Lake Street analyst Rob Brown reiterated a Buy rating and kept a $45 target, Benzinga reported. Northland also named Applied Digital its top pick for 2026, citing demand for power from hyperscalers — the largest cloud providers — and a potential move toward a REIT, or real estate investment trust, structure.
The timing matters for a stock that has traded like a proxy for the artificial intelligence buildout. Investors have been fixated on who can secure electricity and data-center capacity as demand surges for GPUs — graphics processing units, the chips that power many AI training and inference workloads.
Applied Digital sits at the intersection of that trade, straddling data-center development and cloud compute. Traders are now weighing whether a planned corporate reshuffle will sharpen the story for investors and, in turn, reshape how the market values the businesses.
Applied Digital said on Dec. 29 it signed a non-binding term sheet — a preliminary outline of deal terms — with EKSO Bionics to combine its Applied Digital Cloud unit with EKSO and launch ChronoScale, a standalone GPU-accelerated cloud platform for AI workloads. The company said the move would separate its accelerated compute platform from its data-center ownership and development business, while its colocation unit rents space and power to customers in its facilities. Applied Digital said it would own about 97% of ChronoScale and expects a first-half 2026 close; Chief Executive Wes Cummins said the platform aims to “deliver accelerated compute at scale,” and the company said the cloud unit deployed Nvidia’s H100 GPUs at scale in 2023 and generated about $75.2 million of revenue in the 12 months ended Aug. 31, 2025. Applied Digital Corporation
A U.S. securities filing posted the same day said the deal is subject to further diligence and definitive documentation. The filing also said ChronoScale expects to file registration and proxy materials, depending on how the transaction is structured.
The stock’s move came against a modestly weaker tape, with the tech-heavy Invesco QQQ Trust and the SPDR S&P 500 ETF both down about 0.2% on the day.
Large data-center landlords Digital Realty and Equinix were slightly lower, underscoring that Applied Digital’s gains were driven by company-specific headlines and analyst activity rather than a broad sector rally.
Investors are still looking for answers that go beyond the headline. The term sheet is non-binding, meaning key items — governance, capital structure, and the final economics of the separation — can still shift before any shareholder vote.
The next big checkpoint is next week’s quarterly update. Applied Digital’s investor calendar shows its fiscal second-quarter 2026 earnings call is scheduled for Jan. 7 at 5:00 p.m. Eastern.
Traders will be listening for specifics on the ChronoScale timeline and the likely sequencing of regulatory filings and shareholder approvals. Any color on funding needs and capital spending plans will also matter, given the capital intensity of data-center buildouts.
Until there is more clarity, Applied Digital’s shares are likely to stay sensitive to incremental updates on deal execution, customer demand for GPU compute, and broader sentiment toward AI infrastructure plays.
