Applied Digital (APLD) Stock Soars Over 270%: Can the AI Data Center High‑Flyer Keep Climbing in 2026?

As of December 9, 2025, Applied Digital Corporation (NASDAQ: APLD) has turned into one of the most explosive names in the AI infrastructure trade — and also one of the most controversial.

The stock trades around $33 per share, up roughly 3% on the day, giving Applied Digital a market cap near $9–9.5 billion on trailing twelve‑month revenue of about $174 million. Its 52‑week range runs from $3.31 to $40.20, and its beta above 7 makes it one of the most volatile tech names on the market. ^[1]

Over the past year, APLD has surged roughly 270%–350% depending on the measuring window and data provider. Zacks highlights a 272% gain over the last 12 months, while StockAnalysis notes that the stock is up about 353% year‑to‑date from $7.64 on January 1, 2025, to the mid‑$30s today. ^[2]

That kind of move puts APLD squarely in the crosshairs of momentum traders, long‑term AI bulls — and skeptics warning about valuation and execution risk.

What Applied Digital Actually Does

Applied Digital is not an AI software company. It’s the picks‑and‑shovels layer: a developer and operator of high‑performance computing (HPC) data centers designed for AI, machine learning, and blockchain workloads across North America. ^[3]

According to the company’s profile and investor relations materials, Applied Digital operates through three main segments: ^[4]

Data Center Hosting Business – long‑term hosting for crypto mining and other power‑hungry compute customers.
HPC Hosting Business – massive “AI Factory” campuses built for GPU‑dense AI workloads.
Cloud Services / AI cloud – GPU cloud services (a segment currently under strategic review).

The company was formerly Applied Blockchain, Inc. and rebranded as Applied Digital Corporation in 2022 when it shifted its focus from primarily crypto hosting to broader AI infrastructure. ^[5]

Its flagship projects are the Polaris Forge campuses in North Dakota — purpose‑built AI data centers that lean on:

Closed‑loop, direct‑to‑chip liquid cooling
Near‑zero water consumption
Over 200 days per year of “free cooling” thanks to the local climate

Applied Digital estimates that this design could save a 100 MW AI customer up to $2.7 billion over 30 years versus more traditional data centers, thanks to lower energy and cooling costs. ^[6]

2025: The Year the “AI Factory” Story Went Mainstream

The core of the APLD bull story is simple: build AI‑optimized data centers fast, lock in long‑term leases with hyperscalers and AI specialists, and finance the construction with a mix of equity, preferred capital, and high‑yield debt.

Several milestones in 2025 have super‑charged the narrative.

1. A $5 Billion Funding Partnership with Macquarie

In January 2025, Macquarie Asset Management (MAM) agreed to provide up to $5 billion in funding to Applied Digital’s HPC data center pipeline. Funds managed by MAM will invest up to $900 million in APLD’s Ellendale (Polaris Forge 1) campus, with an additional $4.1 billion available for future projects over the next 30 months. ^[7]

In October, Macquarie closed its first investment tranche, and in November 2025 Applied Digital announced a second $787.5 million draw from this facility to accelerate its AI Factory build‑out across North Dakota. ^[8]

This partnership not only provides enormous construction capital, it also effectively validates APLD’s business model in the eyes of many institutional investors.

2. A $5 Billion Lease with a U.S. Hyperscaler

On October 22, 2025, Applied Digital announced a $5 billion, 15‑year lease agreement with an unnamed investment‑grade U.S. hyperscaler at its Polaris Forge 2 campus near Harwood, North Dakota. The deal covers 200 MW of capacity, boosting APLD’s total leased load across Polaris Forge 1 and 2 to 600 MW. ^[9]

The lease gives the customer rights over up to 1 GW of eventual capacity at the site, subject to additional power allocations — essentially locking in a long runway of potential expansion. ^[10]

3. CoreWeave: 400 MW of Leased Capacity and ~$11 Billion in Revenue

Applied Digital’s Polaris Forge 1 campus is anchored by CoreWeave, the Nvidia‑backed AI cloud company. Over several leases, APLD has contracted 400 MW of critical IT load with CoreWeave, including a third 150 MW lease signed during fiscal Q1 2026. ^[11]

Management now expects about $11 billion in contracted lease revenue from Polaris Forge 1 alone over roughly 15 years. ^[12]

CoreWeave’s own growth and financing activity is heavily covered in the financial press, and several outlets identify Applied Digital as one of CoreWeave’s key infrastructure partners — alongside Nvidia and other AI ecosystem players. ^[13]

4. Polaris Forge 1: First 100 MW Building Fully Energized

On November 24, 2025, APLD announced that it had completed Phase II (the second 50 MW) of the first building at Polaris Forge 1, bringing the first 100 MW facility to full “Ready for Service” status on time. ^[14]

This building is the first of three contracted at Polaris Forge 1, all dedicated to CoreWeave under long‑term leases. Management emphasizes that hitting these milestones on schedule demonstrates Applied Digital’s speed‑to‑market and execution reliability in delivering high‑density AI infrastructure. ^[15]

5. A $2.35 Billion High‑Yield Bond Deal

To help finance build‑out at Polaris Forge 1, Applied Digital’s subsidiary APLD ComputeCo priced a $2.35 billion offering of 9.25% senior secured notes due 2030 in mid‑November. Proceeds will fund construction of 100 MW and 150 MW data centers (ELN‑02 and ELN‑03), refinance existing credit lines, and establish debt service reserves. ^[16]

This deal dramatically increases the company’s leverage and locks in a relatively high interest cost — a key talking point for bears worried about APLD’s capital structure.

6. Strategic Bet on Liquid Cooling via Corintis

On December 2, 2025, Applied Digital announced it had led a $25 million funding round for Corintis, a Swiss startup focused on direct‑to‑chip microfluidic cooling. Corintis claims its technology can deliver up to 3x lower chip temperatures than standard cold plates, enabling higher power densities and lower environmental impact. ^[17]

APLD describes liquid cooling as a “prerequisite” for ultra‑high‑density GPU systems and positions this investment as a way to stay ahead in AI‑optimized data center design. ^[18]

Financial Performance: Rapid Growth, Deep Losses

Applied Digital’s growth is real — but so are its losses.

Q1 FY 2026 (Quarter Ended August 31, 2025)

For fiscal Q1 2026, APLD reported: ^[19]

Revenue: $64.2 million (up 84% year‑over‑year from $34.8 million)
Data Center Hosting revenue: $37.9 million (up 9% YoY)
Tenant fit‑out revenue (HPC Hosting): $26.3 million (one‑time, lower‑margin installation work)
Net loss attributable to common shareholders:$27.8 million, or –$0.11 per share
Adjusted EBITDA:$0.5 million, down from $6.3 million a year earlier

Costs are rising even faster than revenue:

Cost of revenue jumped to $55.6 million, up 144% YoY, largely due to tenant fit‑out costs.
SG&A expenses climbed to $29.2 million, up 165% YoY, mostly driven by stock‑based compensation and headcount growth. ^[20]

As of August 31, 2025, the company held $114.1 million in cash and equivalents and $687.3 million in debt, not including an additional $362.5 million in financing secured after quarter‑end via Macquarie and other funding moves. ^[21]

On a trailing basis, StockAnalysis estimates: ^[22]

TTM revenue: ~$173.6 million
TTM net loss: ~$247.9 million
Market cap: ~$9.45 billion
Implied price‑to‑sales (P/S): mid‑50s

A recent 24/7 Wall St analysis notes that Applied Digital trades at roughly 50x sales with negative triple‑digit net margins, comparing it unfavorably to CoreWeave’s smaller losses and lower valuation multiple. ^[23]

Today’s Headlines (December 9, 2025): Momentum Meets Skepticism

Zacks: “APLD Stock Soars 272% in a Year: Will the Momentum Continue?”

A new Zacks piece published December 9 highlights that APLD has gained about 272% over the last year and questions how sustainable the rally is given “lumpy” earnings, stretched valuation, and tenant‑concentration risk. ^[24]

Combined with an earlier Zacks/TradingView analysis of APLD’s AI pivot, the research emphasizes that: ^[25]

APLD has successfully transitioned from a crypto‑centric host to an AI infrastructure specialist.
Its 12–14‑month build cycle, advanced cooling design, and North Dakota locations provide a cost and speed advantage.
However, earnings are volatile, and a significant portion of current revenue comes from one‑time tenant fit‑out work, not recurring lease income.

American Market News / MarketBeat: Consensus Rating “Moderate Buy”

Also on December 9, American Market News reported that 13 brokerages covering APLD have assigned it an average rating of “Moderate Buy”, with 1 sell, 11 buy, and 1 strong buy recommendation. The average 12‑month price target is $26.20, notably below the current share price. ^[26]

MarketBeat’s detailed forecast page echoes this, showing: ^[27]

Consensus rating: Moderate Buy (score ~2.92)
Average price target:$26.20
High target:$41
Low target:$7
Implied downside from ~$33.46: roughly –22%

The same report notes the stock’s strong positive news sentiment compared with its sector peers — a sign of how heavily APLD features in AI infrastructure discussions. ^[28]

24/7 Wall St: “CoreWeave Hits Profitability While Applied Digital Burns Cash”

A December 6 analysis from 24/7 Wall St draws a stark comparison between Applied Digital and CoreWeave: ^[29]

Applied Digital (Q1 FY26):
- Revenue $64.2M, up 84% YoY
- Operating loss $18.3M
- Cash $286.2M
- Price‑to‑sales ~50x
CoreWeave (Q3 2025):
- Revenue $1.36B, up 134% YoY
- Operating income $51.9M
- Backlog $55B
- Price‑to‑sales ~22x

The article concludes that while Applied Digital offers high‑beta exposure to AI infrastructure, its valuation and negative margins make it considerably riskier than its larger, more profitable counterpart.

Seeking Alpha & Others: Execution and Liquid Cooling

Recent Seeking Alpha coverage, aggregated by StockAnalysis, has been broadly constructive, highlighting: ^[30]

APLD as a “sleeping data center giant” with long‑term leases fueling strong revenue visibility.
The company’s liquid‑cooling strategy and ability to energize the first 100 MW at Polaris Forge 1 on schedule as signs it can execute at scale.
Q1 2026 as a “once‑in‑a‑generation breakout” in terms of contracted AI revenue, even though GAAP earnings remain negative.

At the same time, multiple Motley Fool articles have framed Applied Digital as a potential multi‑bagger AI stock while repeatedly flagging capital raises, share price pullbacks, and volatility as core risks. ^[31]

Analyst Forecasts: Strong Buy Ratings, Divergent Price Targets

Different aggregators paint slightly different pictures, but the common thread is bullish ratings with a wide spread in price targets.

Rating & Target Round‑Up

MarketBeat:
- 13 analysts
- Consensus: Moderate Buy
- Average target: $26.20 (–21.7% vs. ~$33.46) ^[32]
StockAnalysis.com:
- 11 analysts
- Consensus: Strong Buy
- Average target: $29.36 (–11.2% vs. current price) ^[33]
TradingView:
- 12 analysts over the last 3 months
- Consensus rating: Strong Buy
- Average price target:$42.90, with a range from $37 to $56 ^[34]
TickerNerd:
- 14 Wall Street analysts
- Median target:$42.50 (range $39–$56)
- Implied upside of ~32% from ~$32.11
- Ratings: 10 Buy, 0 Hold, 0 Sell ^[35]
StocksGuide:
- 16 analysts
- Average target:$41.31, with high $58.80 and low $39.39
- Implied upside ~29% from ~$32.11
- Rating split: 15 Buy, 1 Hold, 0 Sell ^[36]
Public.com (third‑party data):
- 10 analysts
- Consensus rating: Strong Buy
- Target: about $31, roughly flat to the then‑current price, likely based on slightly older data before the latest spike. ^[37]

In short:

Ratings are overwhelmingly positive (mostly Buy or Strong Buy).
Targets are all over the map, with some datasets suggesting 20%+ downside from today’s price and others implying 20–70% upside.

The divergence mainly reflects how fast the stock has run: many earlier price targets were struck when APLD was trading in the teens or low $20s and have not yet been updated.

Revenue and Earnings Forecasts

Consensus estimates compiled by various platforms point to:

FY 2026 revenue around $280–$310 million, up roughly 60–70% versus the last 12 months. ^[38]
Net margins improving but still negative, with one forecast showing a 2026 net margin of about –34%, better than the current triple‑digit negative margin but still firmly unprofitable. ^[39]
EPS for the most recent quarter came in at –$0.03 vs. –$0.13 expected, and analysts look for –$0.11 next quarter as lease revenue ramps and fit‑out work declines. ^[40]

Put simply: the Street expects strong top‑line growth, but APLD is not expected to be GAAP‑profitable in the near term.

The Bull Case: Why Optimists Love APLD Stock

Supporters of Applied Digital see it as a leveraged play on the AI data center super‑cycle. Their key arguments include:

1. Multi‑Billion‑Dollar Backlog and Visibility

Between CoreWeave’s 400 MW leases and the $5 billion lease at Polaris Forge 2, Applied Digital now touts roughly $16 billion in contracted lease revenue across its North Dakota campuses. ^[41]

That kind of backlog is rare for a company with sub‑$200 million trailing revenue and gives bulls confidence that revenue can compound rapidly as facilities are energized.

2. Differentiated Cooling and Location Economics

APLD’s direct‑to‑chip liquid cooling, waterless designs, and cold‑climate locations are not just talking points — they translate into lower operating costs and higher rack densities, which matter enormously for power‑hungry AI clusters. ^[42]

The company estimates its design can cut lifetime energy and cooling costs dramatically versus traditional data centers, while Corintis’ microfluidic technology potentially unlocks even higher density GPUs. ^[43]

3. Speed‑to‑Market as a Competitive Edge

Several recent press releases and analyst notes highlight Applied Digital’s ability to: ^[44]

Deliver 50 MW phases on schedule, with Building 1 at Polaris Forge 1 reaching full 100 MW RFS on time.
Maintain a 12–14‑month build cycle for new AI factories.
Bring hundreds of megawatts of capacity online just as hyperscalers scramble for power and space.

In a market where AI demand is outpacing grid and data center capacity, speed matters — a lot.

4. Blue‑Chip Partners and Investors

Backing from Macquarie Asset Management (up to $5 billion), long‑term leases with CoreWeave and an unnamed investment‑grade hyperscaler, and earlier funding from Nvidia‑linked entities all support the idea that APLD is plugged into the center of the AI infrastructure boom. ^[45]

5. High‑Beta Upside

With a beta above 7, APLD can move far more than the market when AI sentiment is strong. For traders and aggressive growth investors, that volatility is a feature, not a bug. ^[46]

The Bear Case: Cash Burn, Leverage, and Concentration Risk

Skeptics agree that Applied Digital is in a hot space — they just question whether the stock price already assumes too perfect an outcome.

1. Significant Cash Burn and Negative Margins

APLD’s TTM loss of roughly $248 million on $174 million of revenue, plus triple‑digit negative net margins, highlight just how far the company is from durable profitability. ^[47]

Q1 FY26 saw Adjusted EBITDA collapse to just $0.5 million as fit‑out revenue (low margin) and stock‑based compensation surged. ^[48]

2. Heavy Leverage and High‑Cost Debt

The $2.35 billion of 9.25% senior secured notes due 2030 and billions more in preferred equity financing via Macquarie create a complex, highly leveraged capital structure. ^[49]

Rising interest expense has already been visible in recent quarters, and bears worry that:

Any construction delays or tenant issues could strain coverage ratios.
Further expansion might require additional equity raises, diluting existing shareholders — something that has already triggered sharp sell‑offs when announced. ^[50]

3. Tenant Concentration

A huge share of APLD’s future lease revenue is tied to just two major customers:

CoreWeave (400 MW, ~$11B in leases) at Polaris Forge 1
An unnamed investment‑grade hyperscaler (200 MW, $5B lease) at Polaris Forge 2 ^[51]

If either customer slows deployments, renegotiates terms, or faces financial stress, Applied Digital’s growth trajectory could change quickly.

4. Valuation and “AI Bubble” Concerns

Trading at 50+ times sales with no profits and a highly leveraged balance sheet, APLD is priced like a hyper‑growth software stock, not a capital‑intensive data center builder. ^[52]

Several articles have framed Applied Digital within broader AI valuation debates, noting that its mega‑rally has already priced in a lot of optimism about AI demand and its ability to maintain an edge. ^[53]

5. Insider Selling

The December 9 analyst‑rating article also points out that insiders — including the CFO and a director — sold over 300,000 shares last quarter for more than $11 million in proceeds. While insider selling does not automatically imply trouble, it does raise questions when combined with an aggressive valuation. ^[54]

Key Things to Watch Going Into 2026

For investors tracking Applied Digital, several catalysts and risk markers will likely drive the story over the next 12–18 months:

Ramp‑Up of Lease Revenue
- Watch how quickly CoreWeave and the hyperscaler move from fit‑out to full lease payments at Polaris Forge 1 and 2. ^[55]
Execution on the 600+ MW Pipeline
- Any delays, cost overruns, or construction issues at the North Dakota campuses could hit both earnings and investor confidence. ^[56]
Balance Sheet Management
- How APLD manages its debt load, future draws from Macquarie, and potential equity raises will be crucial to long‑term shareholder returns. ^[57]
New Customer Wins and Geographic Expansion
- Management has hinted at a multi‑gigawatt pipeline and interest from additional hyperscalers; concrete announcements here could justify higher growth assumptions. ^[58]
Margin Progression
- As the business mix shifts from low‑margin fit‑out to higher‑margin recurring leases, investors will be watching whether gross margin and Adjusted EBITDA move sharply upward — or whether rising interest costs blunt those gains. ^[59]

Bottom Line: High‑Conviction Growth Story, High‑Risk Stock

Applied Digital has quickly evolved from a niche crypto host into a headline AI data center builder with:

Billions in contracted revenue,
Global infrastructure investors backing its build‑out, and
A front‑row seat to the GPU gold rush.

At the same time, it is:

Unprofitable,
Heavily leveraged, and
Priced for near‑flawless execution at a time when competition, financing conditions, and regulatory scrutiny around energy‑hungry AI campuses are all intensifying.

Most Wall Street analysts remain bullish on the business and rate the stock somewhere between Buy and Strong Buy, but their average price targets often lag the share price after APLD’s extraordinary 2025 run. ^[60]

For aggressive, high‑risk investors, Applied Digital represents a pure‑play bet on AI infrastructure with substantial upside if management delivers on its multi‑gigawatt roadmap and transitions from cash‑burning builder to cash‑generating landlord.

For more conservative investors, the combination of extreme volatility, heavy leverage, and rich valuation may be a reason to watch the story from the sidelines — or to demand a much wider margin of safety.

Either way, APLD is likely to remain front and center in the AI trade as 2026 approaches.

Disclaimer: This article is for informational and educational purposes only and does not constitute financial or investment advice. Always do your own research and consider consulting a qualified financial professional before making investment decisions.

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