Why Applied Digital (APLD) Is Up 18.1% After Securing $11B in AI Infrastructure Lease Deals

• In August 2025, CoreWeave announced it finalized a new lease agreement for an additional 150MW at Applied Digital’s Polaris Forge 1 Campus in North Dakota, raising Applied Digital’s total anticipated contracted lease revenue to about US$11 billion from major AI infrastructure clients.
• This lease agreement highlights Applied Digital’s accelerated pivot to powering AI technologies and marks growing industry recognition by specialized ETF providers targeting the sector’s future.
• We’ll now examine how inclusion in new leveraged ETFs and the expanded long-term CoreWeave lease could reshape Applied Digital’s investment narrative.

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Applied Digital Investment Narrative Recap

To be a shareholder in Applied Digital, you have to believe in the company's high-stakes transformation into an AI data center leader, with the bulk of future value anchored on securing long-term, multi-billion-dollar contracts for AI infrastructure rather than legacy crypto mining. The recent CoreWeave lease expands Applied Digital’s recurring revenue base and supports its efforts to lower customer concentration risks, potentially impacting the company’s biggest short-term catalyst of scaling its AI-driven revenue streams. However, the concentrated nature of its major contracts still carries a significant risk if customer relationships shift.

Among recent announcements, the finalized follow-on equity offering of US$200 million directly relates to the company’s expansion strategy. This capital raise underpins Applied Digital's ability to fund rapid AI campus development, which is critical for meeting obligations tied to large-scale, multi-year leases, such as the latest CoreWeave agreement that embodies the company’s evolving investment case.

But in contrast to the surge in AI leasing, investors should also recognize the outsized exposure to just a few large customers...

Read the full narrative on Applied Digital (it's free!)

Applied Digital's narrative projects $755.7 million revenue and $102.2 million earnings by 2028. This requires 73.7% yearly revenue growth and a $263.2 million earnings increase from -$161.0 million.

Uncover how Applied Digital's forecasts yield a $20.00 fair value, a 18% upside to its current price.

Exploring Other Perspectives

Simply Wall St Community members have listed 29 different fair value estimates for Applied Digital, from as low as US$2.11 up to US$24 per share. While shareholder expectations vary widely, many are considering the potential and pitfalls of Applied Digital's dependence on a handful of major hyperscaler contracts, reminding you to weigh multiple viewpoints as you assess future prospects.

Explore 29 other fair value estimates on Applied Digital - why the stock might be worth less than half the current price!

Build Your Own Applied Digital Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Applied Digital research is our analysis highlighting 1 key reward and 3 important warning signs that could impact your investment decision.
• Our free Applied Digital research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Applied Digital's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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