Applied Digital just pulled off the kind of deal that makes investors sit up and pay attention. The company’s stock rocketed 54% in a single day—and honestly, there’s a pretty solid reason why.
Here’s the deal: Applied Digital, which builds and operates data centers for AI companies, just signed a massive contract with CoreWeave, the AI infrastructure heavyweight. We’re talking two 15-year leases that are expected to generate $7 billion in revenue. That’s not chump change.
Think of it this way—CoreWeave is basically saying, “We trust you to house our AI infrastructure for the next decade and a half.” That’s the kind of vote of confidence that makes Wall Street go wild.
The specifics? Applied Digital will deliver 250 megawatts of computing power to CoreWeave at its data center campus in North Dakota, with an option for another 150 megawatts. The first 100 MW facility goes live in Q4, with a second 150 MW building ready mid-2026. A third building is already in the planning stages for 2027.
CEO Wes Cummins called it a “foundational step” for the company, and he’s not wrong. This deal essentially validates Applied Digital’s entire business model—that there’s massive demand for AI infrastructure, and they’re positioned to capture it.
Now, here’s the reality check: Applied Digital isn’t profitable yet. In its most recent quarter, revenue hit $54 million (up 22% year-over-year), but the company posted a $36 million net loss. So this is still a growth story, not a cash cow.
But here’s why investors are excited: the data center industry is booming, and Applied Digital is becoming a key player. With $7 billion in locked-in revenue from CoreWeave, the company has serious runway to scale up and eventually turn profitable.
The stock’s median price target sits at $10 per share, which would actually be slightly down from where it closed after the 54% surge. So analysts might be playing catch-up here. Either way, this is a company worth keeping on your radar if you’re betting on AI infrastructure growth.
