What Happened: Applied Digital signed two approximately 15-year lease agreements with AI hyperscaler CoreWeave on Monday to provide 250 megawatts (MW) of critical IT load at its data center site in North Dakota.
CoreWeave holds an option to expand capacity by an additional 150 MW, bringing the total potential load to 400 MW. Applied Digital said it expects to generate approximately $7 billion in revenue over the contract period.
"We believe these leases solidify Applied Digital's position as an emerging provider of infrastructure critical to the next generation of artificial intelligence and high-performance computing," said Wes Cummins, chairman and CEO of Applied Digital.
Applied Digital shares closed Monday up 48.5% at $10.14, according to Benzinga Pro. The stock is continuing to move higher on Tuesday. Needham maintained a Buy rating and raised the price target from $10 to $12, and HC Wainwright & Co. maintained a Buy and lifted its price target from $7 to $12.
It’s also worth noting that Applied Digital filed a mixed securities shelf registration and secondary offering related to the resale from time to time of up to 39.7 million shares by selling stockholders following the strong surge in shares.
APLD Price Action: Applied Digital shares were up 8.29% Tuesday, trading at $10.97 at the time of publication. Applied Digital has a 52-week high of $12.48 and a 52-week low of $3.01, according to Benzinga Pro.
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