Will Applied Digital's Second Campus Unlock the Next Leg of Growth?

Applied Digital’s APLD second North Dakota development, Polaris Forge 2, represents the next phase of the company’s expansion into AI-focused data center infrastructure. The project begins with an initial 300 megawatts of IT load and is designed to scale toward a full gigawatt as additional power becomes available on the grid. Following the success of Polaris Forge 1, which is fully leased at 400 megawatts and carries roughly $11 billion dollars in long-term contracted revenues, the second campus reflects the company’s effort to extend its capacity footprint in a similar demand environment. The Zacks Consensus Estimate for fiscal 2026 revenues is pegged at $280.9 million, offering a reference point for how the company’s broader platform may begin to evolve as new capacity prepares for deployment.

Polaris Forge 2 enters the development cycle at a time when demand for liquid-cooled, high-density AI infrastructure continues to rise. Power-ready sites remain limited across the industry, and customers evaluating large-scale deployments are prioritizing locations with clear construction schedules and the ability to support advanced cooling requirements. The second campus is designed to align with those conditions as demand trends into 2026 and 2027.

However, the development of Polaris Forge 2 will unfold alongside broader factors that influence large infrastructure projects. Applied Digital has 700 megawatts under construction across other sites and a 4-gigawatt active development pipeline that may move forward in the coming year. This creates exposure to conditions such as labor availability, material lead times, financing costs and shifts in regional power markets. These variables can affect scheduling and spending. The extent to which Polaris Forge 2 progresses within these constraints will determine how meaningfully it contributes to APLD’s next phase of growth.

APLD Faces Stiff Competition

Applied Digital operates in a market where both emerging and established providers are expanding capacity to support AI workloads. Among its peers, Riot Platforms RIOT is moving beyond its crypto-focused base. With its planned high-performance computing facilities, Riot Platforms aims to exceed one gigawatt of future capacity as demand evolves. Equinix EQIX also remains one of the sector’s largest operators, with Equinix running a global network of more than 260 data centers and expanding its xScale portfolio for hyperscale customers requiring power-dense environments. While Riot Platforms and Equinix benefit from broader scale and mature customer ecosystems, APLD’s focus on purpose-built, liquid-cooled infrastructure and its rapid development approach at sites like Polaris Forge 2 offers a differentiated path.

APLD’s Share Price Performance, Valuation & Estimates

Applied Digital shares have skyrocketed 179.7% year to date, outperforming the broader Zacks Finance sector’s return of 11.2% and the Zacks Financial-Miscellaneous Services industry’s modest appreciation of 11.2%.

APLD Stock’s Performance

Applied Digital stock is overvalued, with a forward 12-month price/sales of 15.01X compared with the broader sector’s 8.93X. APLD has a Value Score of F.

APLD’s Valuation

The Zacks Consensus Estimate for the fiscal 2026 loss is pegged at 31 cents per share, narrowing by six cents over the past 30 days. Applied Digital reported a loss of 80 cents per share in the previous year.

Applied Digital Corporation Price and Consensus

Applied Digital Corporation price-consensus-chart | Applied Digital Corporation Quote

APLD currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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