APLD Doubles Down on AI/ML Hosting With Landmark CoreWeave Lease

Applied Digital APLD recently cemented its status as a rising force in AI/ML infrastructure with a landmark 250 MW, 15-year lease agreement with CoreWeave at its Ellendale, ND, campus. The deal, expected to generate approximately $7 billion in revenues, includes phased delivery of 100 MW by the fourth quarter of 2025 and 150 MW by mid-2026, with an option for an additional 150 MW. More than a traditional hyperscale project, this agreement validates APLD’s focus on GPU-centric and AI-optimized infrastructure. The Ellendale campus is built for power-dense deployments using liquid cooling and benefits from low-cost, abundant energy, making it ideal for compute-heavy workloads such as LLM training and inference.

This partnership reflects APLD’s strategic pivot from a hybrid operator to a pure-play AI/HPC infrastructure platform. The ongoing divestiture of its Cloud Services business underscores a sharper focus on delivering turnkey AI hosting environments, complete with tailored server, cooling, and power configurations. As it scales toward 1 GW capacity and eyes a REIT conversion, APLD is reshaping its identity beyond real estate, becoming a purpose-built enabler of next-gen AI infrastructure.

Competition Update

As APLD’s anchor tenant, CoreWeave CRWV exemplifies the AI-native hyperscaler model. The $7 billion deal not only secures compute capacity but highlights CoreWeave’s growing dominance in GPU-powered infrastructure. Recently, CoreWeave has reportedly raised over $1 billion to expand its data-center network and enhance GPU offerings. Its aggressive approach—working closely with NVIDIA and securing anchor sites like Ellendale—strengthens the company as a direct competitor in the AI infrastructure arms race.

Though better known for colocation, Equinix EQIX is increasingly deploying GPU-enabled setups tailored for AI use cases. In October 2024, Equinix announced a joint venture with GIC and CPP Investments to raise over $15 billion for expanding its xScale data centers in the United States, adding more than 1.5 gigawatts of capacity to meet growing AI and cloud demands. Equinix's strategic move underscores its commitment to supporting hyperscale clients. With this initiative, Equinix solidifies its position as a key player in the evolving digital infrastructure landscape.

APLD’s Price Performance, Valuation and Estimates

Shares of APLD have surged 70.4% in the year-to-date period against the industry’s decline of 3.5%.

From a valuation standpoint, Applied Digital trades at a forward price-to-sales ratio of 12.42, above the industry average as well as higher than its five-year median of 1.42. APLD carries a Value Score of F.

The Zacks Consensus Estimate for Applied Digitals’ fiscal 2026 earnings implies a 73.6% rise year over year.

The stock 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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