Key Points
Applied Digital signed a 15-year, 400 MW lease with CoreWeave worth $11 billion.
Shares are up more than 35% as analysts raise targets and investors reposition APLD as a serious AI infrastructure provider.
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Applied Digital (Nasdaq: APLD) shares soared more than 35% this morning, rallying sharply after the company posted fiscal Q4 2025 results last night and revealed a massive leasing deal with CoreWeave (Nasdaq:CRWV), a leading AI infrastructure company. Revenue came in at $38 million, beating consensus estimates of $37.12 million, while the company reported an adjusted EPS loss of $0.03, much better than the anticipated $0.16 loss.
This post-earnings spike reflects growing investor confidence in Applied Digital’s ability to scale its AI-focused data center operations — and validates its transition from a niche player to a more serious hyperscale infrastructure provider.
Why The Stock Is Ripping
The main driver of the stock’s surge was the announcement of a 15-year lease agreement with CoreWeave to deliver 250 megawatts of capacity at Applied Digital’s flagship Polaris Forge 1 campus in North Dakota. CoreWeave has already exercised an option for another 150 megawatts, bringing the total to 400 megawatts under contract — a deal expected to generate $11 billion in revenue over its term.
CEO Wes Cummins called the lease a “defining moment,” noting that it positions Applied as a category leader in building hyperscale “AI factories.” The company also said it has completed the onboarding process with two additional investment-grade hyperscalers and is in advanced negotiations for more large-scale campus leases.
Applied Digital will begin recognizing revenue from the Polaris Forge 1 technical fit-out as early as this quarter — even before the lease revenue kicks in — providing a short-term financial lift. Executives also highlighted improvements in build timelines (cut nearly in half to 12–14 months), an optimized supply chain, and an ability to deliver capacity faster than peers — all while capitalizing on low-cost, energy-efficient sites in the Dakotas.
Applied Digital expects to break ground on one or two new campuses before the end of 2025, and it raised $270 million post-quarter to support project financing and growth.
Wall Street Is Taking Note
Wall Street is responding quickly to Applied Digital’s execution. This morning two notable actions stood out:
Kevin Dede (H.C. Wainwright) raised his price target from $12 to $15, reiterating his Buy rating.
John Todaro (Needham) also raised his price target with a Buy rating and a $16 price target.
They join a chorus of bullish analysts who are on the hype train. APLD has a consensus Buy rating with a mean price target of $17.22, according to S&P Capital IQ.
Wall Street now views APLD not as a speculative AI adjacent player, but as a potential hyperscale infrastructure backbone provider for the AI era. With a multibillion-dollar runway and more hyperscaler deals in the pipeline, the re-rating may just be getting started.
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