AI Boom Fuels APLD Stock Rally
Applied Digital Corporation (NASDAQ:APLD) has grabbed Wall Street’s attention, with its stock soaring nearly 50% in June 2025 following a major 250MW AI data center lease with CoreWeave. The deal, announced on June 2, 2025, has sparked excitement on platforms like X, where investors are buzzing about APLD’s pivot to AI infrastructure. This surge highlights the growing demand for AI-driven data centers, positioning APLD as a key player in the tech sector.
Strategic Shift to AI Infrastructure
Applied Digital, traditionally known for crypto mining infrastructure, is capitalizing on the AI boom. The CoreWeave deal involves leasing 250MW of data center capacity in North Dakota, a significant step in its high-performance computing (HPC) strategy. This follows a 22% year-over-year revenue increase in Q3 2025, with $35.2 million from data center hosting and $17.8 million from cloud services, as reported by Yahoo Finance.
Financial Moves Bolster Growth
APLD’s recent financial strategies have strengthened its position. On May 20, 2025, the company secured a $150 million convertible preferred stock financing, enhancing its financial flexibility for infrastructure expansion. Additionally, its planned sale of the Cloud Services Business, classified as ‘held for sale’ on April 10, 2025, aims to streamline operations and focus on AI and HPC, according to TipRanks. These moves have boosted investor confidence.
Analyst Optimism and Market Sentiment
Analysts are bullish on APLD, with Citizens JMP initiating coverage on May 22, 2025, with an Outperform rating and a $12 price target, citing its potential in AI data centers. Needham reiterated a Buy rating with a $10 target in April, per Yahoo Finance. Posts on X reflect strong retail investor enthusiasm, though some warn of a potential dip due to high valuations, with a 5.5x net book value and 10x price-to-sales ratio.
Risks and Challenges Ahead
Despite the optimism, APLD faces risks. Its stock has a 35% short interest, with 2.56 days to cover,
No responses yet