Applied Digital Stock Price (APLD) Rally Continues Pre-Market on CoreWeave Deal

Applied Digital Corporation (NASDAQ: APLD) is riding a wave of investor enthusiasm as its stock price continues its meteoric rise, fuelled by a ground-breaking deal with CoreWeave, a specialized cloud services provider backed by Nvidia.

The Applied Digital stock price closed out Monday's session at $10.14, for a remarkable 48.46% on the day, and this morning is following suit. The bulls are building on yesterday's impressive gain following the announcement of a 250MW AI data center lease agreement with CoreWeave with a pre-market push of 8.68%, moving APLD above $11.

This dramatic upswing underscores the market's confidence in Applied Digital's strategic pivot towards becoming a key player in the burgeoning artificial intelligence and high-performance computing (HPC) infrastructure sectors.

The momentum began building earlier in the year. Looking at a broader timeframe, the stock has delivered a 156.06% gain over the past 12 months. To put this in perspective, the SPY ETF, which tracks the S&P 500, has gained a comparatively modest 12.3% during the same period, highlighting the magnitude of APLD's outperformance.

The foundation of this surge lies in the two 15-year lease agreements, valued at approximately $7 billion, signed with CoreWeave on June 2, 2025. These agreements commit Applied Digital to providing CoreWeave with 250 megawatts (MW) of AI data center capacity in North Dakota. This long-term commitment not only secures significant future revenue streams for Applied Digital but also firmly establishes the company as a critical infrastructure provider in the rapidly expanding AI landscape. CoreWeave, known for providing clients with access to data centers equipped with Nvidia chips tailored for AI model development, represents a powerful partner for Applied Digital.

Historically known as Applied Blockchain, the Dallas, Texas-based company has strategically shifted its focus from crypto mining infrastructure to providing GPU computing solutions for critical workloads related to AI, machine learning, and other high-performance computing tasks. The company designs, constructs, and manages data centers specifically tailored to support these demanding HPC applications. This transformation has proven prescient, positioning Applied Digital to capitalize on the exploding demand for AI infrastructure.

Wall Street analysts remain optimistic about APLD's future prospects. Current analyst projections range from a minimum price target of $7.00 to a maximum of $18.00. With the current price hovering around $11, and the consensus target at $12.50, analysts continue to see further upside potential, even after the rally.

However, as with any high-growth stock, potential investors should carefully consider the risks involved. The AI infrastructure market is intensely competitive, and Applied Digital faces challenges from established players with deeper pockets and broader market reach. Execution risk is also a factor, as the company needs to successfully deliver on its commitments to CoreWeave and effectively manage its data center operations. Furthermore, the dependence on a single major client like CoreWeave introduces a degree of concentration risk. Any disruption in the relationship with CoreWeave could have a significant negative impact on Applied Digital's revenue and profitability.

Despite these risks, Applied Digital's strategic shift, the landmark deal with CoreWeave, and the growing demand for AI infrastructure have created a compelling narrative. The company's ability to execute its vision and capitalize on the opportunities in the AI market will likely determine its long-term success.