Applied Digital APLD continues an aggressive capital spending program as it expands its AI data center footprint across multiple campuses. APLD is simultaneously developing five AI Factory campuses, including Polaris Forge 1, Polaris Forge 2, Delta Forge 1 and Delta Forge 2. Construction of a fourth building at Polaris Forge 1 has already begun before the third building reaches full utilization. On July 1, 2026, Applied Digital placed Phase 1 of the second building at Polaris Forge 1 into service, adding 75 megawatts of operational capacity and taking the campus to 175 megawatts of live capacity. However, this remains well below the 400 megawatts already leased to CoreWeave under long-term agreements, leaving more than half of the contracted capacity yet to contribute recurring lease revenue.
To support this infrastructure expansion, Applied Digital continues to rely on project-level financing rather than internally generated cash flows. The company raised $1.59 billion through senior secured notes due 2031 to fund the fourth building at Polaris Forge 1, following an earlier $300 million bridge facility for the same project and a $2.15 billion senior secured notes offering for Polaris Forge 2. An additional debt tranche remains to be placed for Polaris Forge 1, suggesting financing requirements are likely to remain elevated as construction progresses across its development pipeline.
APLD’s adjusted EBITDA was $44.1 million in the fiscal third quarter, while total debt stood at approximately $2.7 billion at the quarter’s end. The pace of capital deployment continues to outstrip current operating cash generation, leaving the company’s expansion strategy heavily reliant on external financing. With several AI campuses still under construction and financing needs expected to remain elevated, Applied Digital is likely to remain in an investment-heavy phase until a larger portion of its contracted capacity begins generating recurring lease revenue and cash flows.
APLD Faces Stiff Competition
Applied Digital competes with IREN Limited IREN and TeraWulf WULF in expanding AI infrastructure to serve hyperscale customers. Like Applied Digital, IREN continues investing in high-performance computing capacity, while TeraWulf is expanding its digital infrastructure through AI-focused data center projects. However, compared with IREN and TeraWulf, Applied Digital is pursuing a broader multi-campus expansion strategy, resulting in larger upfront capital commitments and greater reliance on external financing as new capacity is brought online.
APLD’s Share Price Performance, Valuation & Estimates
Applied Digital shares have surged 34.8% year to date, outperforming the broader Zacks Finance sector’s decline of 9% and the Zacks Financial-Miscellaneous Services industry’s increase of 4.5%.
APLD Stock’s Performance
Applied Digital stock is trading at a forward 12-month price/sales of 12.06X compared with the broader sector’s 2.81X.
APLD’s Valuation
The Zacks Consensus Estimate for fiscal 2026 loss is pegged at 70 cents per share, unchanged 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 #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Beyond Nvidia: AI’s Second Wave Is Here
The AI revolution has already minted millionaires. But the stocks everyone knows about aren’t likely to keep delivering the biggest profits. AI’s second wave is moving from infrastructure to implementation and these companies are at the forefront of this transition, positioned to become what Amazon and Google were to the internet era.
See Stocks Now >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Applied Digital Corporation (APLD) : Free Stock Analysis Report
IREN Limited (IREN) : Free Stock Analysis Report
TeraWulf Inc. (WULF) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
