APLD is growing revenue at 139% year-over-year and has beaten earnings expectations in three consecutive quarters with an average positive surprise exceeding 100%, ranking it as the top growth performer among peers; however, free cash flow is deeply negative at 469% of revenue consumed, business quality is below minimum thresholds, 29% of the float is sold short, and a put/call ratio of 1.37 signals significant market skepticism—the investment case is a direct bet on whether the exceptional growth trajectory can eventually justify the cash consumption and silence the short thesis.
Thesis pillars
- Exceptional Revenue Growth Leadership→Stable
- Severe Cash Burn Quality Floor Breach→Stable
- High Short Interest Market Skepticism↓Deteriorating
- +1 more pillar — see the Why tab for full reasoning
Applied Digital Corporation (APLD) Stock Analysis
Oversold Bounce setup
Technology · Information Technology Services
Sell if holding. Engine safety override at $20.39: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 4.4/10. Specifically: High short interest: 20%; Elevated put/call ratio: 2.15; Below-average business quality.
Applied Digital builds and operates data center campuses for high-performance computing and AI workloads, leasing capacity to a small number of hyperscale and cloud customers. In fiscal 2025 its data center business had four customers, one of which accounted for 93% of revenue.
Sell if holding. Engine safety override at $20.39: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 4.4/10. Specifically: High short interest: 20%; Elevated put/call ratio: 2.15; Below-average business quality. Chart setup: Oversold RSI 25, near Bollinger lower, volume surge. Score 4.4/10, moderate confidence.
Passes 5/9 gates (clean insider activity, news events none recent, earnings proximity 82d clear, semi cycle peak clear, materials cycle peak clear). Fails on weak momentum and death cross (50MA < 200MA). Suitability: speculative.
About Applied Digital Corporation
About Applied Digital Corporation
Applied Digital recorded a $231.1 million net loss in fiscal 2025 while building out roughly 286 MW of Data Center Hosting and HPC Hosting capacity in Jamestown and Ellendale, North Dakota. Data Center Hosting, which rents power-based space to crypto mining customers, generated 100% of fiscal 2025 continuing-operations revenue, with a single customer accounting for 93%. HPC Hosting signed its first leases - two agreements totaling 250 MW with one customer - in May 2025.
Applied Digital earns revenue by leasing energized data center capacity: the Data Center Hosting Business rents space sized to customers' power requirements to crypto mining operators under a five-year contract with roughly 2.5 years remaining, while the HPC Hosting Business signs long-term leases - roughly 15 years - to host GPU clusters and other high-performance compute infrastructure for AI customers, with the first two Polaris Forge 1 buildings (100 MW and 150 MW) leased in May 2025 for a combined 250 MW. The company funds capital-intensive construction through debt, including the February 2025 SMBC Credit Agreement, an Ellendale loan from Starion Bank, and a Cornerstone Bank loan, alongside equity issuances and convertible notes. A separate Cloud Services Business, which rents third-party co-location space and cloud computing equipment to AI and machine-learning developers, was classified as held for sale in fiscal 2025 and reported in discontinued operations. Competitors include Digital Realty, Equinix, NTT, Bitdeer, and Riot Platforms.
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Beyond its per-segment customer concentration, Applied Digital's physical footprint is itself concentrated: both operating sites, and the entire Polaris Forge 1 buildout, sit in North Dakota, exposing the company to that state's regulatory framework, market conditions, and natural-disaster risk with no operational diversification to fall back on. The 10-K separately flags that recently imposed U.S. tariffs on imported electrical infrastructure components and construction materials - inputs the company says it cannot yet predict the full effect of - could delay completion of the HPC and AI facilities the business depends on for its next stage of revenue growth, compounding the single-state concentration with an import-cost variable outside the company's control.
See also: Technology · Information Technology Services
From Applied Digital Corporation's most recent 10-K filing, extracted October 11, 2026.
Recent developments
updated 2026-10-16Recent Developments — Applied Digital Corporation
Latest news
- NEWS Why Is Applied Digital Stock Falling on Thursday? — benzinga Oct 15, 2026 negative
- NEWS Applied Digital Stock Sinks: What's Fueling the Move? — benzinga Oct 14, 2026 negative
- NEWS Applied Digital Stock Is Falling Tuesday: What's Going On? — benzinga Oct 13, 2026 negative
- NEWS Morgan Stanley Maintains Equal-Weight on Applied Digital, Raises Price Target to $41 — benzinga Oct 12, 2026 positive
- NEWS SpaceX, Micron, AMD and More: 5 Stocks Investors Couldn't Stop Buzzing About This Week — benzinga Oct 10, 2026 neutral
Generated 2026-10-16T11:52:10Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- HIGHCustomerone customer 93% of revenue93%10-K Item 1A: 'One of such customers accounted for 93% of our revenue during fiscal year 2025.'
- HIGHCustomerfour customers accounting for 100% of revenue100%10-K Item 1A: 'this business segment was comprised of four customers accounting for 100% of our revenue from continuing operations'
Material Events(8-K, last 90d)
- 2026-04-16Item 5.02LOWEquity incentive (MIP Unit) awards granted April 9, 2026 to executive officers tied to the proposed Ekso Bionics contribution and exchange transaction through a Holdco subsidiary. Compensation-related; no departure cited.SEC filing →
- 2026-03-13Item 5.02LOWAmended and restated Performance Stock Unit award for President Jason Zhang on March 10, 2026, correcting a scrivener's error so existing Polaris Forge 1 data centers count toward hurdles. No departure cited.SEC filing →
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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Rating Breakdown
4 floor-breakers
Hyper-growth tech sacrificing current profitability for scale. Floor tripped because model treats negative margins uniformly; the growth dimension tells the other half of the story.static
Volatile — 8.0% daily ATR makes tight stops impractical. Position-size conservatively.static
Price action weak — below key moving averages, no momentum carry. Needs a base before trend-continuation setups apply.static
Ranks in the bottom of its industry peers on the composite signal. Better names in the same sector exist.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Sell if holding. Engine safety override at $20.39: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 4.4/10. Specifically: High short interest: 20%; Elevated put/call ratio: 2.15; Below-average business quality. Chart setup: Oversold RSI 25, near Bollinger lower, volume surge. Prior stop was $18.96. Score 4.4/10, moderate confidence.
Take-profit target: $28.52 (+39.9% upside). Prior stop was $18.96. Stop-loss: $18.96.
Concentration risk — Customer: one customer 93% of revenue (93.0%); Concentration risk — Customer: four customers accounting for 100% of revenue (100.0%); DATA_ISSUE: analyst_target_implausible (raw $64.27 vs price $20.39 — ratio 3.2×). Rejected, falling back to technical TP..
Applied Digital Corporation trades at a P/E of N/A (forward -26.0). TrendMatrix value score: 5.5/10. Verdict: Sell.
20 analysts cover APLD with a consensus score of 4.1/5. Average price target: $64.
What does Applied Digital Corporation do?Applied Digital builds and operates data center campuses for high-performance computing and AI workloads, leasing...
Applied Digital builds and operates data center campuses for high-performance computing and AI workloads, leasing capacity to a small number of hyperscale and cloud customers. In fiscal 2025 its data center business had four customers, one of which accounted for 93% of revenue.