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Can APLD Turn Power-Advantaged Sites Into an AI Data Center Edge?
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Key Takeaways
Applied Digital has 1.4 GW of contracted critical IT load representing about $36 billion in lease revenue.
APLD's secured sites could gain value as U.S. data-center power constraints intensify through 2030.
APLD targets about 500 MW of Critical IT load delivery annually to support long-term capacity growth.
Applied Digital (APLD - Free Report) is well-positioned to turn its power-advantaged sites into a meaningful edge in the AI data center market. The company focuses on locations with abundant, cost-competitive power, land and fiber, while North Dakota provides favorable electricity costs, free cooling opportunities and economic incentives. Its first-mover advantage in securing energy resources before the AI infrastructure boom further strengthens the company’s position. APLD is already converting this advantage into AI capacity, with approximately 1.4 GW of contracted critical IT load representing about $36 billion in contracted lease revenue.
U.S. grid may need approximately 100 GW of new capacity by 2030, with roughly half driven by data centers, while Boston Consulting Group estimates that the U.S. data-center power shortfall could exceed 45 GW by 2030. This growing power constraint could increase the value of APLD’s secured sites and create opportunities to expand AI infrastructure capacity.
However, APLD still depends on third-party power suppliers, exposing the company to potential power disruptions, price increases and volatility. This could raise operating costs and affect the economics of its AI data centers.
Power availability can be affected by construction and supply-chain delays. Securing power does not immediately translate into revenue-generating capacity, as APLD must complete substations, electrical infrastructure and other critical components before campuses become operational. Delays could therefore postpone capacity delivery and revenue generation.
Nonetheless, APLD’s power-advantaged locations provide a strong foundation for AI infrastructure growth. Its multi-gigawatt power pipeline and potential to deliver approximately 500 MW of Critical IT load annually could support long-term capacity and revenue expansion.
How APLD’s Rivals Are Building Their Power Advantage
TeraWulf (WULF - Free Report) is building its power advantage around control of scalable, power-advantaged sites and utility relationships. WULF’s brownfield redevelopment strategy leverages existing infrastructure and interconnection expertise, while its Chesapeake plan combines generation, battery storage and data-center load. This gives WULF a pathway to accelerate power availability and compete with APLD for large AI workloads.
WULF is also expanding across multiple U.S. power markets, reducing reliance on a single grid or interconnection process. WULF has 839 MW of leased capacity and a 2.1-GW controlled pipeline, including Muskie’s 1+ GW utility-powered campus tied to a 345/765-kV transmission backbone.
Core Scientific (CORZ - Free Report) is challenging APLD by pairing secured grid-connected power with behind-the-meter solutions across a diversified campus portfolio. CORZ has more than 1 GW of customer-contracted capacity and significant AMD expansion potential, with Pecos and Muskogee able to support up to 1 GW each. This gives CORZ multiple pathways to expand AI capacity as power becomes scarcer. CORZ is further strengthening its position by converting existing power capacity from Bitcoin mining to high-density colocation while selectively acquiring powered land. CORZ has about 1.1 GW of contracted billable capacity and more than 2 GW of new site opportunities.
APLD shares have plunged 39.6% over the past three months against the broader Zacks Finance sector’s 3.8% growth.
APLD's 3-Month Performance
Image Source: Zacks Investment Research
From a valuation standpoint, APLD appears overvalued, trading at a trailing 12-month price/sales (P/S) ratio of 12.05, above the Financial - Miscellaneous Services industry’s average of 2.58. The company carries a Value Score of F.
Price/Sales Ratio (TTM)
Image Source: Zacks Investment Research
APLD’s fiscal 2027 earnings outlook remains under pressure, as the Zacks Consensus Estimate is pegged at a loss of $1.09 per share, unchanged over the past 30 days. The projected loss is wider than the 91-cent loss recorded a year ago.
Image Source: Zacks Investment Research
APLD stock currently carries a Zacks Rank #4 (Sell).
View the Zacks #1 Rank List
Image: Bigstock
Can APLD Turn Power-Advantaged Sites Into an AI Data Center Edge?
Key Takeaways
Applied Digital (APLD - Free Report) is well-positioned to turn its power-advantaged sites into a meaningful edge in the AI data center market. The company focuses on locations with abundant, cost-competitive power, land and fiber, while North Dakota provides favorable electricity costs, free cooling opportunities and economic incentives. Its first-mover advantage in securing energy resources before the AI infrastructure boom further strengthens the company’s position. APLD is already converting this advantage into AI capacity, with approximately 1.4 GW of contracted critical IT load representing about $36 billion in contracted lease revenue.
U.S. grid may need approximately 100 GW of new capacity by 2030, with roughly half driven by data centers, while Boston Consulting Group estimates that the U.S. data-center power shortfall could exceed 45 GW by 2030. This growing power constraint could increase the value of APLD’s secured sites and create opportunities to expand AI infrastructure capacity.
However, APLD still depends on third-party power suppliers, exposing the company to potential power disruptions, price increases and volatility. This could raise operating costs and affect the economics of its AI data centers.
Power availability can be affected by construction and supply-chain delays. Securing power does not immediately translate into revenue-generating capacity, as APLD must complete substations, electrical infrastructure and other critical components before campuses become operational. Delays could therefore postpone capacity delivery and revenue generation.
Nonetheless, APLD’s power-advantaged locations provide a strong foundation for AI infrastructure growth. Its multi-gigawatt power pipeline and potential to deliver approximately 500 MW of Critical IT load annually could support long-term capacity and revenue expansion.
How APLD’s Rivals Are Building Their Power Advantage
TeraWulf (WULF - Free Report) is building its power advantage around control of scalable, power-advantaged sites and utility relationships. WULF’s brownfield redevelopment strategy leverages existing infrastructure and interconnection expertise, while its Chesapeake plan combines generation, battery storage and data-center load. This gives WULF a pathway to accelerate power availability and compete with APLD for large AI workloads.
WULF is also expanding across multiple U.S. power markets, reducing reliance on a single grid or interconnection process. WULF has 839 MW of leased capacity and a 2.1-GW controlled pipeline, including Muskie’s 1+ GW utility-powered campus tied to a 345/765-kV transmission backbone.
Core Scientific (CORZ - Free Report) is challenging APLD by pairing secured grid-connected power with behind-the-meter solutions across a diversified campus portfolio. CORZ has more than 1 GW of customer-contracted capacity and significant AMD expansion potential, with Pecos and Muskogee able to support up to 1 GW each. This gives CORZ multiple pathways to expand AI capacity as power becomes scarcer. CORZ is further strengthening its position by converting existing power capacity from Bitcoin mining to high-density colocation while selectively acquiring powered land. CORZ has about 1.1 GW of contracted billable capacity and more than 2 GW of new site opportunities.
APLD’s Share Price Performance, Valuation & Estimates
APLD shares have plunged 39.6% over the past three months against the broader Zacks Finance sector’s 3.8% growth.
APLD's 3-Month Performance
Image Source: Zacks Investment Research
From a valuation standpoint, APLD appears overvalued, trading at a trailing 12-month price/sales (P/S) ratio of 12.05, above the Financial - Miscellaneous Services industry’s average of 2.58. The company carries a Value Score of F.
Price/Sales Ratio (TTM)
Image Source: Zacks Investment Research
APLD’s fiscal 2027 earnings outlook remains under pressure, as the Zacks Consensus Estimate is pegged at a loss of $1.09 per share, unchanged over the past 30 days. The projected loss is wider than the 91-cent loss recorded a year ago.
Image Source: Zacks Investment Research
APLD stock currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.