Core Points - Nvidia-related stocks experienced a decline on Wednesday, with CoreWeave (CRWV.US) dropping over 5.4%, Arm Holdings (ARM.US) down more than 2%, Applied Digital (APLD.US) falling over 3%, and Recursion Pharmaceuticals (RXRX.US) and Nebius (NBIS.US) both decreasing by more than 5% [1] - Nvidia (NVDA.US) itself saw a slight decrease of 0.5% [1]

Core Viewpoint - Nvidia's holding concept stocks experienced a decline, with several key stocks dropping significantly [1] Group 1: Stock Performance - CoreWeave (CRWV.US) fell over 5.4% [1] - Arm Holdings (ARM.US) decreased by more than 2% [1] - Applied Digital (APLD.US) dropped over 3% [1] - Recursion Pharmaceuticals (RXRX.US) and Nebius (NBIS.US) both declined by more than 5% [1] - Nvidia (NVDA.US) itself saw a slight decrease of 0.5% [1]

Group 1 - Nvidia-related stocks experienced a decline, with CoreWeave (CRWV.US) dropping over 5.4%, Arm Holdings (ARM.US) down more than 2%, and Applied Digital (APLD.US) falling over 3% [1] - Recursion Pharmaceuticals (RXRX.US) and Nebius (NBIS.US) also saw declines exceeding 5% [1] - Nvidia (NVDA.US) itself decreased by 0.5% [1]

Core Insights - Applied Digital has secured a $5 billion equity funding partnership with Macquarie, which is expected to unlock $20 to $25 billion in total capital for building data centers [8] - The company is focusing on long-term contracts with hyperscalers, specifically targeting major players like Microsoft, Meta, Oracle, Amazon, and Google [2][10] - There is a significant demand for data centers, but the actual supply and construction timelines may not align with the numerous announcements in the industry [9][11] Company Strategy - The company has 700 megawatts of critical IT load currently under construction, with plans to continue growing this number over the next 18 months [5] - Applied Digital has established a robust construction process and secured its supply chain, which positions it well for rapid execution at scale [6][7] - The company emphasizes the importance of stable, non-cancellable 15-year leases to ensure a reliable revenue stream [10][11] Industry Context - There is a concern in the industry regarding the oversaturation of data center announcements, with some experts suggesting that the market may not need all the proposed facilities [8][9] - The construction of data centers is capital-intensive and subject to natural constraints related to power and supply chain logistics [9] - The demand for data centers is perceived as unlimited, but the actual operational capacity may lag behind the announcements [11]

Core Insights - Applied Digital stock experienced a significant increase after the announcement of a $5 billion, 15-year AI compute lease with a major US hyperscaler [1] Group 1 - The lease agreement involves 200 MW of capacity at the company's Polaris Forge [1]

Core Insights - Applied Digital signed a $5 billion lease with a U.S.-based hyperscaler for 200 MW at its Polaris Forge 2 campus in North Dakota, resulting in a 4% increase in its shares during premarket trading [1] Company Summary - The lease agreement is significant, indicating strong demand for data center capacity and services [1] - The Polaris Forge 2 campus is positioned to support the growing needs of hyperscale cloud providers [1] Industry Implications - The deal reflects the ongoing expansion in the data center industry, particularly driven by hyperscale operators [1] - The investment highlights the competitive landscape among data center providers to secure large-scale leases [1]

Core Insights - Applied Digital has signed a 15-year lease agreement for 200 MW of IT capacity at the Polaris Forge 2 Campus, generating approximately $5 billion in total contracted revenue [1] - The total leased capacity across Polaris Forge 1 and Polaris Forge 2 has now reached 600 MW, positioning the company as a leading builder of AI infrastructure in the U.S. [2] Lease Agreement Details - The lease is with a U.S.-based investment-grade hyperscaler and is designed to support AI and high-performance computing infrastructure [1] - The hyperscaler has a first right of refusal for an additional 800 MW, indicating potential future expansion [1] Campus Specifications - Polaris Forge 2 spans over 900 acres and is engineered for efficiency with a projected Power Usage Effectiveness (PUE) of 1.18 and near-zero water consumption [3] - The initial 200 MW will be phased in two buildings, expected to come online in 2026 and reach full capacity by 2027 [3] Company Achievements - The announcement follows record growth, including a 150 MW lease with CoreWeave and a $5 billion partnership with Macquarie Asset Management [4] - Applied Digital was recognized as the top company in the Dallas Business Journal's Fast 50, highlighting its rapid expansion in digital infrastructure [4] Strategic Vision - The company emphasizes its ability to deliver large-scale data centers quickly and efficiently, reshaping the AI infrastructure landscape [3] - The CEO stated that the company's AI Factories are redefining hyperscale infrastructure development, focusing on responsible and rapid construction [5]

Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool. ...

Core Insights - Applied Digital (APLD) shares have appreciated 46.8% in a month, outperforming the broader Zacks Finance sector's decline of 2.9% and the Zacks Financial – Miscellaneous Services industry's fall of 8.1% [1] - Year to date (YTD), APLD shares have returned 369.9%, significantly outperforming close peers like Riot Platforms (115.5% return) and Equinix (-12.5% return) [2] Company Performance - APLD's strong performance is attributed to robust demand for data center infrastructure and a growing focus on energy efficiency [6] - The company expects hyperscaler spending to exceed $350 billion in 2025, which bodes well for its prospects [6] - APLD shares are currently trading above the 50-day and 200-day moving averages, indicating a bullish trend [7] Business Developments - APLD's Data Center Hosting business provides energized infrastructure services to crypto mining customers, with a total hosting capacity of approximately 286 megawatts (MWs) [12] - The HPC Hosting business is expected to drive long-term top-line growth, with the Polaris Forge 1 facility designed to scale up to 1 gigawatt (GW) [13] - APLD has signed three lease agreements with CoreWeave to deliver 400 MW of critical IT load at Polaris Forge 1, with anticipated lease revenues of roughly $11 billion [14] Financial Outlook - The Zacks Consensus Estimate for APLD's fiscal 2026 loss is currently pegged at 36 cents per share, which has widened over the past 30 days [15] - The consensus mark for APLD's second-quarter fiscal 2026 loss is currently pegged at 11 cents per share, also widening over the past month [16] Valuation Concerns - APLD stock is currently considered overvalued, with a forward 12-month price/sales ratio of 27.32X compared to the industry's 3.72X [17] - The stock's valuation is stretched, which raises concerns for potential investors [20]

As of Oct. 20, 2025, two stocks in the information technology sector could be flashing a real warning to investors who value momentum as a key criteria in their trading decisions.The RSI is a momentum indicator, which compares a stock’s strength on days when prices go up to its strength on days when prices go down. When compared to a stock’s price action, it can give traders a better sense of how a stock may perform in the short term. An asset is typically considered overbought when the RSI is above 70, acc ...