Applied Digital (US:APLD) Yahoo Finance·2026-01-24 18:28Core Insights - The artificial intelligence (AI) sector is transitioning towards optimizing data center capacity rather than just focusing on advanced chips or AI models, with significant investments from hyperscalers, cloud providers, and enterprise customers [1] - Applied Digital is positioned as a key player in AI infrastructure, showing potential for substantial long-term returns [1] Demand Visibility - Applied Digital has secured nearly 600 megawatts of data center capacity across its Polaris Forge 1 and Polaris Forge 2 campuses, projecting approximately $16 billion in lease revenue over the next 15 years [3] - CoreWeave has leased 400 megawatts at Polaris Forge 1, while 200 megawatts at Polaris Forge 2 is leased to an unnamed "investment-grade" hyperscaler, enhancing revenue and cash flow predictability for the company [3] Expansion Potential - The Polaris Forge campuses are designed for significant scalability, with each capable of expanding to at least 1 gigawatt, potentially reaching 2 gigawatts or more, depending on power and infrastructure availability [4] - The company is also developing Delta Forge 1, a 430-megawatt AI data center campus, indicating confidence in ongoing demand for data centers [4] Robust Financials - In the second quarter of fiscal 2026, Applied Digital reported a 250% year-over-year revenue increase to $126.6 million [5] - Wall Street estimates project revenue to grow to approximately $346.7 million in fiscal 2026 and around $546 million in fiscal 2027, suggesting strong financial momentum [5] Investment Consideration - Applied Digital's strong demand visibility, planned capacity expansion, and rapid revenue growth make it an attractive investment opportunity [6]