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    Applied Digital (APLD) Is Up 25.4% After $16 Billion AI Leases And ChronoScale Spin-Off - Has The Bull Case Changed?

    Simply Wall St·01/06/2026 05:21:03
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    • In recent days, Applied Digital has highlighted long-term AI data center growth, securing 15-year lease commitments totaling about US$16.00 billion and restructuring its operations by spinning off its cloud business into ChronoScale through a merger with Ekso Bionics.
    • This combination of multi-billion-dollar, recurring lease contracts and a sharper focus on AI infrastructure meaningfully reshapes how investors may view Applied Digital’s business mix and risk profile.
    • We’ll now examine how the ChronoScale spin-off and expanding AI lease pipeline could influence Applied Digital’s existing investment narrative.

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    Applied Digital Investment Narrative Recap

    To own Applied Digital, you need to believe that long-duration AI data center leases can eventually outweigh ongoing losses, high capital needs, and customer concentration. The latest US$16.00 billion in 15‑year lease commitments and the ChronoScale spin off reinforce the key near term catalyst of converting contracted capacity into stable cash flow, while the biggest risk remains the company’s leveraged, capital intensive build out and its reliance on a small set of hyperscaler tenants.

    The planned spin off of Applied Digital Cloud into ChronoScale, via the merger with Ekso Bionics, is especially relevant here, because it leaves Applied Digital more squarely focused on hosting and lease backed AI infrastructure. That sharper focus sits alongside the new Polaris Forge leases and Macquarie funding facility, which together concentrate the story around build execution, balance sheet discipline, and how quickly those long term AI contracts start to show through in reported results.

    Yet behind the eye catching lease totals, investors should be aware of the growing debt load and concentrated hyperscaler exposure...

    Read the full narrative on Applied Digital (it's free!)

    Applied Digital's narrative projects $755.7 million in revenue and $102.2 million in earnings by 2028.

    Uncover how Applied Digital's forecasts yield a $43.70 fair value, a 45% upside to its current price.

    Exploring Other Perspectives

    APLD 1-Year Stock Price Chart
    APLD 1-Year Stock Price Chart

    Thirty two fair value estimates from the Simply Wall St Community range from US$3.68 to US$43.70, underscoring how far apart views on Applied Digital really are. When you set those opinions against the company’s large, long term AI lease commitments with a few hyperscaler customers, it highlights why many readers may want to compare several different scenarios for future performance before deciding what Applied Digital is worth.

    Explore 32 other fair value estimates on Applied Digital - why the stock might be worth less than half the current price!

    Build Your Own Applied Digital Narrative

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.