Applied Digital Announces 250MW AI Data Center Lease With CoreWeave in North Dakota
- Secured approximately $7 billion in total revenue over 15-year lease agreements
- CoreWeave retains option for additional 150MW expansion, showing growth potential
- Strategic location with access to abundant, low-cost energy
- Campus designed to scale up to 1 gigawatt over time
- Energy-efficient climate enables rapid capacity deployment
- Significant construction and development timeline extending into 2026-2027
- Large capital investment required for infrastructure development
- Heavy reliance on single customer (CoreWeave) for revenue
Insights
Applied Digital secures transformative $7B, 15-year deal with CoreWeave for 250MW AI data center capacity, significantly strengthening its competitive position in AI infrastructure.
Applied Digital's landmark agreement with CoreWeave represents a game-changing development in the AI infrastructure landscape. The $7 billion total revenue expected over the approximately 15-year term translates to roughly $467 million annually - a substantial recurring revenue stream that provides exceptional visibility into the company's long-term financial trajectory.
What makes this deal particularly compelling is the strategic positioning of the Ellendale campus. The facility's design addresses the critical bottlenecks in AI deployment: power capacity, deployment speed, and location efficiency. The campus's planned 1 gigawatt scale puts it among North America's most ambitious data center projects, with the current agreement securing utilization for a significant portion (250MW) of that capacity.
The implementation timeline is aggressive yet achievable - with the first 100MW expected online by Q4 2025 and the additional 150MW by mid-2026. CoreWeave's option for another 150MW further validates the facility's value proposition and provides a clear path to additional upside.
From an industry perspective, this deal represents a significant vote of confidence in Applied Digital's execution capabilities. CoreWeave, a specialized AI infrastructure provider, has selected Applied Digital for this massive deployment over numerous competing options. This partnership positions Applied Digital as a key enabler in the AI compute infrastructure ecosystem - a sector experiencing exponential growth as generative AI applications proliferate.
The strategic value of securing a purpose-built, high-density compute facility with access to abundant, low-cost energy cannot be overstated in today's AI landscape, where power consumption and cooling requirements have become critical constraints for large language model deployment.
This lease agreement represents a transformative financial development for Applied Digital. The $7 billion in anticipated revenue over the approximately 15-year term provides extraordinary visibility into the company's long-term financial trajectory and dramatically changes its business outlook.
To put this in perspective, this single agreement translates to an average of $467 million in annual revenue over the contract period. The long-term nature of these leases creates a stable, predictable revenue stream that significantly de-risks Applied Digital's business model and provides a solid foundation for future growth investments.
The phased implementation approach is financially prudent - with the first 100MW data center coming online in Q4 2025, followed by 150MW in mid-2026. This staged deployment allows for distributed capital expenditure while beginning to generate revenue within an 18-month timeframe.
CoreWeave's option for an additional 150MW represents meaningful potential upside not yet reflected in the announced $7 billion figure. If exercised, this option would increase the total contracted capacity by 60%, with corresponding revenue implications.
From a competitive positioning standpoint, this agreement establishes Applied Digital as a significant player in the AI infrastructure space. The company's ability to secure such a substantial commitment from CoreWeave demonstrates its capability to deliver mission-critical infrastructure at scale - a key differentiator in the increasingly competitive AI data center market.
The economics of this deal highlight the profound value creation potential in purpose-built AI infrastructure. The revenue per MW metrics implied by this agreement reflect the premium economics available to providers who can effectively address the specific requirements of AI compute workloads.
DALLAS, June 02, 2025 (GLOBE NEWSWIRE) -- Applied Digital Corporation (Nasdaq: APLD), a designer, builder and operator of next-generation digital infrastructure for HPC applications, has entered into two approximately 15-year lease agreements with CoreWeave, the AI Hyperscaler™.
Under the lease agreements, Applied Digital will deliver 250 megawatts (MW) of critical IT load to host CoreWeave's artificial intelligence (AI) and high-performance computing (HPC) infrastructure at its Ellendale, North Dakota data center campus. Over the approximately 15-year term, Applied Digital anticipates generating approximately
Pursuant to the lease agreements, CoreWeave also retains the option to access an additional 150 MW of critical IT load at Ellendale, positioning the campus as a scalable hub for expanding AI and HPC workloads. “We believe these leases solidify Applied Digital’s position as an emerging provider of infrastructure critical to the next generation of artificial intelligence and high-performance computing,” said Wes Cummins, Chairman and CEO of Applied Digital. “As demand for AI accelerates exponentially, we believe that we are uniquely positioned to deliver substantial returns while supporting the evolving and dynamic needs of these rapidly evolving sectors. We view CoreWeave as an ideal partner as we accelerate our growth and innovation.”
Applied Digital’s Ellendale campus is believed to be one of the most ambitious data center developments currently underway in North America. Intended to be purpose-built for next-generation workloads, the facility combines large-scale power capacity with rapid deployment capabilities – both critical for AI and HPC clients.
The Ellendale campus was planned to be engineered for high-density compute and designed to scale up to 1 gigawatt over time. The two approximately 15-year lease agreements mark a foundational step in unlocking the campus’s full potential.
“We believe Ellendale is more than a development project — it’s a launchpad for the future of AI infrastructure,” added Cummins. “We intend for this platform to put us in a strong position to support early demand while continuing to grow alongside our customers. Through these newly signed long-term leases with CoreWeave, we are taking a step forward in our strategic expansion into advanced compute infrastructure.”
Applied Digital designed Ellendale for the speed and efficiency of deployment, prime location, AI innovative design, and access to abundant, low-cost energy. The energy-efficient climate is intended to further enable Applied Digital to meet the rapid capacity demands, positioning both the region and the company as emerging leaders in the AI data center ecosystem. Applied Digital expects the first 100 MW data center for CoreWeave to be ready for service in the fourth quarter of calendar 2025. The second building, which is expected to house a 150 MW data center, is currently under construction and is expected to be ready for service in the middle of 2026. Additionally, CoreWeave holds an option for the third 150 MW building, which is currently in the planning stages, anticipated to be ready for service in 2027.
Applied Digital’s Ellendale campus is designed to host 400 MW of critical IT load. Ellendale has 1+ gigawatts of power capacity currently under various stages of load study, allowing the campus to expand its power capacity to support additional AI and HPC data center infrastructure development.
About Applied Digital
Applied Digital (Nasdaq: APLD) develops, builds and operates next-generation data centers and infrastructure. Different by design, the Company’s purpose-built facilities are engineered to unleash the power of accelerated compute and deliver secure, scalable and sustainable digital hosting, enabling CSaaS and GPU-as-a-Service solutions. Backed by deep hyperscale expertise and a robust pipeline of available power, Applied Digital accommodates AI Factories and beyond to support AI/ML, blockchain and high-performance computing (HPC) workloads.
CAUTION ABOUT FORWARD-LOOKING STATEMENTS
This press release contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995 regarding, among other things, future operating and financial performance, product development, market position, business strategy and objectives and future financing plans. These statements use words, and variations of words, such as “will,” “continue,” “build,” “future,” “increase,” “drive,” “believe,” “look,” “ahead,” “confident,” “deliver,” “outlook,” “expect,” “project” and “predict.” Other examples of forward-looking statements may include, but are not limited to, (i) statements that reflect perspectives and expectations regarding the lease agreements and campus development, (ii) statements about the HPC industry, (iii) statements of Company plans and objectives, including our evolving business model, or estimates or predictions of actions by suppliers, (iv) statements of future economic performance, and (v) statements of assumptions underlying other statements and statements about the Company or its business. You are cautioned not to rely on these forward-looking statements. These statements are based on current expectations of future events and thus are inherently subject to uncertainty. If underlying assumptions prove inaccurate or known or unknown risks or uncertainties materialize, actual results could vary materially from the Company’s expectations and projections. These risks, uncertainties, and other factors include: our ability to complete construction of the Ellendale HPC data centers; changes to AI and HPC infrastructure needs and their impact on future plans; risks associated with the leasing business, including those associated with counterparties; costs related to the HPC operations and strategy; our ability to timely deliver any services required in connection with completion of installation under the lease agreements; our ability to raise additional capital to fund ongoing and future data center construction and operations; our ability to obtain financing of the lease agreements on acceptable financing terms, or at all; our dependence on principal customers, including our ability to execute and perform our obligations under our leases with key customers, including without limitation, the lease agreements; our ability to timely and successfully build hosting facilities with the appropriate contractual margins and efficiencies; power or other supply disruptions and equipment failures; the inability to comply with regulations, developments and changes in regulations; cash flow and access to capital; availability of financing to continue to grow our business; decline in demand for our products and services; maintenance of third party relationships; and conditions in the debt and equity capital markets. A further list and description of these risks, uncertainties and other factors can be found in the company's most recently filed Annual Report on Form 10-K and Quarterly Report on Form 10-Q, including in the sections captioned “Forward-Looking Statements” and “Risk Factors,” and in the company's subsequent filings with the Securities and Exchange Commission. Copies of these filings are available online at www.sec.gov, on the Company’s website (www.applieddigital.com) under “Investors,” or on request from the Company. Information in this release is as of the dates and time periods indicated herein, and the Company does not undertake to update any of the information contained in these materials, except as required by law.
Media Contacts
Buffy Harakidas and Jo Albers
JSA (Jaymie Scotto & Associates)
jsa_applied@jsa.net
Investor Relations Contacts
Matt Glover or Ralf Esper
Gateway Group, Inc.
(949) 574-3860
APLD@gateway-grp.com
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