Applied Digital Secures $7.5B Lease with Hyperscaler for 300MW AI Campus

Event summary

  • Applied Digital signed a 15-year, $7.5B lease with a U.S. hyperscaler for Polaris Forge 3, its fourth AI Factory campus, delivering 300MW of critical IT load.
  • Total contracted capacity across four campuses reaches 1.2GW (net) with $31B in lease revenue, $73B if all renewal options are exercised.
  • Polaris Forge 3 spans 600 acres and features proprietary waterless cooling technology for high-density AI workloads, with operations set to begin August 2027.
  • 65% of contracted revenue is backed by U.S. investment-grade hyperscalers, reinforcing Applied Digital's position as a preferred partner for large-scale AI infrastructure.

The big picture

This deal underscores the growing demand for large-scale AI infrastructure and Applied Digital's ability to secure long-term contracts with high-grade hyperscalers. The company's repeatable AI Factory model positions it as a key player in the rapidly evolving high-performance computing sector, though its success hinges on maintaining operational reliability and expanding its customer base beyond a single dominant client.

What we're watching

Customer Concentration
How Applied Digital's reliance on a single hyperscaler customer for multiple campuses may impact revenue stability and operational flexibility.
Execution Risk
The pace at which Applied Digital can deliver on its ambitious construction timeline and meet the hyperscaler's high-density AI workload demands.
Market Positioning
Whether Applied Digital can sustain its lead in the AI data center space as competition intensifies and new players enter the market.