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Benzinga
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Applied Digital's CoreWeave Deal Just Became An $11 Billion AI Power Play

1. APLD expanded lease with CoreWeave to 400 megawatts, worth $11 billion. 2. The company has 700 megawatts under construction, enhancing growth potential. 3. Construction timelines shortened to 12-14 months, improving operational efficiency. 4. CoreWeave deal aims for stable recurring revenue, boosting future cash flow. 5. APLD targets $1 billion in annual net operating income within five years.

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FAQ

Why Bullish?

The substantial expansion and operational efficiency improvements position APLD favorably, similar to historical gains seen following major capacity expansions by tech firms, like Amazon AWS's facilities, which resulted in strong stock performance due to increased revenue reliability.

How important is it?

The article discusses substantial growth strategies and operational improvements for APLD, making it critical for investors.

Why Long Term?

The expected growth in net operating income and stable leases will have lasting impacts for APLD, reminiscent of trends in established players in the data center space who capitalized on similar expansions over multiple years.

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