Applied Digital announced the start of construction for Delta Forge 1, a 430-megawatt AI Factory campus in the southern United States. The project is slated to begin operations in mid-2027 and will house purpose-built infrastructure optimized for large-scale AI workloads. Management expects the facility’s modular design to accelerate build-out timelines by leveraging prefabricated components and multiple onsite concrete plants. This expansion underscores the firm’s commitment to meeting surging demand for AI-specific data center capacity, which industry research forecasts will grow more than threefold between 2025 and 2030.

Following the groundbreaking announcement, Applied Digital’s shares surged by 8.49% on January 23, driving daily trading volume to approximately 47.5 million shares—52% above the three-month average. The rally extends a multiyear gain of over 300% since the company’s 2022 IPO, reflecting growing investor confidence in its niche strategy. Gross margin remains near 16.4%, while the market capitalization stands at $9.7 billion. These metrics highlight the company’s ability to scale infrastructure deployment while maintaining profitability on leased capacity.

Texas Capital recently upgraded its recommendation from Buy to Strong Buy, joining Roth Capital and Needham in maintaining positive outlooks. Investors are eyeing the firm’s long-term lease pipeline, which already includes 600 MW of contracted capacity across two North Dakota campuses. Those leases point to potential revenue of $16 billion over 15 years, with construction costs estimated between $11 million and $13 million per MW. Management targets expanding total capacity to 5 GW over the next five years, supported by land holdings and utility agreements covering 4.3 GW, positioning the company for sustained growth in the under-supplied AI data center market.