Applied Digital Corp. Shares Are trading Higher Today: What You Need To Know
Author: Vaishali Prayag | September 05, 2024 11:00am
Shares of Applied Digital Corporation (NASDAQ:APLD) are trading significantly higher Thursday following the announcement of a $160 million private placement financing deal. This strategic move, involving a group of institutional and accredited investors, notably includes NVIDIA Inc. (NASDAQ:NVDA) and Related Companies.
Why Are The Shares Moving?
The sharp increase in Applied Digital's stock price can be attributed to the following key developments:
Private Placement Financing: Applied Digital announced that it has secured $160 million through a private placement of its common stock. This financing was priced at the market value, with the company agreeing to issue approximately 49.38 million shares at a price of $3.24 per share.
Major Investors: The financing round includes significant backing from NVIDIA, a leader in AI chip technology, and Related Companies, a prominent real estate and infrastructure firm. Their investment provides a strong endorsement of Applied Digital's business strategy and growth potential.
AI and Cloud Expansion: The funds will help Applied Digital expand its data-center and cloud-computing operations, specifically in AI-driven infrastructure. The company plans to utilize NVIDIA chips for its AI cloud solutions, which positions it well in the rapidly growing AI and high-performance computing (HPC) sectors.
Key Highlights of the Deal
The private placement deal involves issuing 49.38 million shares at a price of $3.24 per share, raising a total of $160 million.
Applied Digital will use the proceeds to fund data-center expansion and AI cloud infrastructure development, further solidifying its presence in the AI and HPC industries.
The company is working on a major data-center project in North Dakota and expanding its cloud-computing operations.
APLD Price Action: Applied Digital Corporation shares were up by 62.7% at $5.25 according to Benzinga Pro.
