Image Credits - benzinga
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Applied Digital, a Texas-based firm specializing in next-generation digital infrastructure for high-performance computing (HPC) applications, has announced a substantial $160 million investment from Nvidia. The investment aims to boost the company’s data center and GPU cloud solutions, enabling Applied Digital to scale its operations and deliver an advanced, hyper-efficient platform tailored for cutting-edge HPC and artificial intelligence (AI) workloads.
The agreement, confirmed earlier this week, signifies Nvidia’s commitment to enhancing data center capabilities and reinforces Applied Digital’s position in the market. The funds will be used to develop and deploy water-cooled data centers optimized for AI and other cloud computing tasks. Applied Digital’s current focus is on creating high-performance, liquid-cooled IT environments that support accelerated computing needs.
In its recent financial report, Applied Digital disclosed a net loss of $64.8 million on revenues of $43.7 million, attributing the loss to pre-operational equipment and facilities expenses. Despite this, the company remains optimistic about the impact of Nvidia’s investment on its future growth and operational capacity.
Applied Digital CEO Wes Cummins conveyed his excitement about the partnership, saying, “We are thrilled about our robust relationship with Nvidia and the trust that Nvidia, Related Companies, and our institutional investors have shown in us. Our team is keen to launch the essential capacity and integrated, liquid-cooled IT environments designed specifically for AI, HPC, and other high-performance computing workloads.”
Under the agreement, Nvidia will purchase 49.4 million shares of Applied Digital at a rate of $3.24 per share, based on the closing price as of September 4. Following the announcement, Applied Digital’s share price surged to $5.59. Nvidia has yet to comment on the investment, but it may come under scrutiny if the U.S. Department of Justice decides to pursue an antitrust investigation into Nvidia’s market practices.
Nvidia previously highlighted its competitive advantages, stating, “Nvidia succeeds based on merit, as demonstrated by our benchmark results and the value we offer to customers. We believe customers should be free to select the solution that best meets their needs.”