Nvidia (NVDA) is participating with other investors in a $160 million funding round for Applied Digital (APLD), a data center operator and AI cloud computing provider. The investment marks NVDA’s efforts to strengthen its position in the AI market.
As part of this funding, Applied Digital will issue 49,382,720 shares of common stock at $3.24 per share to investors. This fresh capital will fuel APLD’s growth initiatives, including a substantial data center project in North Dakota and the expansion of its cloud computing business.
It is worth mentioning that APLD is already a preferred cloud partner for Nvidia, leveraging NVDA’s powerful AI chips for its data center operations. This investment further deepens the relationship between the two companies.
Nvidia Continues to Ride the AI Boom
Nvidia has been actively investing in AI companies to capitalize on the rapid advancements in this space. The company has participated in funding rounds for other AI startups like CoreWeave, which have seen significant valuation growth.
Importantly, Nvidia’s recent partnership with Tokyo-based Sakana AI is another example of its strategic expansion. The collaboration focuses on AI research, data center development, and building a strong AI community in Japan.
As AI continues to gain momentum across various industries, Nvidia’s investments are likely to drive significant value for the company and its shareholders.
Is Nvidia a Buy, Sell, or Hold?
Despite a 116.5% surge this year, analysts see plenty of upside for the chipmaker, fueled by strong growth prospects in the data center market.
Analysts have a Strong Buy consensus rating on NVDA based on 39 Buys and four Holds assigned in the past three months. The analysts’ average price target on Nvidia stock of $151.79 implies 41.58% upside potential from current levels.
