Applied Digital APLD is rapidly expanding its AI data center platform, but its growing reliance on a small group of hyperscalers raises concerns about future revenue concentration.

APLD ended fiscal 2026 with approximately $36 billion of contracted lease revenues across 1.4 gigawatts of critical IT load. However, three recently signed 15-year take-or-pay leases with the same high investment-grade hyperscaler account for roughly $20 billion of contracted revenues. Although these campuses span different states, the contracts increase APLD's dependence on a single customer.

The concentration is already visible in reported results. During fiscal 2026, one HPC customer accounted for 59% of total revenues from continuing operations, while no other customer represented more than 10%. APLD expects a limited number of hyperscalers to continue accounting for a high percentage of revenues.

This concentration could become a concern if a major customer experiences financial difficulties, reduces equipment usage or discontinues using APLD facilities. Such developments could pressure lease prices, profit margins, revenues and cash flow.

Still, 15-year take-or-pay agreements and investment-grade counterparties provide meaningful protection, while additional expansion leases with two existing investment-grade customers could reduce customer concentration and support more diversified revenue growth. Supporting this outlook, the Zacks Consensus Estimate projects revenues to increase 49.7% year over year in fiscal 2027.

That is why hyperscaler concentration poses a meaningful revenue risk, but long-term contracts and customer diversification efforts provide important safeguards.

How Do CORZ & CRWV Stack Up Against APLD?

Core Scientific CORZ competes with APLD in power-rich, high-density AI infrastructure, where securing capacity and major counterparties is critical. In the second quarter of 2026, CORZ demonstrated strong execution, reaching 437 billable MW and 1.1 GW of contracted capacity, while its AMD deal adds diversification. However, concentrating large capacity with AMD and CoreWeave creates counterparty risk if either reduces commitments. CORZ appears competitive, with execution and power availability as key strengths.

CoreWeave CRWV contends with APLD through a vertically integrated AI-cloud model spanning GPUs, networking, storage, software and managed inference. CRWV is gaining strong momentum, with second-quarter 2026 revenues rising 112% to $2.6 billion, a $104.2 billion backlog and 1.5 GW of active power. Its expanding customer base helps reduce concentration risk, although exposure to large customers remains a potential weakness. CRWV holds an edge in platform depth and scale but faces higher capital and debt requirements.