Tiger Global Management disclosed a new position in Applied Digital Corporation in its Q4 2024 13F filing, purchasing 107,000 shares valued at approximately $8.4 million at quarter-end prices. The stake represents Chase Coleman's first publicly disclosed entry into the pick-and-shovel layer of AI infrastructure, beneath the hyperscaler tier where the firm already holds Meta and Microsoft.
Applied Digital operates high-performance computing data centers purpose-built for AI training workloads and cryptocurrency mining. The company runs facilities in North Dakota and Texas with combined capacity approaching 180 megawatts, leasing compute to clients who need geographic redundancy outside coastal markets. Revenue in the September quarter reached $60.3 million, up 24% sequentially, driven by expanded hosting agreements with two unnamed hyperscale customers. The company guided Q1 2025 revenue to $66-70 million, implying 18-22% quarter-over-quarter growth if the midpoint holds.
Tiger's entry matters because the firm historically concentrates capital in software and internet platforms, not infrastructure hardware. Coleman ran $65 billion at peak in 2021 before redemptions and losses cut assets to roughly $40 billion by mid-2024. The Applied Digital position is small—likely under 0.03% of total assets—but signals Tiger is expanding its AI thesis beyond application-layer bets. The firm already holds significant stakes in Microsoft and Nvidia through its public book, and this move suggests interest in the middle layer where power, cooling, and rack density create moats that software alone cannot.
Applied Digital's stock moved from $4.80 in early October to $7.85 by year-end 2024, a 63% run that coincided with two contract announcements and tightening supply for AI-optimized colocation space. The company trades at 2.1x forward revenue based on consensus 2025 estimates of $290 million, a discount to pure-play data center REITs like Digital Realty at 6.8x but a premium to commodity hosting providers near 1.2x. Tiger's cost basis likely sits in the $7.50-8.00 range given the quarter-end disclosure window, meaning the position is roughly flat since initiation.
Operators should track Applied Digital's customer concentration and contract renewal terms when the company reports March-quarter results around May 12. Two customers accounted for 68% of revenue in the latest quarter, and both contracts include pricing escalators tied to power costs plus a margin threshold. If either customer delays capacity expansion or renegotiates rates downward, the bull case weakens quickly. Watch also for North Dakota facility utilization, which ran at 87% in September and has limited room for incremental revenue without the Texas expansion coming online in Q2 2025.
Tiger Global now owns a slice of infrastructure whose revenue scales with GPU cluster density, not software seat expansion. The firm's historical edge—spotting consumer internet inflection points eighteen months early—does not transfer cleanly to data center lease economics, where power procurement and depreciation schedules matter more than user growth rates. Coleman's team will need to monitor Applied Digital's ability to secure long-term power purchase agreements at sub-4.5 cents per kilowatt-hour, the threshold where the company maintains a structural advantage over coastal competitors paying 6-8 cents. If natural gas prices in the Bakken region climb above $3.50 per MMBtu and stay there through 2025, the cost advantage narrows and customer retention risk rises. Tiger's position size suggests the firm sees the data center build-out as durable but is not yet convinced Applied Digital has captured enough margin to justify a core holding.