AI Infrastructure Stocks Rally as Selloff Reverses: Applied Digital Jumps 8%, TeraWulf and IREN Rise 6%

AI infrastructure stocks are bouncing back as last week’s selloff in the group starts to unwind. TeraWulf (NASDAQ:WULF) stock is at $12.42, up 6% in morning trading, moving in step with the sector’s other power-backed data center builders.

Meanwhile, Applied Digital (NASDAQ:APLD) stock is at $19.54, up 8%, a bigger gain than TeraWulf shares are posting. IREN Limited (NASDAQ:IREN) shares are up 5% to 28.41, nearly keeping pace with TeraWulf stock.

Financing Fears Give Way to a Rebound

Last week brought a steep selloff across AI infrastructure and neocloud stocks as financing concerns swept through the group. Some buffer comes from TeraWulf’s liquidity, with approximately $3 billion in cash and restricted cash as of June 30.

TeraWulf, Applied Digital and IREN build and lease data center capacity for AI customers, and TeraWulf and IREN are shifting their capacity away from crypto mining. It’s a capital-hungry model: TeraWulf has $1.7 billion in remaining WULF Compute project spending and expects that expansion to be capitalized with 68% debt and 32% equity.

Power access is central to the bullish case for TeraWulf. The Department of Energy projects data centers could account for up to 12% of U.S. electrical demand by 2028, according to a Government Accountability Office report. That demand curve is why the power, cooling, and networking names behind the data centers keep showing up in our free report on seven AI infrastructure suppliers that aren’t chipmakers.

Mining Fund Outpaces the S&P 500

Fund-level buying mirrors the stock moves, with the CoinShares Bitcoin Mining and Digital Power ETF (NASDAQ:WGMI) up 6%. WGMI held TeraWulf, Applied Digital and IREN shares in its June 30 holdings report, with IREN among its larger positions.

Gains elsewhere are far smaller, as the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is up 0.46%. That spread points to buying concentrated in power-backed data center stocks.

From Bitcoin Mining to AI Leases

A shift from Bitcoin (CRYPTO:BTC) toward AI leasing shows up clearly in TeraWulf’s revenue mix. High-performance computing (HPC) leases generated over 70% of the company’s total revenue in Q2 2026, up from zero a year earlier.

TeraWulf’s conversion is furthest along at Lake Mariner in New York, with 102 megawatts of revenue-generating critical IT capacity and 336 megawatts under construction. Staged delivery at the CB-4 building is expected during the second half of 2026, followed by CB-5 in early 2027.

Anthropic holds TeraWulf’s largest contract, a 20-year lease for 401 megawatts at the Justified Data Campus in Kentucky worth $19 billion in contracted revenue over the initial term. Initial delivery is expected in the second half of 2027.

Applied Digital runs a similar leasing model. It uses Polaris Forge campuses in North Dakota and Delta Forge campuses in Louisiana and Alabama, serving hyperscale customers under long-term contracts. Development sites in Texas, Oklahoma, British Columbia, Australia and Spain give IREN a pipeline exceeding 5 gigawatts.

TeraWulf Doubles Power for Its Muskie Campus

TeraWulf doubled the power commitment for its Muskie data center campus in Kentucky earlier this month under an expanded agreement with Kentucky Power. Kentucky Power was slated in TeraWulf’s August plan to build a new 345-kilovolt substation there, with initial electric service in Q4 2028.

Paul Prager spoke on the August 5 earnings call. As TeraWulf’s chairman and CEO at the time, he stated, “Muskie provides the next gigawatt-scale platform in our pipeline, and we are actively advancing commercialization discussions for the site.” Nazar Khan, TeraWulf’s chief technology officer at the time, called those talks “pretty robust.”

A rebound after a steep selloff can fade quickly. TeraWulf’s Justified and Muskie campuses aren’t scheduled to begin delivering capacity until the second half of 2027 or later. Traders may prefer to keep their exposure smaller until TeraWulf’s Muskie tenant search concludes.

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