Why Applied Digital Stock Is Plummeting Today
Applied Digital (NASDAQ: APLD) stock is falling Thursday amid bearish sentiment shaping the broader market. The company's share price was down 8.8% as of 3:40 p.m. ET. At the same point in the day's trading, the S 500 and the Nasdaq Composite index had fallen 4.8% and 5.8%, respectively.
The Trump administration announced yesterday that a universal 10% tariff on all foreign-sourced products will take effect on April 5. Just four days later, a series of extra import taxes will be levied on goods from a select list of countries that the U.S. has large trade deficits with. Investors are selling out of stocks in response, and growth-dependent tech players including Applied Digital are seeing big pullbacks.
Applied Digital is a U.S.-based provider of data-center services, and most of its customers are based within the country. On the other hand, the core hardware that powers the company's cloud-based processing operations relies on components and manufacturing services from overseas companies. As just one example, the Nvidia graphics processing units (GPUs) that are central to Applied Digital's data-center operations rely on chips that are manufactured by Taiwan Semiconductor Manufacturing in Taiwan.
Source Fool.com
