Key Highlights
- Digi Power X (DGXX) shares rallied approximately 39% following the announcement of a Master Services Agreement with Cerebras Systems
- The agreement involves developing a 40 MW AI data center campus located in Columbiana, Alabama
- The initial 10-year agreement carries a valuation of $1.1 billion, potentially reaching $2.5 billion with renewal options
- Development will proceed in two phases, with Phase 1 scheduled for completion by December 15, 2026
- Revenue generation is projected to commence in late 2026, reaching full capacity during Q1 2027
Shares of Digi Power X (DGXX) experienced a significant rally of approximately 39% on Tuesday following the disclosure of a substantial colocation agreement with artificial intelligence chip manufacturer Cerebras Systems.
The partnership centers on constructing a dedicated 40 megawatt AI data center campus in Columbiana, Alabama. Under the initial 10-year arrangement, the contract carries an estimated value of approximately $1.1 billion.
When factoring in potential renewal periods, the total contract value may climb to $2.5 billion. This arrangement provides Digi Power X with substantial long-term revenue predictability beginning from the first day of operational service.
Development will unfold across two distinct phases. Phase 1 encompasses 15 MW of IT capacity, while Phase 2 will contribute an additional 25 MW, culminating in the 40 MW total.
The campus will adhere to Tier III infrastructure standards. These specifications were crafted specifically to accommodate the high-density thermal requirements of advanced AI accelerator hardware — precisely the type of computational workloads that Cerebras deploys.
Phase 1 construction commenced immediately upon signing. Digi Power X is financing Phase 1 development through internal capital, a significant detail given the project’s magnitude.
The company has already finalized the on-site substation for Phase 1. Grid interconnection arrangements are complete, and a power delivery contract with Alabama Power has been executed.
Columbiana was selected due to its robust power infrastructure, favorable regulatory climate, and strategic location near critical fiber optic corridors throughout the southeastern United States. Digi Power X holds full ownership of the real property where the facility will be constructed.
Revenue Timeline
Phase 1 aims for a Ready-for-Service milestone of December 15, 2026. Complete deployment spanning both phases is anticipated by the conclusion of Q1 2027.
Revenue generation from this agreement is forecasted to begin in late 2026. Complete revenue ramp-up is scheduled to align with the finalization of the entire 40 MW deployment.
The Cerebras Side of the Deal
For Cerebras, this agreement secures guaranteed data center infrastructure from day one of operations. This level of capacity assurance proves valuable for an organization expanding frontier AI computational infrastructure.
Cerebras Systems has established a reputation for manufacturing large-scale AI processing chips and computing platforms. The Columbiana campus was engineered “from the ground up” to address specific power density and reliability requirements.
The agreement structure creates mutual advantages. Digi Power X obtains a contracted revenue pipeline. Cerebras secures dedicated, custom-built capacity while avoiding the complexities of independent real estate development.
DGXX maintains a listing on Cboe Canada under the ticker DGX, which experienced approximately 38.93% growth following the announcement.
Shares were trading up roughly 39% as of Tuesday afternoon in response to the partnership disclosure.
