Applied Digital to Spin Off Cloud Unit, Merge with EKSO for ChronoScale Launch
Applied Digital is set to spin out its cloud computing business in a strategic proposal with EKSO Bionics Holdings, Inc. The plan involves merging Applied Digital Cloud with EKSO to establish ChronoScale Corporation, a platform designed for accelerated computing tailored for high-demand artificial intelligence (AI) workloads.
A Proposed Business Combination
The proposed merger comes as demand for GPU-accelerated cloud infrastructure is increasing rapidly. With this transition, ChronoScale aims to deliver high-performance computing capabilities at scale in a challenging market. This separation allows both businesses to grow independently while focusing on their unique trajectories.
ChronoScale’s Mission
ChronoScale will cater to customers looking for reliable performance and quick deployment without the limitations of standard cloud environments. It will utilize Applied Digital Cloud’s existing resources to deploy advanced GPU infrastructure for AI training and inference.
Upon completion of the merger, Applied Digital is expected to own approximately 97% of ChronoScale. Both Applied Digital Cloud and EKSO will continue their operations post-merger, with EKSO exploring further strategic opportunities.
Leadership Insights
Scott Davis, CEO of EKSO, emphasized the importance of maximizing shareholder value through this transaction. He stated that the proposed combination represents a thoughtful approach to strategic alternatives. Wes Cummins, Chairman and CEO of Applied Digital, noted that ChronoScale will focus on delivering accelerated compute resources tailored for demanding AI applications.
Historical Context and Future Outlook
Applied Digital Cloud was among the first to scale NVIDIA’s H100 GPUs in 2023, showcasing its capability to integrate advanced GPU technology. As of August 31, 2025, it reported annual revenues of around $75.2 million, indicating strong demand for AI infrastructure.
The merger is anticipated to finalize in the first half of 2026, contingent on regulatory approvals and the fulfillment of customary conditions. This move aligns with Applied Digital’s broader strategy to develop purpose-built AI factories, further enhancing infrastructure accessibility for GPU demand.
About the Companies
- Applied Digital: Specializes in designing and operating high-performance data centers for AI, cloud, and blockchain services.
- EKSO Bionics: Develops exoskeleton solutions aimed at enhancing human strength and mobility in medical and industrial settings.
- ChronoScale: To be formed from the merger, focusing on scalable GPU-based infrastructure for AI workloads.
The upcoming merger highlights the growing need for specialized computing capacities to support the evolution of AI tools and technologies. Stakeholders are encouraged to monitor developments as both companies prepare for this significant transition.
