Target Hospitality secured a 48 month contract expected to generate more than $750 million in revenue, expanding the workforce housing company’s role in the AI infrastructure buildout.

The agreement covers accommodations and hospitality services for about 3,370 workers supporting AI infrastructure development. Target said the project, which it calls its AI Infrastructure Community, is expected to be completed by mid 2027.

The deal sent Target Hospitality shares higher and added to the company’s broader pivot toward data centers, power generation, and other critical infrastructure projects. Since February 2025, Target has secured more than $2 billion in multi year contract awards, including about $1.8 billion in its Workforce Hospitality Solutions segment.

Target built its business providing modular housing and services for workers in remote industrial locations, including energy projects. The data center boom is creating a similar need, with large AI infrastructure projects requiring thousands of construction, power, and logistics workers in areas that often lack enough housing.

The company expects to invest about $200 million to $210 million to support the AI Infrastructure Community, with roughly 95% of that spending expected in 2026. That makes the contract a major growth opportunity, but also a significant upfront capital commitment.

Target reported first quarter revenue of $72.8 million, up from $69.9 million a year earlier. Its net loss widened to $13 million from $6.5 million, while adjusted EBITDA fell to $9.9 million from $21.6 million, reflecting higher costs tied to new projects and the loss of a higher margin government contract.

The company raised its 2026 outlook to revenue of $370 million to $380 million and adjusted EBITDA of $75 million to $85 million. Capital expenditures are expected to reach $460 million to $480 million as Target funds new communities tied to data center and power related demand.

For investors, the story now depends on execution. Target has built a larger revenue pipeline around AI infrastructure, but much of the payoff depends on completing these projects on time and converting heavy 2026 capital spending into higher revenue and margins in 2027.