Financial Performance - Applied Digital (APLD) reported a third-quarter fiscal 2025 loss of 16 cents per share, which was wider than the Zacks Consensus Estimate of a loss of 11 cents, compared to earnings of 52 cents per share in the same quarter last year [1] - The company generated revenues of $52.9 million for the third quarter, reflecting a 22.1% year-over-year increase, although it missed the Zacks Consensus Estimate by 16.75% [2] - The Cloud Services business revenues increased by 220% year over year to $17.8 million, but saw a sequential decline of 35.7% due to a shift in contract models [3] Business Segments - The Data Center Hosting segment generated $35.2 million in revenues, representing a 7% year-over-year decline [3] - The High-Performance Computing (HPC) Data Center Hosting business is negotiating with multiple U.S.-based hyperscalers to lease up to 400 MW of capacity, including ongoing construction at the Ellendale HPC data center [4] Cost Management - Selling, general and administrative expenses decreased by 24.3% year over year to $22.7 million [6] - Adjusted EBITDA for the quarter was $10 million, a significant improvement from a loss of $1.3 million year over year [6] - Adjusted operating loss narrowed to $8.8 million from a loss of $23.4 million in the previous year [6] Strategic Initiatives - The board of directors approved a plan to divest the Cloud Services Business to focus on core data center operations [7] - APLD secured a $375 million financing arrangement with Sumitomo Mitsui Banking Corporation to repay outstanding debts and fund the development of new data center buildings [8] - The company maintains a strategic partnership with Macquarie Asset Management, which has the right to invest up to $5 billion for the expansion of next-generation data centers [9] Balance Sheet - As of February 28, 2025, APLD had cash, cash equivalents, and restricted cash totaling $261.2 million against a debt of $689.1 million [10]

About this content About Angela Harmantas Angela Harmantas is an Editor at Proactive. She has over 15 years of experience covering the equity markets in North America, with a particular focus on junior resource stocks. Angela has reported from numerous countries around the world, including Canada, the US, Australia, Brazil, Ghana, and South Africa for leading trade publications. Previously, she worked in investor relations and led the foreign direct investment program in Canada for the Swedish government ...

Shares of Applied Digital Corp APLD tanked in early trading after the company reported disappointing earnings for its fiscal third quarter.The company provided visibility into 200 megawatts (MW) coming online in 2026, versus expectations of 100 MW, according to Needham. The Applied Digital Analyst: Analyst John Todaro reiterated a buy and reduced the price target from $11 to $10.The Applied Digital Thesis: The company reported softer-than-expected fiscal third-quarter results due to a technical difficulty w ...

Financial Data and Key Metrics Changes - Revenues for Q3 2025 were $52.9 million, up 22% compared to the prior year [21] - Cost of revenues increased by $2.1 million to $49.1 million from the prior comparable period [23] - Net loss attributable to common stockholders was $36.1 million or $0.16 per share [24] - Adjusted net loss was $17.8 million or $0.08 per diluted share, with adjusted EBITDA increasing 878% to $10 million [25] Business Line Data and Key Metrics Changes - Data center hosting segment generated $35.2 million in revenue, while cloud services segment contributed $17.8 million [21] - Cloud services revenue declined sequentially due to a shift to an on-demand model, but technical issues have been resolved [22] Market Data and Key Metrics Changes - The company operates 286 megawatts of fully contracted data center hosting capacity, running at full capacity [9] - Bitcoin prices remain strong, positively impacting customer sentiment and business prospects [9] Company Strategy and Development Direction - The company is exploring strategic options for its cloud services business, driven by competitive dynamics and potential transition to a data center REIT structure [15][16] - Significant investments have been made, including a $5 billion potential investment from Macquarie Asset Management and a $375 million financing arrangement with Sumitomo Mitsubishi Bank [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the business and its future prospects, particularly in the high-performance computing industry [9] - The company is focused on completing construction on schedule and within budget, with plans for future expansions [28] Other Important Information - The company ended Q3 with $261.2 million in cash and $689.1 million in debt [27] - Construction for the first building is expected to generate revenue in Q4 2025, with subsequent buildings planned for 2026 and 2027 [13] Q&A Session Summary Question: Update on the split between on-demand and contracted cloud services - Currently, four of six clusters are in reserve contracts, while two have moved to on-demand, generating some revenue [33] Question: Long-term fit of the BTC hosting business - BTC assets are expected to align with HPC data center capacity, allowing for dynamic load adjustments [34] Question: Impact of Macquarie and SMBC on leasing momentum - Increased interest has been noted, with improved comfort levels among potential customers due to world-class financing partners [42] Question: Expected capital needs over the next 12 to 18 months - Capital expenditures are in line with past projections, running between $30 to $50 million per month for the first building [44] Question: Status of Bitcoin hosting contracts - Approximately two years remain on existing contracts, with some risk of non-renewal [46] Question: Remaining steps to complete the L&A facility - The facility is expected to be operational by Q4 2025, with remaining expenditures primarily for finishing touches and equipment deployment [51] Question: Plans for selling the cloud business - The process has just started, with various potential structures being evaluated [56] Question: Existing hyperscalers' disposition towards data center builds - Demand remains stable, with ongoing discussions with multiple hyperscalers [64] Question: Pricing trends for data center services - Pricing has been stable over the last 90 days but has increased year-over-year [69] Question: Sale process and potential lessors' requirements - There are no hard requirements for the sale process, but it is seen as the right time to separate the cloud business [83]

Applied Digital Corporation (APLD) came out with a quarterly loss of $0.16 per share versus the Zacks Consensus Estimate of a loss of $0.11. This compares to loss of $0.52 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -45.45%. A quarter ago, it was expected that this company would post a loss of $0.14 per share when it actually produced a loss of $0.66, delivering a surprise of -371.43%.Over the last four quarters, the compa ...

Business Operations - As of February 28, 2025, the Data Center Hosting Business operates at full capacity with a 106 MW facility in Jamestown and a 180 MW facility in Ellendale, North Dakota[170]. - The HPC Hosting Business is constructing a 369,000-square-foot facility in Ellendale, expected to provide ultra-low cost and efficient liquid-cooled infrastructure for HPC applications[173]. - The company is negotiating leases for up to 400 MW capacity with multiple US-based hyperscalers, including the Ellendale HPC Facility under construction[175]. Financial Performance - The Cloud Services Business generated $17.8 million and $71.3 million in revenue during the three and nine months ended February 28, 2025, respectively, accounting for 34% of total revenue for the fiscal quarter[171]. - Total revenue for the three months ended February 28, 2025, was $52.9 million, a 31% increase from $40.3 million for the same period in 2024[221]. - Revenue increased by $64.6 million, or 58%, from $111.0 million for the nine months ended February 29, 2024 to $175.6 million for the nine months ended February 28, 2025[233]. Expenses and Losses - Cost of revenues increased by $2.1 million, or 4%, from $47.1 million to $49.1 million for the same comparative periods[223]. - Selling, general and administrative expenses decreased by $7.3 million, or 24%, from $30.0 million to $22.7 million for the three months ended February 28, 2025[224]. - Net loss attributable to common stockholders for the three months ended February 28, 2025, was $36.1 million, compared to a net loss of $62.8 million for the same period in 2024[219]. Adjusted Metrics - Adjusted EBITDA for the nine months ended February 28, 2025, was $51.4 million, representing 29% of revenues, compared to $19.7 million, or 16% of revenues, for the same period in 2024[220]. - Adjusted operating loss for the three months ended February 28, 2025, was $8.764 million, compared to $23.448 million for the same period in 2024, reflecting a significant improvement[263]. - Adjusted net loss attributable to common stockholders for the nine months ended February 28, 2025, was $51.976 million, compared to $33.301 million for the same period in 2024, indicating an increase in losses[263]. Debt and Financing - The company entered into a promissory note for an initial borrowing of $15 million, with subsequent borrowings of up to $110 million, and an accordion feature allowing for an additional $75 million[178]. - The company completed a private offering of 2.75% Senior Unsecured Convertible Notes due 2030, raising $450 million, with net proceeds of approximately $435.2 million after expenses[186][187]. - As of February 28, 2025, total debt obligations are projected at $871.9 million, with significant payments due in FY 2027 and beyond[286]. Regulatory and Compliance - The company is committed to maintaining compliance with evolving regulatory frameworks affecting HPC, cloud, and blockchain hosting services[167]. - The regulatory landscape for digital assets remains complex, with ongoing discussions in Congress regarding comprehensive legislation to regulate digital assets[166]. Leadership Changes - The company welcomed a new Chief Operating Officer and experienced a transition in its executive team, with significant changes in leadership roles[176][177]. Cash Flow and Liquidity - As of February 28, 2025, the company had unrestricted cash and cash equivalents of $68.7 million and a working capital deficit of $119.3 million[265]. - The company expects to have sufficient liquidity for at least the next 12 months, but may face challenges in raising additional funds[288]. Shareholder Activities - The company increased the number of authorized shares of common stock to 400 million and preferred stock to 10 million[193]. - The company has the option to sell up to $250 million of common stock to YA Fund under the Standby Equity Purchase Agreement[197]. - A private placement of 53,191 shares of Series F Convertible Preferred Stock raised $50 million, with all shares converted into approximately 7.6 million common stock shares by February 28, 2025[277].

Applied Digital Reports Fiscal Third Quarter 2025 Results DALLAS, TX – April 14, 2025 -- Applied Digital Corporation (Nasdaq: APLD) ("Applied Digital" or the "Company"), a designer, builder, and operator of next-generation digital infrastructure designed for high- performance computing ("HPC") applications, cloud services ("Cloud Services"), and data center hosting ("Data Center Hosting"), reported financial results for the fiscal third quarter ended February 28, 2025. The Company also provided an operation ...

DALLAS, April 14, 2025 (GLOBE NEWSWIRE) -- Applied Digital Corporation (Nasdaq: APLD) ("Applied Digital" or the "Company"), a designer, builder, and operator of next-generation digital infrastructure designed for high-performance computing (“HPC”) applications, cloud services (“Cloud Services”), and data center hosting (“Data Center Hosting”), reported financial results for the fiscal third quarter ended February 28, 2025. The Company also provided an operational update. Fiscal Third Quarter 2025 Financial ...

Core Viewpoint - Applied Digital Corporation (APLD) is expected to report strong revenue growth in its third-quarter fiscal 2025 results, driven by its Cloud Services and data center hosting segments, despite facing challenges related to valuation and competition [2][4][19]. Group 1: Financial Performance Expectations - The Zacks Consensus Estimate for APLD's third-quarter fiscal 2025 revenues is $63.57 million, reflecting a year-over-year growth of 46.63% [2]. - The consensus estimate for loss is 11 cents per share, unchanged over the past 30 days, compared to a loss of 52 cents per share in the same quarter last year [2]. - APLD has missed the Zacks Consensus Estimate in three of the last four quarters, with a negative average surprise of 185.39% [3]. Group 2: Business Segments and Growth Drivers - APLD's Cloud Services business is experiencing strong demand, particularly due to the deployment of additional GPU clusters, which is expected to significantly contribute to revenue growth [5]. - The Cloud Services segment generated revenues of $27.7 million in the second quarter of fiscal 2025, marking a 523% year-over-year increase [5]. - The data center hosting segment for cryptocurrency clients remains robust, with revenues of $36.2 million in the second quarter of fiscal 2025, supported by the recent rise in Bitcoin prices [6]. Group 3: Strategic Partnerships and Financial Support - APLD's partnership with Macquarie Asset Management, involving a $5 billion perpetual preferred equity financing facility, is anticipated to provide financial support for future expansion [7][8]. - Investments from CIM Group, NVIDIA, and Macquarie are expected to lower the cost of capital, enhancing APLD's financial flexibility and growth prospects [8]. Group 4: Stock Performance and Valuation - APLD shares have declined by 33.1% year-to-date, underperforming the broader Zacks Finance sector's decline of 16.3% and the Zacks Financial - Miscellaneous Services industry's decrease of 19.4% [9]. - The company's forward 12-month Price/Sales (P/S) ratio is 3.29, which is higher than the industry average of 2.93, indicating a stretched valuation [12]. Group 5: Competitive Landscape and Future Outlook - APLD's expanding data center capacity is viewed positively for its long-term growth prospects, although the company faces stiff competition from major data center providers like Equinix [19]. - The company has established partnerships with key players such as Super Micro Computer, Hewlett Packard Enterprise, and NVIDIA to enhance its operational capabilities [15][16][17].

As artificial intelligence and blockchain technologies continue to reshape the digital economy, investors are eyeing the infrastructure behind these trends. Applied Digital (APLD) and Core Scientific (CORZ) are two emerging players straddling both worlds — offering data center solutions that power AI workloads while maintaining strong ties to crypto mining, particularly Bitcoin.With demand surging for high-performance computing and decentralized infrastructure, both companies are angling for growth in a fas ...