Applied Digital (US:APLD) ZACKS·2025-01-15 15:36Financial Performance - Applied Digital (APLD) reported a second-quarter fiscal 2025 loss of 66 cents per share, missing the Zacks Consensus Estimate of a loss of 14 cents, compared to a loss of 10 cents per share in the same quarter last year [1] - Non-GAAP loss was 6 cents per share, wider than the 5 cents per share reported in the year-ago quarter, after adjusting for various expenses [2] - Revenues reached $63.9 million, a 51% year-over-year increase, aligning with consensus estimates, with Cloud Services revenues surging 523% year over year to $27.7 million [3] Cost and Expenses - Cost of revenues increased by 76% year over year to $52.4 million due to more facilities being energized and additional services provided [7] - Selling, general and administrative expenses rose 46.8% year over year to $29.8 million [7] - Interest expense increased by 186% from the year-ago quarter to $4.9 million [8] Business Operations - APLD's HPC Data Center Hosting business is in late-stage discussions with multiple hyperscalers for a lease agreement for its 100 MW facility in Ellendale, ND, which is currently under construction [5] - The Data Center hosting business is fully operational at its 106 MW facility in Jamestown, ND, and 180 MW facility in Ellendale, ND [6] Market Reaction - Following the fiscal second-quarter results, APLD shares declined by 7%, although they have surged 54.4% over the trailing 12 months, outperforming the Zacks Finance sector's return of 21.1% [4] Balance Sheet and Financing - As of November 30, 2024, APLD had cash, cash equivalents, and restricted cash totaling $314.6 million against debt of $479.6 million [9] - APLD HPC Holdings LLC secured a $5 billion perpetual preferred equity financing deal with Macquarie Asset Management, with up to $900 million allocated for the Ellendale HPC data center campus [9] - The company completed a $450 million offering of 2.75% Convertible Senior Notes due 2030, with net proceeds of approximately $435.2 million [10][11]