Applied Digital (APLD) Q2 2025 earnings summary

Executive summary

• Revenue grew to $63.9 million, up 66% year-over-year, driven by Cloud Services and data center hosting expansion, with new GPU cluster deployments.

• Net loss widened to $138.7 million, mainly due to $87.2 million loss on fair value change of debt and $25.4 million loss on debt conversion.

• Announced a $5 billion perpetual preferred equity financing facility with Macquarie Asset Management, including $900 million for Ellendale and rights to $4.1 billion in future projects.

• Major capital raises included $450 million convertible notes, $150 million senior secured debt, $160 million private placement, and $50 million Series F preferred stock.

• Management transition with new CFO and COO appointments during the quarter.

Financial highlights

• Quarterly revenue: $63.9 million, up from $38.6 million year-over-year; six-month revenue: $124.6 million.

• Adjusted EBITDA increased 93% to $21.4 million (33% margin); adjusted net loss was $12.6 million.

• Net loss attributable to common stockholders was $138.7 million ($0.66 per share), with adjusted net loss per share at $0.06.

• Ended the quarter with $314.6 million in cash and $479.6 million in debt.

• Gross margin was 18% for the quarter, down from 29% year-over-year, due to higher depreciation and lease costs.

Outlook and guidance

• Management expects continued revenue growth from Cloud Services and ramp-up of HPC Hosting, with robust customer demand pipelines.

• Positioned to construct over 2 GW of HPC data center capacity with current equity and Macquarie facility.

• Sufficient liquidity projected for at least 12 months, but future capital needs may arise if expansion outpaces cash generation.

• Expects strong demand for data center capacity through 2026 and 2027, with first power for new campuses available in 2026.

• Ongoing negotiations with hyperscalers for Ellendale leases; $900 million Macquarie investment contingent on lease execution.