Applied Digital (APLD) Announces Fiscal Third Quarter 2025 Earnings Results

Applied Digital Corporation (APLD) today announced its financial results for the recent quarter, revealing a challenging period for the company. The company reported a quarterly revenue of $52.9 million, falling short of the estimated $64.8 million, marking a miss by approximately $11.9 million. Additionally, the company posted a quarterly loss per share of $0.16, which was below the expected loss of $0.10, resulting in a miss of $0.05667. These results highlight the hurdles APLD faced during the quarter.

Key Highlights:

• Applied Digital reported fiscal third-quarter 2025 revenues of $52.9 million, a 22% increase from the previous year.
• The company experienced a net loss of $36.1 million, up 43% from the prior year.
• The Board of Directors approved a plan to sell the Cloud Services Business.
• A $375 million financing deal was closed with Sumitomo Mitsui Banking Corporation to support the development of the Ellendale HPC Campus.
• Laura Laltrello was appointed as the new Chief Operating Officer.
• The company is focusing on its HPC Data Center Hosting Business, with ongoing construction of a 100 MW facility in Ellendale, North Dakota.
• Applied Digital is negotiating with US-based hyperscalers to lease up to 400 MW of capacity.

Summary:

Applied Digital Corporation reported a significant increase in revenues for the fiscal third quarter of 2025, reaching $52.9 million, which marks a 22% growth compared to the same period last year. Despite this revenue growth, the company faced a net loss of $36.1 million, which is a 43% increase from the previous year. The company is undergoing strategic changes, including the decision by its Board of Directors to sell its Cloud Services Business. This move is part of a broader strategy to focus on its core operations in high-performance computing (HPC) and data center hosting.

The company has made substantial progress in its operational goals, highlighted by a $375 million financing agreement with Sumitomo Mitsui Banking Corporation. This funding will be used to advance the development of the Ellendale HPC Campus, which is a key component of Applied Digital’s growth strategy. The company is also enhancing its leadership team with the appointment of Laura Laltrello as Chief Operating Officer, aiming to strengthen its position in the next-generation data center market. CEO Wes Cummins expressed confidence in the company’s direction, stating, “We are confident in the progress we are making and remain committed to delivering sustainable, long-term value for our investors.” The company is actively negotiating with multiple US-based hyperscalers to lease significant capacity, which underscores its commitment to expanding its data center operations.

Applied Digital Corporation (APLD) has experienced a rollercoaster ride in its stock price over the past year, with a remarkable 72.31% increase over the year, despite a recent downturn. In the past three months alone, the stock has plummeted by 36.19%, and it has seen a 17.02% decline over the past month. This volatility might be attributed to the company’s challenging financial metrics. APLD’s price-to-earnings ratio stands at a concerning -3.07, indicating that the company is currently unprofitable. The net profit margin is also in the red at -1.29, reflecting significant challenges in turning revenue into profit. However, the company has shown an impressive revenue growth rate with a two-year compound annual growth rate (CAGR) of 175.84%, suggesting that while profitability is an issue, revenue generation is not. Despite the negative return on invested capital of -0.54, which raises questions about the efficiency of its investments, the market seems to hold some optimism for APLD’s future, as evidenced by the overall annual price increase.

Applied Digital Corporation designs, develops, and operates digital infrastructure solutions and cloud services high-performance computing (HPC) and artificial intelligence industries in North America. It operates through three segments: Data Center Hosting Business, Cloud Services Business, and HPC Hosting Business. The company offers infrastructure services to crypto mining customers; and GPU computing solutions for critical workloads related to AI, machine learning, and other HPC tasks. It also engages in the designing, constructing, and managing of data centers to support HPC applications. The company was formerly known as Applied Blockchain, Inc. and changed its name to Applied Digital Corporation in November 2022. Applied Digital Corporation is based in Dallas, Texas.