Applied Digital (NASDAQ:APLD) Issues Quarterly Earnings Results, Misses Estimates By $0.02 EPS

Key Points

• Earnings miss but revenue surge: Applied Digital reported Q2 EPS of ($0.11), missing estimates by $0.02, while revenue jumped to $126.6 million (vs. $82.2M est.), up ~250% YoY, though GAAP net loss was $31.2M with negative margins and ROE.
• Major contracted capacity: Polaris Forge One reached ready-for-service 100 MW and, together with a ~400 MW CoreWeave lease and ~200 MW hyperscaler lease, the company now has 600 MW contracted and about $16 billion in prospective lease revenue across its North Dakota campuses, with full build-outs expected by 2027.
• Financing and strategic spinout: Management put in place multi-layered financing (including $900M Macquarie preferred equity and $2.35B senior secured notes), ending the quarter with roughly $2.3B cash vs $2.6B debt, and announced an LOI to spin out the cloud unit as Chronoscale (Applied Digital to own >80%) to separate GPU cloud growth from the data-center business.

Applied Digital (NASDAQ:APLD - Get Free Report) issued its earnings results on Wednesday. The company reported ($0.11) EPS for the quarter, missing analysts' consensus estimates of ($0.09) by ($0.02), Zacks reports. The company had revenue of $126.59 million for the quarter, compared to analysts' expectations of $82.22 million. Applied Digital had a negative return on equity of 37.14% and a negative net margin of 111.29%.The business's revenue was up 250.1% compared to the same quarter last year. During the same period last year, the business posted ($0.06) earnings per share.

Here are the key takeaways from Applied Digital's conference call:

• Polaris Forge One reached ready-for-service energizing 100 MW, and together with a 400 MW CoreWeave lease (~$11B over ~15 years) and a ~200 MW 15-year hyperscaler lease (~$5B), Applied Digital now has 600 megawatts of contracted capacity and approximately $16 billion in prospective lease revenue across its North Dakota campuses, with full build-outs expected by 2027.
• Q2 revenue was $126.6 million (up 250% YoY) driven by $73M of turnkey fit-out services and initial CoreWeave lease recognition; adjusted EBITDA was $20.2M and adjusted net income roughly breakeven, though GAAP net loss was $31.2M and cash receipts for leases (~$8M) differ from straight-line ASC 842 recognition.
• The company has put in place a multi-layered financing framework—$900M drawn from Macquarie preferred equity, a first draw on a $100M Macquarie equipment facility, and a $2.35B senior secured note issuance due 2030—ending the quarter with about $2.3B cash versus $2.6B debt, which funds growth but leaves significant leverage to manage.
• Management announced a spinout LOI to combine Applied Digital Cloud with Exo into Chronoscale (Applied Digital expected to own >80%), aiming to separate GPU-accelerated cloud compute from the data center business to pursue faster cloud growth; the cloud unit has >$60M TTM revenue and $313M in assets.

Applied Digital Stock Performance

Shares of APLD stock opened at $29.56 on Thursday. Applied Digital has a 12-month low of $3.31 and a 12-month high of $40.20. The business's fifty day simple moving average is $27.31 and its 200-day simple moving average is $21.48. The company has a current ratio of 0.65, a quick ratio of 0.65 and a debt-to-equity ratio of 0.29. The company has a market cap of $8.25 billion, a PE ratio of -26.16 and a beta of 6.89.

Analyst Upgrades and Downgrades

Several equities analysts have recently commented on APLD shares. HC Wainwright raised their price target on Applied Digital from $20.00 to $40.00 and gave the company a "buy" rating in a research note on Friday, October 10th. Lake Street Capital restated a "buy" rating and issued a $45.00 price target on shares of Applied Digital in a report on Tuesday, December 30th. Craig Hallum upped their price target on shares of Applied Digital to $39.00 and gave the stock a "buy" rating in a research report on Thursday, October 23rd. Compass Point began coverage on shares of Applied Digital in a research note on Monday, September 15th. They set a "buy" rating on the stock. Finally, Freedom Capital raised shares of Applied Digital to a "strong-buy" rating in a report on Tuesday. Two research analysts have rated the stock with a Strong Buy rating, twelve have issued a Buy rating and one has given a Sell rating to the stock. According to MarketBeat.com, Applied Digital presently has an average rating of "Buy" and a consensus target price of $27.00.

Insider Activity

In related news, Director Richard N. Nottenburg sold 34,375 shares of the company's stock in a transaction dated Friday, October 24th. The stock was sold at an average price of $33.23, for a total transaction of $1,142,281.25. Following the transaction, the director directly owned 263,612 shares of the company's stock, valued at $8,759,826.76. This represents a 11.54% decrease in their position. The sale was disclosed in a filing with the SEC, which is available at this link. Also, Director Rachel H. Lee sold 24,213 shares of the firm's stock in a transaction dated Friday, October 24th. The stock was sold at an average price of $33.20, for a total value of $803,871.60. Following the completion of the sale, the director directly owned 59,400 shares of the company's stock, valued at approximately $1,972,080. This represents a 28.96% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold 328,035 shares of company stock worth $11,376,479 over the last quarter. Company insiders own 9.50% of the company's stock.

Institutional Inflows and Outflows

Several institutional investors have recently modified their holdings of APLD. AQR Capital Management LLC boosted its position in Applied Digital by 84.8% in the 1st quarter. AQR Capital Management LLC now owns 18,945 shares of the company's stock worth $106,000 after purchasing an additional 8,692 shares in the last quarter. NewEdge Advisors LLC lifted its stake in shares of Applied Digital by 239.1% in the 1st quarter. NewEdge Advisors LLC now owns 33,267 shares of the company's stock valued at $187,000 after purchasing an additional 23,457 shares during the period. Geneos Wealth Management Inc. boosted its holdings in Applied Digital by 113.3% during the first quarter. Geneos Wealth Management Inc. now owns 6,667 shares of the company's stock worth $37,000 after buying an additional 3,542 shares in the last quarter. Strs Ohio acquired a new stake in Applied Digital during the first quarter valued at $71,000. Finally, Cetera Investment Advisers increased its holdings in Applied Digital by 61.0% in the second quarter. Cetera Investment Advisers now owns 61,656 shares of the company's stock valued at $621,000 after buying an additional 23,360 shares in the last quarter. 65.67% of the stock is currently owned by hedge funds and other institutional investors.

Applied Digital News Roundup

Here are the key news stories impacting Applied Digital this week:

• Positive Sentiment: Q2 revenue beat estimates and management cited strong demand for large-scale AI data-center capacity, which supports the company’s growth thesis around hyperscaler and AI workloads. Applied Digital beats quarterly revenue estimates on AI data center demand, shares jump
• Positive Sentiment: Company reported record revenue (up ~250% YoY) and provided operational updates (facility builds/Polaris Forge 1 online), pointing to accelerating capacity and revenue scalability. Applied Digital Reports Fiscal Second Quarter 2026 Results
• Positive Sentiment: Multiple firms initiated/upgraded coverage (Freedom Capital Markets, Arete, Zacks), including a “strong-buy” from Zacks and a Freedom Capital coverage start, which can support sentiment and liquidity. Zacks.com
• Neutral Sentiment: Analysts, media and research outlets published deep-dive pieces and the full earnings-call transcript — useful for validating guidance, customer mix and timing for new capacity. APLD Q4 Deep Dive: Data Center Expansion and Strategic Spin-Off Drive Positive Momentum
• Neutral Sentiment: The name has been a trending ticker across outlets (MSN, Benzinga) — higher visibility increases trading volume and volatility but doesn’t change underlying fundamentals. Trending tickers: Intel, Applied Digital...
• Negative Sentiment: EPS slightly missed consensus (reported -$0.11 vs. est. -$0.10) and the company still shows negative margins and ROE, keeping profitability concerns front-and-center for investors. Applied Digital earnings report and transcript
• Negative Sentiment: After a sharp rally into earnings, the stock’s high beta and recent outsized gains make pullbacks and profit-taking likely; today's decline appears to reflect that combination of sentiment and lingering profitability questions. Why Is Applied Digital (APLD) Stock Surging Premarket Today?

Applied Digital Company Profile

Applied Digital NASDAQ: APLD is a technology company specializing in the development and operation of large-scale digital infrastructure and sustainable Bitcoin mining solutions. Through its integrated platform, the company designs, builds and manages turnkey data center facilities while also providing comprehensive hosting services for cloud, colocation and enterprise computing needs. Applied Digital's modular approach to facility design enables rapid deployment of capacity and streamlined integration of power, cooling and network connectivity.

In addition to its data center business, Applied Digital operates a network of Bitcoin mining sites that leverage vertically integrated capabilities, including hardware procurement, mining farm engineering, energy management and real-time performance monitoring.