TLDR
- Applied Digital posted Q1 revenue of $64.2 million, crushing analyst estimates of $50 million with an 84% year-over-year jump.
- The company locked in a third CoreWeave lease for 150MW, pushing total contracted revenue to $11 billion over 15-year terms.
- Shares rocketed 27.86% in premarket trading to $37.45 after reporting a $0.03 adjusted loss per share versus expected $0.13-$0.16 loss.
- Applied Digital raised $362.5 million in new capital and broke ground on Polaris Forge 2 with 200MW launching in 2026.
- Year-to-date returns hit 283.38% as the company targets $1 billion in net operating income within five years.
Applied Digital reported fiscal Q1 2026 earnings that blew past Wall Street expectations. Revenue hit $64.2 million versus analyst estimates of $50 million.
The 84% year-over-year revenue increase sent APLD stock up 27.86% to $37.45 in premarket trading Friday. The company also beat on adjusted loss per share at $0.03 compared to expected losses of $0.13 to $0.16.
The Data Center Hosting Business segment pulled in $37.9 million during the quarter ended August 31. Tenant fit-out services and expanded hosting operations fueled the growth.
Cost of revenues climbed 144% to $55.6 million. Roughly $25 million went toward building facilities for high-performance computing clients.
CoreWeave Deal Pushes Total Contracts to $11 Billion
Applied Digital closed a third lease with CoreWeave in August for an additional 150MW in North Dakota. This completes the full 400MW capacity at the Polaris Forge 1 campus.
Total anticipated contracted lease revenue now stands at approximately $11 billion over 15-year terms. The company had previously announced $7 billion from two initial CoreWeave leases earlier this year.
CEO Wes Cummins pointed out that hyperscalers are expected to invest around $350 billion into AI deployment this year. Applied Digital is positioning itself as infrastructure provider for AI computing workloads.
Roth Capital suggested last week the company might land another high-performance computing colocation deal by year-end. The note came before Thursday’s earnings release.
New Campus and Capital Raise Support Expansion Plans
Applied Digital broke ground on Polaris Forge 2 during the quarter. The facility targets AI and high-density workloads with an initial 200MW phase coming online in 2026.
The campus could reach full 1GW buildout by 2027. After quarter-end, the company secured $362.5 million in capital, including $112.5 million from a $5 billion preferred equity facility with Macquarie.
Another $200 million came through Series G preferred stock. Management set a target of $1 billion in net operating income within five years.
Applied Digital now has over $1.6 billion in financed infrastructure across both campuses. Multi-year lease agreements back the expansion.
APLD stock closed Thursday at $29.29, up 4.83%. The stock jumped 14% in after-hours before extending gains in premarket.
Year-to-date returns reached 283.38% versus the S&P 500’s 14.51%. One-year returns stand at 295.81% compared to the broader market’s 16.28%.
Applied Digital carries a market cap of $7.888 billion as of October 2. The 52-week range spans $3.31 to $29.98.
Analyst price targets range from $18.00 to $43.00 with an average of $27.00. The current premarket price exceeds consensus targets.
The stock has a beta of 6.59, showing high volatility. Analyst recommendations remain mostly bullish as AI data center demand continues climbing.
