The data-center developer reported $341.9 million of sales and a $221 million GAAP loss. It spent $2.07 billion on construction in the quarter, borrowed $1.65 billion and says it holds about $36 billion of contracted base-term revenue.
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Applied Digital's revenue grew more than fourfold last quarter. What kind of revenue it was matters as much as how much.
For its fiscal first quarter, which ended , the AI data-center developer reported total revenue of $341.9 million, up 322% from $80.9 million a year earlier. Excluding sales of GPU hardware through its ChronoScale unit, adjusted revenue was $300.4 million.
The composition
Services revenue was $262.8 million. Within that, $183.5 million came from tenant fit-out work at its high-performance computing campuses and $23.0 million from ChronoScale GPU hardware. Rental revenue was $79.1 million, of which $65.8 million was base rent.
Fit-out revenue made up about 54% of the total. Base rent, the recurring income a data-center landlord collects over a lease, made up about 19%. Fit-out revenue tends to be tied to construction milestones and can be lumpy, while rent builds as capacity is delivered and leased.
Profit and loss
On a GAAP basis, the company lost $221.0 million from continuing operations, or 76 cents a share. That included a $49.5 million loss on derivatives, an $11.4 million investment loss and $77.4 million of interest expense. The adjusted net loss was $4.1 million, or a penny a share. Adjusted Ebitda rose to $64.4 million from $0.5 million a year earlier.
Quarterly interest expense of $77.4 million exceeded adjusted Ebitda of $64.4 million.
The build-out bill
Capital spending was $2.07 billion in the quarter, about six times revenue. Operating cash flow was a positive $63.9 million. Financing brought in $1.54 billion, including $1.65 billion of new borrowing. Total debt stands at $6.4 billion, and cash including restricted cash at about $3.7 billion.
The backlog
The company says it has leased about 1.41 gigawatts of critical IT capacity across five campuses, representing roughly $36 billion of contracted revenue over the base lease terms and about $86 billion including renewals. That includes a 210-megawatt, 15-year lease at its Delta Forge 2 site worth about $5.2 billion. It aims to deliver 300 megawatts in North Dakota by the end of calendar 2026. The company gave no financial guidance.
Chief Executive Wes Cummins said the goal is to make Applied Digital "the category leader in the design, construction, deployment, and operation of purpose-built AI factories," and argued that "we view every new restriction elsewhere as making what we already own harder to replicate."
The stock
Shares closed down 6.04% at $23.81 on Wednesday before the report and were about 5% higher at $24.99 in thin extended trading early Thursday.
Contracted Growth and Financing Pressure
One reading is that the contracted backlog is what counts. About $36 billion of base-term revenue against a $6.4 billion debt load gives the company visibility few developers have, and adjusted Ebitda is rising quickly as campuses come online.
Another reading is that the quarter's revenue is mostly construction work rather than rent, the company is borrowing heavily at a time of 5%-plus long-term Treasury yields, and interest expense already exceeds adjusted Ebitda.
What turns the backlog into rent
Base rent as a share of revenue is the figure to watch over the next several quarters. Delivery of the 300 megawatts in North Dakota by year-end, and the cost of the company's next financing, will show how quickly contracted revenue becomes cash.