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Applied Digital (APLD) witnessed a significant surge in its stock price on Friday, climbing 16% following the release of its first-quarter results. The impressive revenue figures were largely driven by the escalating demand for data centers catering to artificial intelligence (AI) applications. This surge contributes to a year-to-date increase of over 350% for the stock, underscoring investor confidence in the company’s strategic positioning within the rapidly expanding AI infrastructure market.
The company’s performance compared favorably to LSEG (London Stock Exchange Group) estimates:
- Loss per share: A loss of 7 cents, outperforming the expected loss of 13 cents.
- Revenue: $64.2 million, exceeding the projected $50 million.
The reported first-quarter revenue of $64.2 million represents a substantial 84% increase compared to the $34.85 million reported in the same period last year.
The impressive revenue gains are closely tied to the increasing need for high-performance computing infrastructure to support AI model training and deployment. As AI becomes further ingrained across various industries, the demand for specialized data centers capable of handling massive computational workloads is projected to continue its upward trajectory.
During the quarter, Applied Digital solidified its position in the AI datacenter space by expanding its existing $7 billion lease agreement with CoreWeave, a specialized provider of cloud infrastructure for compute intensive workloads. This expansion will add 150 megawatts (MW) of capacity at the company’s Polaris Forge 1 campus in North Dakota. The additional capacity brings the anticipated contracted lease revenue for the project up to $11 billion.
“With hyperscalers expected to invest approximately $350 billion into AI deployment this year, we believe we are in a prime position to serve as the modern-day picks and shovels of the intelligence era,” commented CEO Wes Cummins in a press release. Cummins’ remark highlights Applied Digital’s ambition to become a key enabler in the AI revolution by providing the critical infrastructure required to support AI innovation and deployment at scale.
This new facility will join two other data cell blocks, each hosting 100 MW and 150 MW. The company noted that one building is nearly complete and construction will begin on the other.
Further bolstering its strategic infrastructure assets, Applied Digital has secured funding from Macquarie Equipment Capital for a second campus in North Dakota, named Polaris Forge 2. This $3 billion facility will accommodate two 150 MW buildings, bringing the total leased capacity to 600 MW across both campuses. The strategic expansion of both campuses demonstrates Applied Digital’s foresight and strategic capital allocation to capitalize on the increasing demand for AI-related infrastructure and high powered data centers.
The company anticipates an initial 200 MW of power to come online in 2026, reaching full capacity in 2027.
While revenue saw significant gains, Applied Digital reported a net loss of $18.5 million for the first quarter, equivalent to a loss of 7 cents per share. This compares to a net loss of $4.29 million, or 3 cents per share, in the same quarter last year.
Analysts surveyed by LSEG forecast a loss of 15 cents per share for the second quarter on revenue of $76 million.
Applied Digital 5-year stock chart.
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