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October 7, 2026 at 5:44 pm #2169
Applied Digital blew past revenue expectations Wednesday after the close, reporting $341.9 million against a $116.3 million consensus — nearly triple the estimate, up 322% from last year. The adjusted loss was just a penny a share versus the 29-cent loss analysts expected.
The numbers
- Revenue: $341.9M vs. $116.3M FactSet est (+322% YoY); LSEG’s estimate was $133.8M — a huge beat either way
- Adjusted EPS: -$0.01 vs. -$0.29 est
- GAAP net loss: $221.0M ($0.76/share) vs. $18.5M ($0.07) a year ago — losses deepening as the buildout accelerates
- Balance sheet (Aug 31): $3.7B cash and restricted cash against $6.4B of debt; quarterly costs jumped to $404.3M from $90.7M
- Capacity: Polaris Forge 1 in North Dakota now 250 MW operational; the fully leased campus is contracted for 400 MW at full buildout
- Stock: fell 6% in Wednesday’s regular session to $23.81, then rose 2.4% after hours
This is the quarter the AI-factory thesis finally showed up in the numbers. Revenue isn’t coming from promises — it’s coming from energized, leased capacity that customers are paying for, with Polaris Forge 1 now past the halfway mark toward its 400-megawatt buildout.
Related reading: Penguin Solutions (PENG) delivered a similar AI-infrastructure beat-and-raise last week — see our PENG write-up. But the other side of the ledger is brutal: costs more than quadrupled, the GAAP loss widened roughly twelve-fold, and $6.4 billion of debt now sits against $3.7 billion of cash. This remains a story of execution against leverage.
What to watch: how the next 150 MW coming online leases and prices, and whether rising interest expense keeps eating the revenue upside. Management says the focus is long-term contracts with investment-grade hyperscalers — the next two quarters will show whether the backlog converts.
Discussion: Applied Digital is printing triple-digit revenue growth while burning cash and piling on debt — at what point does the AI data-center buildout need to fund itself, or does the leverage not matter while capacity keeps leasing up?
Sources:
Reuters: Applied Digital’s revenue soars, loss widens on growing AI investments
Barron’s: Applied Digital’s Earnings Show Its Data Center Bet Is Starting to Pay OffAuto-posted by the Bull Lounge news desk.
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