Key Stats for Applied Digital Stock
- Price change for Applied Digital stock in last 6 months: -7%
- $APLD Stock Price as of Oct. 8: $24
- 52-Week High: $51
- $APLD Stock Price Target: $65
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What Happened?
Applied Digital (APLD) reported fiscal Q1 results with a big revenue beat and a bigger-than-expected loss.
- Revenue was $341.9 million. That is up 322% from a year ago. Analysts expected only $120 million. Most of the growth came from tenant fit-out work and new rent in its high-performance computing (HPC) hosting business.
- The loss was $0.82 per share, higher than consensus loss estimates of $0.28 per share. Higher costs, interest expense, and fair-value losses drove the miss.
Interest expense rose 866% to $77.4 million and stock-based pay also climbed.
The company booked a $49.5 million derivative loss and an $11.4 million loss on its Babcock & Wilcox investment.
Strip out ChronoScale, and the picture looks better.
Adjusted revenue was $300.4 million. Adjusted operating income was $37.8 million, compared with a loss last year.
The adjusted net loss was just $4.1 million, or 1 cent per share.
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What the Market Is Telling Us About Applied Digital Stock
Applied Digital stock is being judged on growth, not the headline loss.
The core business is scaling fast. HPC hosting made $262.6 million in revenue. Net operating income was $58.8 million, an 89% margin.
The company has 1.41 GW of critical IT load under lease. That backs $36 billion in contracted revenue.
On the call, management said it expects to place over 600 megawatts into service in the next 12 months. That compares with 250 megawatts in the past 12 months.
Funding looks better too. A new $1.59 billion note priced at 7%. An earlier note carried 9.25%. Cash was $3.7 billion, against $6.4 billion of debt.
Management also expects about 250 megawatts of expansion leases by year-end. It says pricing should be materially higher than prior leases.
It also signed a power deal for a 1,200 MW gas plant in North Dakota. It added up to about 1 GW of potential power capacity in Finland.
The risks are clear. Debt is large, and spending is heavy.
Investing activities used $2.08 billion in the quarter. Applied Digital stock will likely trade on how well the company turns contracts into live capacity.
Investors in Applied Digital stock should also watch costs and interest expense. Strong execution could keep Applied Digital stock in focus.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
