TLDR
- Fiscal Q1 2027 revenue for Applied Digital reaches $341.9 million, representing a 322% increase.
- High-performance computing hosting generates $262.6 million as artificial intelligence infrastructure expands.
- Adjusted EBITDA climbs to $64.4 million compared to $0.5 million in the year-ago period.
- Shares close 6.04% lower at $23.81, then recover 0.96% in extended trading.
- Total debt climbs to $6.4 billion amid aggressive capacity buildout and financing activity.
Applied Digital disclosed first-quarter fiscal 2027 financials showing revenue of $341.9 million, marking a 322% year-over-year gain. The stock finished regular trading at $23.81, declining 6.04%, before climbing 0.96% to $24.04 in after-hours activity. While data center operations expanded substantially, rising expenses and debt-related costs contributed to a wider quarterly loss.
Core Business Lines Deliver Significant Year-Over-Year Gains
Services revenue totaled $262.8 million, a 225% increase from the $80.9 million recorded in the prior-year period. Growth came primarily from tenant fit-out projects, with ChronoScale contributing $23 million through GPU hardware transactions. Data center rental operations and related activities brought in an additional $79.1 million following the launch of hosting services.
Adjusted revenue climbed to $300.4 million versus $64.2 million in the corresponding quarter last year. Adjusted EBITDA expanded significantly to $64.4 million from just $0.5 million twelve months earlier. Net Operating Income hit $58.8 million, demonstrating improved performance in the company’s core hosting operations.
Applied Digital posted a net loss attributable to common shareholders of $221 million. This translated to a loss of $0.76 per diluted share, up from $0.07 in the year-ago quarter. Rising compensation expenses, professional fees, interest obligations, and derivative instrument losses weighed on the bottom line.
High-Performance Computing Segment Powers Growth Strategy
The HPC Hosting division delivered $262.6 million in quarterly revenue. This segment generated $33.4 million in operating income from rental agreements and fit-out service contracts. Live capacity at the Polaris Forge 1 facility now stands at 250 megawatts following the completion of additional phases.
The firm maintains lease arrangements for approximately 1.41 gigawatts of critical IT load distributed across five campus locations. These contracts represent roughly $36 billion in contracted base-term revenue from projects within the United States. Applied Digital anticipates Polaris Forge 2 will push delivered capacity to 300 megawatts before the fiscal year concludes.
International expansion advanced through a one-gigawatt agreement in Finland. Management remains focused on North Dakota execution, where power infrastructure supports large-scale data center development. The company also secured additional power arrangements that could enable further campus expansion throughout the Dakota region.
Balance Sheet Reflects Aggressive Buildout Strategy
Applied Digital reported $3.7 billion in cash and restricted cash at the end of August. Total debt reached $6.4 billion after the company secured capital to fund construction projects. Interest expense surged to $77.4 million from $8 million as outstanding debt balances grew substantially.
Selling, general, and administrative costs jumped 289% to $114.7 million in the quarter. Stock-based compensation accounted for $51.7 million of this total, while spending on personnel and professional services also increased. Services cost of revenue escalated in line with expanded tenant fit-out work across the HPC business segment.
Applied Digital continues developing AI-oriented campuses supported by long-term hyperscaler agreements and substantial power commitments. Revenue expansion demonstrates growing operational scale, though elevated debt levels and reported losses present ongoing financial challenges. The fiscal first-quarter report highlighted accelerating operating momentum alongside increased financing and corporate expenditures.
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