Start here if you're new
what it is
Applied Digital builds and runs data centers for AI computing and crypto mining customers across North America.
how it gets paid
Last year Applied Digital made $144M in revenue.
why it's growing
Revenue grew 5.5% last year. $191M matters because it shows demand is real.
what just happened
Revenue hit $191M, but EPS stayed negative at -$0.14, so growth is outrunning profits.
At a glance
B balance sheet — gets the job done, barely
-$0.80 fy2025 eps est
$144M fy2025 rev est
11.7% operating margin
2.85 beta
xvary composite: 47/100 — below average
What they do
Applied Digital builds and runs data centers for AI computing and crypto mining customers across North America.
Its edge is capacity, not software. If you need power-heavy AI infrastructure fast, a built site matters more than a slide deck. The company also just priced $2.35 billion of 9.250% secured notes due 2030, which is debt → borrowed money → enough capital to build, but at a punishing cost.
How they make money
$144M
annual revenue · their business grew +5.5% last year
total revenue
$144M
+5.5%
The products that matter
gpu-ready data center hosting
AI & HPC Hosting
$126.6M · +250% from a year ago
This is the business that matters. It produced $126.6M in Q2 2026 revenue, and the stock's valuation assumes that pace turns into something much larger.
core thesis
managed cloud services
Cloud Services
$18.4M · being separated
This unit generated $18.4M in sales last quarter, but management is spinning it out. You get a cleaner read on the core hosting business — and a narrower company if that core business stumbles.
non-core
Key numbers
$144M
annual revenue
That is the actual sales base today, which matters because the market is valuing the company at about $8 billion.
$8B
market cap
You are paying billions for a company still losing money, so the future has to arrive on schedule.
11.7%
operating margin
Operating margin → profit after running the business → so what: the core operation still loses money.
$2.6B
long-term debt
Debt is already heavy before the new notes, which means growth has to outpace financing costs.
Financial health
B
strength
- balance sheet grade B — adequate — nothing special
- risk rank 3 — safer than 50% of stocks
- price stability 5 / 100
- long-term debt $2.6B (26% of capital)
B — functional but not a standout on the balance sheet.
Total return vs. market
Return history isn't available for APLD right now.
source: institutional data · return history unavailable
What just happened
missed estimates
Revenue hit $191M, but EPS stayed negative at -$0.14, so growth is outrunning profits.
EDGAR shows the latest quarter grew revenue 51% vs. prior year to $191M. The quiet part out loud: VL still shows an operating margin of -11.7%, so more sales are not yet translating into durable earnings.
$191M
revenue
-$0.14
eps
11.7%
operating margin
the number that mattered
$191M matters because it shows demand is real, but a negative -$0.14 EPS says the business still has not turned that demand into shareholder earnings.
source: company earnings report, 2026
Get this snapshot in your inbox
This page, delivered free — plus weekly updates when the numbers change. plain english, no spam.
weekly updates
earnings alerts
plain english
no spam
What could go wrong
The top risk here is backlog conversion. Applied Digital is asking the market to capitalize future leases today. If campuses, power, or customer ramp timing slip, the valuation has very little cushion.
med
The multiple already assumes a better business than the one on paper
Forward price-to-sales is 19.26x versus roughly 4.3x for the sector. That is a premium of about 4.5x while analysts still expect a -$0.80 loss per share this fiscal year.
If revenue conversion slows or margins disappoint, multiple compression does the damage before the long-term story gets a chance to argue back.
med
The reported $16B backlog has to become billable revenue
The bull case rests on lease backlog, campus readiness, and customer demand lining up on schedule. Delays in construction, power availability, or customer ramp timing would hit the thesis where it lives.
Right now, the backlog is far larger than the reported revenue base. That gap creates upside, but it also concentrates risk.
med
This is still a capital-heavy build with $2.6B of long-term debt
Balance sheet grade is B, not A, and long-term debt already sits at 26% of capital. This is enough support to keep building, not enough to make mistakes cheap.
If build-out costs stay heavy while profitability stays negative, financing terms and investor patience both get tighter.
med
Sentiment swings are part of the security
The stock traded between $3 and $42 over the last 52 weeks, with a 2.85 beta and a 5 / 100 price stability score. That is not normal churn. That is a stock pricing the story in real time.
If you own it, even good quarters can come with violent moves. If the story cools, the downside rarely waits for a spreadsheet.
You are paying a premium multiple for a company with an ~$8B market cap, $144M of projected annual revenue, and a business model still being built in public.
source: institutional data · regulatory filings · risk analysis
Pay attention to
backlog conversion
Revenue needs to start chasing the $16B story
Here is the thing: the key question is not whether management can describe demand. It is whether reported revenue starts climbing fast enough to make a 19.26x forward sales multiple feel less theatrical.
next report
Q3 2026 earnings
Watch for another quarter of AI & HPC Hosting growth, plus any update on when leased capacity becomes service-ready and billable.
business mix
Cloud Services separation
Once the spin-out is complete, you get a cleaner view of the core business. That helps analysis, but it removes a buffer if the hosting segment stumbles.
balance sheet
Debt and funding discipline
Long-term debt already stands at $2.6B, with price stability at 5 / 100. In a capital-heavy story, financing risk does not stay in the background for long.
Analyst rankings
earnings surprise
23% / 79%
Revenue beat estimates by 23% and EPS beat by 79%. In human-speak, the latest quarter came in materially better than the street expected.
valuation stance
19.26x
That is the forward sales multiple, versus roughly 4.3x for the sector. Analysts may like the AI setup, but the stock is already charging premium admission.
risk profile
2.85 beta
Beta measures market sensitivity. Here it means APLD tends to move a lot. If you want calm, this is the wrong zip code.
source: institutional data
Institutional activity
institutional ownership data for APLD is being compiled.
source: institutional data
Price targets
3-5 year target range
n/a
n/a
$38
current price
n/a
target midpoint · n/a from current
Want the deeper analysis?
The full deep dive: dcf model, scenario analysis, competitive moat breakdown, and quarterly tracking — everything on this page, taken further.
see plans from $5/moThe deep dive