Applied Digital Corp. (APLD), a developer of AI-focused data center campuses backed by long-term hyperscaler contracts and major power commitments, reported fiscal first-quarter 2027 revenue of $341.9 million, a 322% increase year over year, as demand for its data center capacity continued to surge. The stock closed at $23.81, down 6.04%, before gaining 0.96% to $24.04 in after-hours trading. The results underscored rapid data center growth, though higher costs and financing expenses widened the company's loss. The quarter captures both sides of the AI infrastructure build-out: newly commissioned capacity converting quickly into revenue, and the heavy upfront construction and financing costs that come with building it.

Revenue Growth Accelerates Across Core Operations

Services revenue reached $262.8 million, up 225% from $80.9 million one year earlier. Tenant fit-out work drove the increase, while ChronoScale contributed $23 million from GPU hardware sales. Data center rental and other revenue added $79.1 million after hosting operations began, a step from build-out toward active monetization of completed capacity.

Adjusted revenue rose to $300.4 million from $64.2 million in the prior-year quarter. Adjusted EBITDA increased to $64.4 million from $0.5 million in the comparable period, and Net Operating Income reached $58.8 million, reflecting stronger core hosting performance.

Despite the top-line gains, Applied Digital reported a $221 million net loss for common stockholders. The loss equaled $0.76 per diluted share, compared with $0.07 previously. Higher compensation, fees, interest costs, and derivative losses pressured earnings. The divergence between positive adjusted EBITDA and a wider net loss reflects the capital-intensive economics of data center development, in which lease revenue is contracted over multi-year base terms while construction and financing costs are incurred upfront.

HPC Hosting Drives the Expansion

Applied Digital's HPC Hosting business generated $262.6 million in quarterly revenue and produced $33.4 million in operating profit from rent and fit-out services. Live capacity at Polaris Forge 1 reached 250 megawatts after the latest phase entered service.

The company holds leases covering approximately 1.41 gigawatts of critical IT load across five campuses. Those agreements represent about $36 billion in contracted base-term revenue across U.S. projects, giving the company multi-year revenue visibility. Applied Digital expects Polaris Forge 2 to lift delivered capacity to 300 megawatts by year-end, a near-term operational milestone for the build-out.

Expansion has also moved beyond the United States through an agreement covering one gigawatt in Finland, extending the company's footprint internationally. Management continues to center execution on North Dakota, where power availability supports large data center projects, a factor that has become decisive in siting AI-scale campuses. The company has also secured power arrangements that could support further campus growth across the Dakotas.

Debt and Costs Remain Key Financial Factors

Applied Digital ended August with $3.7 billion in cash and restricted cash. Total debt, however, reached $6.4 billion after the company raised capital to fund construction. Interest expense climbed to $77.4 million from $8 million as debt balances increased sharply, reflecting the upfront funding model behind large-scale campus construction.

Selling, general, and administrative expenses rose 289% to $114.7 million during the quarter. Stock-based compensation contributed $51.7 million, while personnel and professional service costs climbed. Services cost of revenue also increased as tenant fit-out activity expanded across the HPC business.

The company continues to build AI-focused campuses supported by long-term hyperscaler contracts and major power commitments. Fiscal first-quarter results showed stronger operating momentum alongside higher financing and corporate costs, with revenue growth strengthening its scale while debt and reported losses remain financial pressures. Near-term markers to follow include Polaris Forge 2 lifting delivered capacity to 300 megawatts by year-end and the path from 250 live megawatts toward the approximately 1.41 gigawatts of leased critical IT load.

Source: Blockonomi