Applied Digital Revenue Doubles to $126.6M in Q3 FY2026 Amid Rapid Expansion

Applied Digital Corporation (NASDAQ: APLD), a designer and operator of data centers for artificial intelligence, cloud, and blockchain workloads, reported revenue of $126.6 million for the three months ending February 28, 2026, up 139% from $52.9 million in the same period a year earlier. For the nine months ending February 28, 2026, revenue reached $352.6 million, doubling the $177.5 million recorded in the prior-year period. Read more earnings reports.

The company posted an operating loss of $85.7 million for the quarter, widening from a $18.9 million loss in the year-ago quarter. For the nine-month period, the operating loss totaled $111.6 million, compared with a $28.1 million loss in the prior-year period. The company reported a net loss of $0.36 per diluted share for the quarter, compared with a $0.16 loss per share a year earlier.

Cost of revenue for the quarter was $72.8 million, up from $49.1 million in the prior year. Selling, general, and administrative expenses surged to $79.7 million from $22.7 million, reflecting expansion costs. For the nine-month period, SG&A expenses reached $166.8 million, up from $66.9 million in the prior-year period.

Balance Sheet Expansion

Total assets ballooned to $6.25 billion as of February 28, 2026, more than tripling from $1.87 billion at the end of fiscal 2025 on May 31, 2025. The expansion was driven by a sharp increase in property, plant, and equipment, which grew to $3.01 billion from $1.25 billion. Cash and cash equivalents surged to $1.73 billion from $44.0 million.

Long-term debt more than tripled to $2.59 billion from $677.8 million over the same period. Total liabilities climbed to $3.68 billion from $1.24 billion. Stockholders' equity rose to $1.58 billion from $497.7 million, reflecting significant capital inflows.

Cash Flow Activity

Cash used in operations for the nine months ending February 28, 2026, was $42.9 million, an improvement from $122.3 million used in the prior-year period. Cash used in investing activities totaled $1.59 billion, up from $465.7 million, primarily due to capital expenditures for data center infrastructure. Cash from financing activities brought in $3.62 billion, compared with $817.5 million in the prior-year period, reflecting debt and equity issuances.

The company had 292.5 million common shares outstanding as of February 28, 2026, up from 234.2 million shares at the end of fiscal 2025. Weighted average diluted shares for the quarter were 282.0 million, compared with 222.5 million in the prior-year quarter.

Financial Summary

Applied Digital operates as a large accelerated filer and is incorporated in Nevada. The company's three reportable segments focus on high-performance data center infrastructure tailored for AI, cloud, and blockchain applications.