Applied Digital’s revenue more than quadrupled in its fiscal first quarter, but the headline hides a heavy loss. Revenue for the quarter ended August 31, 2026 came to $341.9 million, up 322% on a year earlier. The company posted a net loss attributable to common stockholders of $221.0 million, or $0.76 a share. On an adjusted basis, which strips out its majority-owned ChronoScale cloud unit, the loss was $0.01 a share.
Where the revenue came from
Follow the money and most of it is construction work rather than rent. Services revenue reached $262.8 million against $80.9 million a year earlier, mainly because of about $157.2 million more in tenant fit-out services plus $23.0 million of GPU hardware sales tied to ChronoScale. Data center rental was $79.1 million, from nothing in the prior-year quarter, because the company’s high-performance computing (HPC) hosting arm only began rental operations in the second quarter of fiscal 2026.
The HPC hosting business brought in $262.6 million: $65.8 million of base rent, $183.5 million of fit-out services and $13.3 million of tenant recoveries. It produced $33.4 million of segment operating profit. The older bitcoin-mining hosting business was flat at $37.8 million, against $37.9 million a year before, with its Jamestown and Ellendale, North Dakota, sites running at full capacity. It earned $13.3 million of segment operating profit.
Costs rose with the work. Services cost of revenues jumped 318% to $245.7 million, driven by about $151.1 million of fit-out expense and roughly $22.4 million tied to GPU sales.
Leases, capacity and financing
As of August 31 the company held leases for about 1.41 gigawatts of critical IT load across five campuses: Polaris Forge 1, 2 and 3 in North Dakota, Delta Forge 1 in Louisiana and Delta Forge 2 in Alabama. Those leases represent roughly $36 billion of contracted revenue over their base terms, or about $86 billion if every renewal option is exercised. Polaris Forge 1 is leased to CoreWeave, and the others to investment-grade hyperscalers.
Capacity is arriving in steps. The second 75 MW phase of Building 2 at Polaris Forge 1 became ready for service on October 1, lifting live capacity at the campus to 250 MW. The company expects initial operations at Polaris Forge 2 in Harwood to bring its North Dakota total to 300 MW by the end of 2026. A 210 MW, 15-year lease at Delta Forge 2, announced June 8, carries about $5.2 billion of base-term contracted revenue.
To pay for the third building at Polaris Forge 1, the company closed $1.59 billion of 7.000% senior secured notes due 2031, issued at par, and used part of the proceeds to repay a $300 million bridge facility.
Power and the road abroad
Power is the gating factor, chief executive Wes Cummins argued. Applied Digital signed a power purchase agreement with Base Electron for a roughly 1,200 MW gas-fired plant to be developed in North Dakota, and it holds about 10% of Base Electron. It also secured up to about 1 GW of potential power capacity in Finland, its first step outside the United States. ChronoScale, 96% owned, announced a 50 MW AI deployment with Microsoft using NVIDIA GB300 NVL72 systems.
“As new data center development becomes more difficult in certain markets, we believe the scarcity value of established, powered, and community-supported campuses increases,” Cummins said. The company says its use of spare grid capacity at Polaris Forge 1 has returned more than $45 million in electricity credits to local ratepayers.
