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Applied Digital Corp designs, develops and operates next-generation datacenters across North America to provide digital infrastructure solutions to the rapidly growing high-performance computing industry. The company recently entered into a private financing agreement with a single investor where it issued a $42,131,579 unsecured convertible debenture. The debenture bears no interest and has a term of 54 weeks.
Applied Digital (APLD) reported fiscal Q2 2025 results with revenues of $63.9 million, up 51% year-over-year. The company posted a net loss of $138.7 million, impacted by $87.2 million loss on debt fair value changes and $25.4 million loss on debt conversion.
Key developments include a $5.0 billion perpetual preferred equity financing facility with Macquarie Asset Management for its HPC business, with an initial $900 million investment in the Ellendale HPC campus. The company also completed a $450 million offering of 2.75% Convertible Senior Notes.
The Cloud Services segment generated $27.7 million in revenues, up 523% YoY, while Data Center Hosting brought in $36.2 million. The company's Ellendale facility achieved significant milestones, including energizing the main substation transformer.
Applied Digital (APLD) has entered into a transformative $5.0 billion perpetual preferred equity financing facility with Macquarie Asset Management (MAM) for its HPC business. The agreement includes up to $900 million investment in the Ellendale HPC Campus and rights for MAM to invest up to an additional $4.1 billion across future data center projects.
The investment structure gives MAM a perpetual preferred and 15% common equity interest in Applied Digital's HPC business segment, while Applied Digital maintains an 85% ownership stake. The preferred equity will accrue a 12.75% annual dividend. The investment proceeds, combined with future project financing, will support the 400 MW Ellendale HPC Campus build-out, repay $180 million in bridge debt, and allow the company to recover over $300 million of its equity investment.
The closing is contingent upon executing a 100 MW hyperscaler lease at Ellendale. At closing, MAM will fund $225 million, with additional amounts available upon executing further acceptable leases.
Applied Digital (Nasdaq: APLD) has appointed Laura Laltrello as its new Chief Operating Officer, effective January 6, 2025. Laltrello brings nearly 20 years of executive leadership experience, with expertise in data center operations and large-scale infrastructure projects. She previously served as Vice President and General Manager of Building Automation Services at Honeywell International.
In her role as COO, Laltrello will work with the leadership team to execute the company's strategic vision and oversee daily operations. The appointment aims to strengthen Applied Digital's position in next-generation data centers and digital cloud solutions for AI applications.
As part of her employment package, Laltrello received an inducement award of 600,000 restricted stock units (RSUs), which will vest over three years. The award was granted outside the company's equity incentive plan and approved by the Board of Directors on December 27, 2024.
NEWSTAR Exchange has acquired Hadley Crossing, a 44-unit single-family rental community in Charlotte, North Carolina, and launched a new Delaware Statutory Trust (DST) offering for accredited investors. The property features 4-bedroom detached homes with premium amenities and achieved the #3 highest build-to-rent rental rates in Charlotte, with average household incomes exceeding $200,000.
The DST offering, Newstar 14 Hadley Crossing, is financed through Fannie Mae with 43% leverage and aims to raise approximately $14 million in equity. This marks NEWSTAR's fourth DST offering, following successful closures of three previous programs that raised over $50 million in equity. The property reached stabilization in less than 8 months and is being distributed by Preferred Capital Securities under Rule 506(c) of Regulation D.
Applied Digital (Nasdaq: APLD) has scheduled its fiscal second quarter 2025 earnings conference call for Tuesday, January 14, 2025, at 5:00 p.m. Eastern Time. The company will discuss its operations and financial results for the quarter ended November 30, 2024. A press release with detailed results will be issued after market close on the same day. The call will include management's prepared remarks followed by a Q&A session. A replay will be available from 8:00 p.m. ET on January 14 through January 28, 2025.
Applied Digital (Nasdaq: APLD) has achieved a significant milestone in its Ellendale HPC data center development with the successful energization of its on-site main substation transformer. The event was attended by representatives from Applied Digital, Montana-Dakota Utilities (MDU), and local officials including Mayor Don Flaherty.
This advancement enables the company to begin equipment commissioning activities at the purpose-built facility designed for AI and high-performance computing applications. Additionally, Applied Digital has submitted a petition for annexation of its property to the City of Ellendale, which is expected to generate increased revenue streams and expanded municipal services for the community. The project's community impact was recently recognized at the 18th Annual Data Center Dynamics Awards.
Applied Digital (Nasdaq: APLD) has secured a $150 million senior secured debt financing with Macquarie Equipment Capital through its subsidiary APLD Holdings 2, The 18-month Note, issued on November 27th, 2024, features a 0.25% annual interest rate and includes warrants for 1,035,197 shares at $9.66 per share. This refinancing replaces the existing credit facility with CIM Group, removing parent guarantees and cross-collateralization of assets. The Note has a minimum return hurdle starting at 1.11x for the first four months, scaling to 1.35x over its term. The financing will support the company's Ellendale High Performance Computing data center campus development and provides flexibility for future corporate debt structuring.
Applied Digital (APLD) has completed its previously announced offering of 2.75% Convertible Senior Notes due 2030, raising $450 million. The offering includes $75 million in additional notes from exercised options by initial purchasers. The company implemented capped call transactions with a cap price of $14.72 and repurchased approximately $84 million of common stock. Net proceeds were $434.5 million after expenses, with allocations of $84 million for share repurchases, $51.8 million for capped call transactions, and the remainder for general corporate purposes.
Applied Digital (APLD) has announced the pricing of $375 million of 2.75% Convertible Senior Notes due 2030. The notes will be convertible into cash, shares, or a combination thereof at an initial conversion price of $9.75 per share, representing a 32.5% premium to the closing price. The company expects net proceeds of approximately $361.8 million.
The company plans to use $84 million for share repurchases, $43.1 million for capped call transactions, and the remainder for general corporate purposes. The notes will mature on June 1, 2030, with interest payable semi-annually at 2.75%. The company has also entered into capped call transactions with a cap price of $14.72 per share.
Applied Digital (Nasdaq: APLD) announced plans to offer $300 million in convertible senior notes due 2030 through a private offering to qualified institutional buyers. The company may grant initial purchasers an option for an additional $45 million. The notes will be convertible into cash, common stock, or a combination thereof. Applied Digital plans to use proceeds to fund capped call transactions, repurchase common stock up to one-third of the notes' principal amount, and for general corporate purposes. The notes will mature on June 1, 2030, with interest payable semi-annually starting June 1, 2025.