Applied Digital Reports Fiscal First Quarter 2025 Results
Applied Digital (Nasdaq: APLD) reported financial results for the fiscal first quarter ended August 31, 2024. Key highlights include:
- Revenues of $60.7 million, up 67% from the prior year period
- Net loss of $4.2 million, or $0.03 per basic and diluted share
- Adjusted EBITDA of $20.0 million
The company recently secured a $160 million private placement financing from institutional investors, NVIDIA, and Related Companies. Applied Digital is finalizing a lease agreement with a U.S.-based hyperscaler for its 100 MW facility under construction and plans to expand its Ellendale HPC Campus to 400 MW capacity.
The Cloud Services Business segment contributed $25.9 million in revenues. The company's data centers in Jamestown and Ellendale, North Dakota are operating at full capacity.
Applied Digital (Nasdaq: APLD) ha riportato i risultati finanziari per il primo trimestre fiscale conclusosi il 31 agosto 2024. Punti salienti includono:
- Ricavi di 60,7 milioni di dollari, in aumento del 67% rispetto allo stesso periodo dell'anno precedente
- Perdita netta di 4,2 milioni di dollari, ovvero 0,03 dollari per azione base e diluita
- EBITDA rettificato di 20,0 milioni di dollari
L'azienda ha recentemente ottenuto un finanziamento di collocamento privato di 160 milioni di dollari da investitori istituzionali, NVIDIA e Related Companies. Applied Digital sta finalizzando un contratto di locazione con un hyperscaler con sede negli Stati Uniti per la sua struttura da 100 MW attualmente in costruzione e prevede di espandere il suo Campus HPC di Ellendale a una capacità di 400 MW.
Il segmento dei Servizi Cloud ha contribuito con 25,9 milioni di dollari in ricavi. I centri dati dell'azienda a Jamestown ed Ellendale, nel Dakota del Nord, operano a piena capacità.
Applied Digital (Nasdaq: APLD) reportó resultados financieros para el primer trimestre fiscal que finalizó el 31 de agosto de 2024. Aspectos destacados incluyen:
- Ingresos de 60.7 millones de dólares, un aumento del 67% respecto al período del año anterior
- Pérdida neta de 4.2 millones de dólares, o 0.03 dólares por acción básica y diluida
- EBITDA ajustado de 20.0 millones de dólares
La compañía aseguró recientemente un financiamiento de colocación privada de 160 millones de dólares de inversores institucionales, NVIDIA y Related Companies. Applied Digital está finalizando un contrato de arrendamiento con un hyperscaler con sede en EE. UU. para su instalación de 100 MW en construcción y planea expandir su Campus HPC de Ellendale a una capacidad de 400 MW.
El segmento de Servicios en la Nube contribuyó con 25.9 millones de dólares en ingresos. Los centros de datos de la compañía en Jamestown y Ellendale, Dakota del Norte, están operando a plena capacidad.
Applied Digital (Nasdaq: APLD)는 2024년 8월 31일자로 종료된 회계 첫 분기 재무 결과를 보고했습니다. 주요 하이라이트는 다음과 같습니다:
- 매출 6070만 달러, 지난해 동기 대비 67% 증가
- 순손실 420만 달러, 기본 및 희석 주당 0.03 달러
- 조정 EBITDA 2000만 달러
회사에선 최근에 기관 투자자, NVIDIA 및 Related Companies로부터 1억 6000만 달러의 사모 투자 유치를 확보했습니다. Applied Digital은 현재 건설 중인 100MW 시설을 위해 미국에 본사를 둔 하이퍼스케일러와 임대 계약을 최종화하고 있으며, Ellendale HPC 캠퍼스를 400MW 용량으로 확장할 계획입니다.
클라우드 서비스 비즈니스 부문은 2590만 달러의 수익을 기여했습니다. Jamestown 및 Ellendale, 노스다코타에 위치한 회사의 데이터 센터는 최대 용량으로 운영되고 있습니다.
Applied Digital (Nasdaq: APLD) a publié des résultats financiers pour le premier trimestre fiscal s'étant terminé le 31 août 2024. Les points clés incluent :
- Revenus de 60,7 millions de dollars, en augmentation de 67 % par rapport à la période de l'année précédente
- Perte nette de 4,2 millions de dollars, soit 0,03 dollar par action de base et diluée
- EBITDA ajusté de 20,0 millions de dollars
L'entreprise a récemment sécurisé un financement en placement privé de 160 millions de dollars provenant d'investisseurs institutionnels, de NVIDIA et de Related Companies. Applied Digital finalise un contrat de location avec un hyperscaler basé aux États-Unis pour son installation de 100 MW en construction et prévoit d'étendre son Campus HPC d'Ellendale à une capacité de 400 MW.
Le segment des Services Cloud a contribué à hauteur de 25,9 millions de dollars en revenus. Les centres de données de l'entreprise situés à Jamestown et Ellendale, dans le Dakota du Nord, fonctionnent à pleine capacité.
Applied Digital (Nasdaq: APLD) hat die finanziellen Ergebnisse für das im August 31, 2024 endende erste Quartal des Geschäftsjahres veröffentlicht. Wichtige Höhepunkte umfassen:
- Einnahmen von 60,7 Millionen US-Dollar, ein Anstieg von 67 % im Vergleich zum Vorjahreszeitraum
- Nettoverlust von 4,2 Millionen US-Dollar, oder 0,03 US-Dollar pro Basis- und verwässerter Aktie
- Bereinigtes EBITDA von 20,0 Millionen US-Dollar
Das Unternehmen hat kürzlich eine Privatplatzierungsfinanzierung in Höhe von 160 Millionen US-Dollar von institutionellen Investoren, NVIDIA und Related Companies gesichert. Applied Digital finalisiert derzeit einen Mietvertrag mit einem in den USA ansässigen Hyperscaler für seine 100-MW-Anlage, die sich im Bau befindet, und plant, den Ellendale HPC Campus auf eine Kapazität von 400 MW zu erweitern.
Das Geschäftssegment Cloud-Dienste trug mit 25,9 Millionen US-Dollar zu den Einnahmen bei. Die Rechenzentren des Unternehmens in Jamestown und Ellendale, North Dakota, arbeiten mit voller Kapazität.
- Revenue increased 67% year-over-year to $60.7 million
- Secured $160 million private placement financing from strategic investors
- Cloud Services Business segment contributed $25.9 million in revenues
- Finalizing lease agreement with U.S.-based hyperscaler for 100 MW facility
- Plans to expand Ellendale HPC Campus to 400 MW capacity
- Data centers in Jamestown and Ellendale operating at full capacity
- Net loss of $4.2 million, or $0.03 per share
- Adjusted net loss of $21.6 million, or $0.15 per diluted share
- Cost of revenues increased to $61.1 million from $25.2 million in the prior year
- Debt increased to $143.6 million from $125.4 million at the end of fiscal 2024
Insights
Applied Digital's Q1 FY2025 results show significant revenue growth of
Key developments include:
- Securing a
$160 million private placement financing, enhancing the company's financial position - Expansion of Cloud Services business, contributing
$25.9 million in revenue - Progress on HPC data center projects, including a potential lease agreement with a U.S.-based hyperscaler
- Plans to increase total HPC capacity to 400 MW at the Ellendale campus
These initiatives position Applied Digital for potential growth in the high-performance computing and AI infrastructure markets. However, investors should monitor the company's ability to manage expenses and achieve profitability as it scales operations.
Applied Digital's strategic focus on high-performance computing (HPC) and AI infrastructure is timely, given the surging demand for these technologies. The company's expansion of GPU clusters for cloud services and the development of specialized HPC data centers demonstrate a forward-thinking approach to capitalize on the AI boom.
Key technological aspects to note:
- Increase to six GPU clusters, each with 1,024 GPUs, indicating substantial compute power
- Development of liquid-cooled infrastructure for HPC applications, which is important for efficiency and performance
- Planned 400 MW total capacity at Ellendale, showcasing scalability
The partnership with NVIDIA through the private placement is particularly significant, as it validates Applied Digital's technology strategy and potentially provides access to cutting-edge GPU technology. The company's focus on energy-efficient, high-density computing aligns well with the industry trend towards sustainable and powerful AI infrastructure. However, the rapid pace of technological change in AI hardware presents both opportunities and risks for Applied Digital's long-term competitiveness.
DALLAS, Oct. 09, 2024 (GLOBE NEWSWIRE) -- Applied Digital Corporation (Nasdaq: APLD) ("Applied Digital" or the "Company"), a designer, builder, and operator of next-generation digital infrastructure designed for high-performance computing (“HPC”) applications, cloud services (“Cloud Services”), and data center hosting (“Data Center Hosting”), reported financial results for the fiscal first quarter ended August 31, 2024. The Company also provided an operational update.
Fiscal First Quarter 2025 Financial Highlights
- Revenues of
$60.7 million , up67% from the prior year period - Net loss of
$4.2 million - Net loss per basic and diluted share of
$0.03 - Adjusted net loss of
$21.6 million , which was negatively impacted by$4.4 million of expenses associated with facilities and equipment that were not yet generating revenue - Adjusted EBITDA of
$20.0 million - Adjusted net loss per diluted share of
$0.15
Adjusted EBITDA, Adjusted Operating Loss, Adjusted Net Loss, and Adjusted Net Loss per Diluted Share are non-GAAP measures. A reconciliation of each of these Non-GAAP Measures to the most directly comparable financial measure presented in accordance with accounting principles generally accepted in the United States (“GAAP”) is set forth below. See “Reconciliation of GAAP to Non-GAAP Measures.”
Recent Operational Highlights
- The Company announced on September 5, 2024 that it has entered into definitive agreements for a
$160 million private placement financing priced at market, from a group of institutional and accredited investors, NVIDIA and Related Companies, the most prominent privately-owned real estate company and leader in complex infrastructure and data center development. This strategic financing underscores Applied Digital's position as a trusted pioneer in the accelerated compute space. The transaction closed on September 9, 2024. - The Company added two additional clusters to our Cloud Services Business, increasing the total to six clusters, each containing 1,024 GPUs.
Management Commentary
Wes Cummins, Chairman and CEO of Applied Digital commented: “After the close of the quarter, our balance sheet significantly improved due to strategic investments from a group of institutional and accredited investors, NVIDIA, and Related Companies. We sincerely appreciate the vote of confidence from our investors and look forward to deploying this capital into high-return projects in the digital infrastructure sector.
We have made significant strides in our key growth initiatives. We are finalizing a lease agreement with a U.S.-based hyperscaler for our 100 MW facility currently under construction. This state-of-the-art, 369,000+ square-foot facility is specifically designed for HPC applications, including artificial intelligence. Furthermore, we are in the design phase for two additional buildings at this location, which will increase the total capacity to 400 MW.
Our vision is to become a platform capable of building and operating multiple HPC data centers. This starts with our Ellendale campus and continues with three additional campuses we are actively marketing totaling 1.4 GW. To support this vision, we have added several industry veterans to our team and are already working on the design of our next two buildings, which will provide an additional 300 MW of capacity at our Ellendale HPC Campus. We are incredibly proud of the progress made this quarter and look forward to providing further updates as the year progresses.
Lastly, we are delighted to announce some executive changes to better position the Company for managing its rapidly expanding growth. David Rench will assume the role of Chief Administrative Officer and Saidal Mohmand will assume the role of Chief Financial Officer, with these changes to be effective Monday, October 14th.”
Cloud Services Update
Applied Digital’s Cloud Services Business provides high-performance computing power for artificial intelligence and machine learning applications. During the three months ended August 31, 2024, we brought two clusters online contributing to the Company recognizing
HPC Data Center Hosting Update
Applied Digital’s HPC Data Center Hosting Business designs, builds, and operates next-generation data centers, which are designed to provide massive computing power and support high-performance computing applications within a cost-effective model. During the prior fiscal year, the Company broke ground on its first 100 MW HPC facility in Ellendale, North Dakota. The new 369,000+ square-foot building will provide ultra-low-cost and highly efficient liquid-cooled infrastructure for HPC applications.
We are finalizing a lease agreement with a U.S.-based hyperscaler for our 100 MW facility currently under construction. Beyond this, we plan to bring an additional 300 MW online through two additional buildings, which are in the design stage, ultimately increasing Ellendale's total HPC capacity to 400 MW. We are also in advanced negotiations with traditional financing institutions to secure funding for these projects.
Data Center Hosting Update
Our Data Center Hosting Business operates data centers to provide energized space to crypto mining customers. As of August 31, 2024, our 106 MW facility in Jamestown, North Dakota and our 180 MW facility in Ellendale, North Dakota are operating at full capacity.
The sale of our Garden City, Texas hosting facility to Marathon was finalized in April 2024. On July 30, 2024 the conditional approval requirements related to the release of the escrowed funds from the sale were met, resulting in the release of the escrow funds to the Company totaling
Financial Results for Fiscal First Quarter 2025
Operating Results
Total revenues in the fiscal first quarter 2025 were
Cost of revenues in the fiscal first quarter 2025 was
Selling, general and administrative expenses in the fiscal first quarter 2025 were
Net loss for the fiscal first quarter 2025 was
Adjusted net loss, a non-GAAP measure, for the fiscal first quarter of 2025, was
Adjusted EBITDA, a non-GAAP financial measure, for the fiscal first quarter 2025 was
Balance Sheet
We ended the fiscal first quarter 2025 with
Conference Call
Applied Digital will host a conference call today, October 9, 2024, at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) to discuss these results. A question-and-answer session will follow the management’s presentation.
U.S. dial-in number: 1-877-407-0792 International number: 1-201-689-8263 Conference ID: 13749090
The conference call will be broadcast live and will be available for replay here.
Please call the conference telephone number approximately 10 minutes before the start time. An operator will register your name and organization. If you have difficulty connecting with the conference call, please contact Applied Digital’s investor relations team at 1-949-574-3860.
A replay of the call will be available after 8:00 p.m. Eastern Time on October 9, 2024 through October 23, 2024.
Toll-free replay number: 1-844-512-2921 International replay number: 1-412-317-6671 Conference ID: 13749090
Applied Digital Corporation (Nasdaq: APLD) designs, develops, and operates next-generation digital infrastructure across North America to provide digital infrastructure solutions and cloud services to the rapidly growing industries of High-Performance Computing ("HPC") and Artificial Intelligence ("AI"). Find more information at www.applieddigital.com. Follow us on X (formerly Twitter) at @APLDdigital.
Forward-Looking Statements
This release contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 regarding, among other things, future operating and financial performance, product development, market position, business strategy and objectives. These statements use words, and variations of words, such as "continue," "build," "future," "increase," "drive," "believe," "look," "ahead," "confident," "deliver," "outlook," "expect," and "predict." Other examples of forward-looking statements may include, but are not limited to, (i) statements of Company plans and objectives, including our evolving business model, or estimates or predictions of actions by suppliers, (ii) statements of future economic performance, and (iii) statements of assumptions underlying other statements and statements about the Company or its business. You are cautioned not to rely on these forward-looking statements. These statements are based on current expectations of future events and thus are inherently subject to uncertainty. If underlying assumptions prove inaccurate or known or unknown risks or uncertainties materialize, actual results could vary materially from the Company's expectations and projections. These risks, uncertainties, and other factors include: decline in demand for our products and services; the volatility of the crypto asset industry; the inability to comply with developments and changes in regulation; cash flow and access to capital; and maintenance of third party relationships. Information in this release is as of the dates and time periods indicated herein, and the Company does not undertake to update any of the information contained in these materials, except as required by law.
Use and Reconciliation of Non-GAAP Financial Measures
To supplement our consolidated financial statements presented under GAAP, we are presenting certain non-GAAP financial measures. We are providing these non-GAAP financial measures to disclose additional information to facilitate the comparison of past and present operations by providing perspective on results absent one-time or significant non-cash items. We utilize these measures in the business planning process to understand expected operating performance and to evaluate results against those expectations. We believe that these non-GAAP financial measures, when considered together with our GAAP financial results, provide management and investors with an additional understanding of our business operating results regarding factors and trends affecting our business and provide a reasonable basis for comparing our ongoing results of operations.
These non-GAAP financial measures are provided as supplemental measures to the Company’s performance measures calculated in accordance with GAAP and therefore, are not intended to be considered in isolation or as a substitute for comparable GAAP measures. Further, these non-GAAP financial measures have no standardized meaning prescribed by GAAP and are not prepared under any comprehensive set of accounting rules or principles. Because of the non-standardized definitions of non-GAAP financial measures, we caution investors that the non-GAAP financial measures as used by us in this Quarterly Report on Form 10-Q have limits in their usefulness to investors and may be calculated differently from, and therefore may not be directly comparable to, similarly titled measures used by other companies. Further, investors should be aware that when evaluating these non-GAAP financial measures, these measures should not be construed as an inference that the Company’s future results will be unaffected by unusual or non-recurring items. In addition, from time to time in the future there may be items that we may exclude for purposes of our non-GAAP financial measures and we may in the future cease to exclude items that we have historically excluded for purposes of our non-GAAP financial measures. Likewise, we may determine to modify the nature of the adjustments to arrive at our non-GAAP financial measures. Investors should review the non-GAAP reconciliations provided below and not rely on any single financial measure to evaluate the Company’s business.
Change in Presentation
Beginning in the third quarter of 2024, the Company updated its presentation of non-GAAP measures. As a result of this updated presentation, the Company no longer excludes start-up costs as an adjustment to Operating loss, Net loss, or EBITDA in our calculation of Adjusted operating loss, Adjusted net loss attributable to Applied Digital Corporation, Adjusted net loss attributable to Applied Digital Corporation per diluted share, and Adjusted EBITDA. EBITDA, Adjusted EBITDA, Adjusted net loss attributable to Applied Digital Corporation, and Adjusted net loss attributable to Applied Digital Corporation per diluted share are non-GAAP measures and are defined below.
Adjusted Operating Loss, Adjusted Net Loss, and Adjusted Net Loss per Diluted Share
“Adjusted Operating Loss” and “Adjusted Net Loss” are non-GAAP financial measures that represent operating loss and net loss, respectively, excluding stock-based compensation, non-recurring repair expenses, diligence, acquisition, disposition and integration expenses, litigation expenses, non-recurring research and development expenses, gain on classification of held for sale, accelerated depreciation and amortization, loss on legal settlement, as well as other non-recurring expenses that Management believes are not representative of the Company’s expected ongoing costs. Adjusted Net Loss is Adjusted Operating Loss further adjusted for the losses associated with the abandonment of assets, changes in fair value of debt and loss on extinguishment of debt. We define “Adjusted Net Loss per Diluted Share” as Adjusted Net Loss divided by weighted average diluted share count.
EBITDA and Adjusted EBITDA
“EBITDA” is defined as earnings before interest, taxes, and depreciation and amortization. “Adjusted EBITDA” is defined as EBITDA adjusted for stock-based compensation, non-recurring repair expenses, diligence, acquisition, disposition and integration expenses, litigation expenses, non-recurring research and development expenses, (gain)/loss on classification of held for sale, the losses associated with the abandonment of assets, changes in fair value of debt, debt extinguishment, as well as the loss on legal settlement and other non-recurring expenses that Management believes are not representative of the Company’s expected ongoing costs.
Investor Relations Contacts
Matt Glover or Ralf Esper
Gateway Group, Inc.
(949) 574-3860
APLD@gateway-grp.com
Media Contact
Buffy Harakidas, EVP
JSA (Jaymie Scotto & Associates)
(856) 264-7827
jsa_applied@jsa.net
| APPLIED DIGITAL CORPORATION AND SUBSIDIARIES Condensed Consolidated Balance Sheets (Unaudited) (In thousands, except share and par value data) | |||||||
| August 31, 2024 | May 31, 2024 | ||||||
| ASSETS | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 58,215 | $ | 3,339 | |||
| Restricted cash | 21,342 | 21,349 | |||||
| Accounts receivable | 2,298 | 3,847 | |||||
| Prepaid expenses and other current assets | 2,063 | 1,343 | |||||
| Current assets held for sale | 192 | 384 | |||||
| Total current assets | 84,110 | 30,262 | |||||
| Property and equipment, net | 478,249 | 340,381 | |||||
| Operating lease right of use assets, net | 147,148 | 153,611 | |||||
| Finance lease right of use assets, net | 200,649 | 218,683 | |||||
| Other assets | 27,576 | 19,930 | |||||
| TOTAL ASSETS | $ | 937,732 | 762,867 | ||||
| LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS' EQUITY | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 140,264 | $ | 116,117 | |||
| Accrued liabilities | 26,723 | 26,282 | |||||
| Current portion of operating lease liability | 22,393 | 21,705 | |||||
| Current portion of finance lease liability | 112,079 | 107,683 | |||||
| Current portion of debt | 6,892 | 10,082 | |||||
| Current portion of debt, at fair value | 30,464 | 35,836 | |||||
| Customer deposits | 13,676 | 13,819 | |||||
| Related party customer deposits | — | 1,549 | |||||
| Deferred revenue | 16,867 | 37,674 | |||||
| Related party deferred revenue | — | 1,692 | |||||
| Due to customer | 17,211 | 13,002 | |||||
| Other current liabilities | 96 | 96 | |||||
| Total current liabilities | 386,665 | 385,537 | |||||
| Long-term portion of operating lease liability | 103,871 | 109,740 | |||||
| Long-term portion of finance lease liability | 43,841 | 63,288 | |||||
| Long-term debt | 106,227 | 79,472 | |||||
| Total liabilities | 640,604 | 638,037 | |||||
| Commitments and contingencies (Note 10) | |||||||
| Temporary equity | |||||||
| Series E preferred stock, | 6,932 | — | |||||
| Series F preferred stock, 0.001 par value, 53,191 shares authorized, issued and outstanding at August 31, 2024, and no shares authorized, issued or outstanding at May 31, 2024 | 48,350 | — | |||||
| Stockholders' equity: | |||||||
| Common stock, | 162 | 144 | |||||
| Treasury stock, 5,032,802 shares at August 31, 2024 and 5,032,802 shares at May 31, 2024, at cost | (62 | ) | (62 | ) | |||
| Additional paid in capital | 496,027 | 374,738 | |||||
| Accumulated deficit | (254,281 | ) | (249,990 | ) | |||
| Total stockholders’ equity attributable to Applied Digital Corporation | 241,846 | 124,830 | |||||
| TOTAL LIABILITIES, TEMPORARY EQUITY AND SHAREHOLDERS' EQUITY | $ | 937,732 | 762,867 | ||||
| APPLIED DIGITAL CORPORATION AND SUBSIDIARIES Condensed Consolidated Statements of Operations (Unaudited) (In thousands, except per share data) | |||||||
| Three Months Ended | |||||||
| August 31, 2024 | August 31, 2023 | ||||||
| Revenue: | |||||||
| Revenue | $ | 58,778 | $ | 32,139 | |||
| Related party revenue | 1,926 | 4,184 | |||||
| Total revenue | 60,704 | 36,323 | |||||
| Costs and expenses: | |||||||
| Cost of revenues | 61,060 | 25,221 | |||||
| Selling, general and administrative (1) | 14,341 | 16,170 | |||||
| Gain on classification of held for sale (2) | (24,808 | ) | — | ||||
| Loss on abandonment of assets | 628 | — | |||||
| Loss from legal settlement | — | 2,300 | |||||
| Total costs and expenses | 51,221 | 43,691 | |||||
| Operating income (loss) | 9,483 | (7,368 | ) | ||||
| Interest expense, net (3) | 7,308 | 2,133 | |||||
| Loss on change in fair value of debt | 6,422 | — | |||||
| Loss on extinguishment of related party debt | — | 2,353 | |||||
| Net loss before income tax expenses | (4,247 | ) | (11,854 | ) | |||
| Income tax expense (benefit) | — | — | |||||
| Net loss | (4,247 | ) | (11,854 | ) | |||
| Net loss attributable to noncontrolling interest | — | (397 | ) | ||||
| Preferred dividends | (44 | ) | — | ||||
| Net loss attributable to Common Stockholders | $ | (4,291 | ) | $ | (11,457 | ) | |
| Basic and diluted net loss per share attributable to Applied Digital Corporation | $ | (0.03 | ) | $ | (0.11 | ) | |
| Basic and diluted weighted average number of shares outstanding | 149,009,336 | 100,521,673 | |||||
(1) Includes related party selling, general and administrative expense of
(2) Includes
(3) Includes related party interest expense of
| APPLIED DIGITAL CORPORATION AND SUBSIDIARIES Condensed Consolidated Statements of Cash Flows (In thousands) (Unaudited) | |||||||
| Three Months Ended | |||||||
| August 31, 2024 | August 31, 2023 | ||||||
| CASH FLOW FROM OPERATING ACTIVITIES | |||||||
| Net loss | $ | (4,247 | ) | $ | (11,854 | ) | |
| Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||||||
| Depreciation and amortization | 34,316 | 7,860 | |||||
| Stock-based compensation | (2,919 | ) | 5,641 | ||||
| Lease expense | 7,659 | — | |||||
| Loss on extinguishment of debt | — | 2,353 | |||||
| Loss on legal settlement | — | 2,300 | |||||
| Amortization of debt issuance costs | 2,769 | 235 | |||||
| Gain on classification of held for sale | (24,808 | ) | — | ||||
| Loss on change in fair value of debt | 6,422 | — | |||||
| Loss on abandonment of assets | 628 | 173 | |||||
| Changes in operating assets and liabilities: | |||||||
| Accounts receivable | 1,549 | 55 | |||||
| Prepaid expenses and other current assets | (721 | ) | (205 | ) | |||
| Customer deposits | (143 | ) | — | ||||
| Related party customer deposits | (1,549 | ) | — | ||||
| Deferred revenue | (20,807 | ) | 3,695 | ||||
| Related party deferred revenue | (1,692 | ) | (553 | ) | |||
| Accounts payable | (77,537 | ) | 205 | ||||
| Accrued liabilities | 9,738 | 2,113 | |||||
| Due to customer | 4,209 | — | |||||
| Lease assets and liabilities | (8,757 | ) | 39 | ||||
| Sales and use tax payable | — | (1,568 | ) | ||||
| Other assets | — | (5,972 | ) | ||||
| CASH FLOW (USED IN) PROVIDED BY OPERATING ACTIVITIES | (75,890 | ) | 4,517 | ||||
| CASH FLOW FROM INVESTING ACTIVITIES | |||||||
| Purchases of property and equipment and other assets | (54,798 | ) | (32,591 | ) | |||
| Proceeds from sale of assets | 25,000 | — | |||||
| Finance lease prepayments | (2,808 | ) | (7,560 | ) | |||
| Purchases of investments | — | (390 | ) | ||||
| CASH FLOW USED IN INVESTING ACTIVITIES | (32,606 | ) | (40,541 | ) | |||
| CASH FLOW FROM FINANCING ACTIVITIES | |||||||
| Repayment of finance leases | (26,049 | ) | (4,849 | ) | |||
| Borrowings of long-term debt | 105,000 | 3,750 | |||||
| Borrowings of related party debt | — | 3,000 | |||||
| Repayment of long-term debt | (5,886 | ) | (3,463 | ) | |||
| Repayment of related party debt | — | (39,257 | ) | ||||
| Payment of deferred financing costs | (8,484 | ) | — | ||||
| Proceeds from issuance of common stock, net of costs | 31,590 | 64,482 | |||||
| Common stock issuance costs | (44 | ) | — | ||||
| Proceeds from issuance of preferred stock | 60,726 | — | |||||
| Preferred stock issuance costs | (5,444 | ) | — | ||||
| Dividends issued on preferred stock | (44 | ) | — | ||||
| Proceeds from issuance of SAFE agreement included in long-term debt | 12,000 | — | |||||
| CASH FLOW PROVIDED BY FINANCING ACTIVITIES | 163,365 | 23,663 | |||||
| NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH | 54,869 | (12,361 | ) | ||||
| CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD | 31,688 | 43,574 | |||||
| CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD | $ | 86,557 | $ | 31,213 | |||
| APPLIED DIGITAL CORPORATION AND SUBSIDIARIES Condensed Consolidated Statements of Cash Flows (In thousands) (Unaudited) continued | |||||
| Three Months Ended | |||||
| August 31, 2024 | August 31, 2023 | ||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | |||||
| Interest paid | $ | 5,511 | $ | 1,839 | |
| SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITIES | |||||
| Operating right-of-use assets obtained by lease obligation | $ | — | $ | 10,272 | |
| Finance right-of-use assets obtained by lease obligation | $ | 13,305 | $ | 46,952 | |
| Property and equipment in accounts payable and accrued liabilities | $ | 116,440 | $ | 6,729 | |
| Conversion of debt to common stock | $ | 56,201 | $ | — | |
| Extinguishment of non-controlling interest | $ | — | $ | 9,765 | |
| Loss from legal settlement | $ | — | $ | 2,300 | |
| Issuance of warrants, at fair value | $ | 36,479 | $ | — | |
| APPLIED DIGITAL CORPORATION AND SUBSIDIARIES Reconciliation of GAAP to Non-GAAP Measures (Unaudited) (In thousands, except percentage data) | |||||||
| Three Months Ended | |||||||
| $ in thousands | August 31, 2024 | August 31, 2023 | |||||
| Adjusted operating (loss) income | |||||||
| Operating income (loss) (GAAP) | $ | 9,483 | $ | (7,368 | ) | ||
| Stock-based compensation | (3,072 | ) | 5,641 | ||||
| Non-recurring repair expenses (1) | 32 | — | |||||
| Diligence, acquisition, disposition and integration expenses (2) | 2,888 | 10 | |||||
| Litigation expenses (3) | 407 | 381 | |||||
| Research and development expenses (4) | 36 | 184 | |||||
| Gain on classification of held for sale | (24,808 | ) | — | ||||
| Loss on abandonment of assets | 628 | — | |||||
| Accelerated depreciation and amortization (5) | 45 | 152 | |||||
| Loss on legal settlement | — | 2,300 | |||||
| Other non-recurring expenses (6) | 38 | 307 | |||||
| Adjusted operating (loss) income (Non-GAAP) | $ | (14,323 | ) | $ | 1,607 | ||
| Adjusted operating margin | (24 | )% | 4 | % | |||
| Adjusted net loss attributable to Applied Digital Corporation | |||||||
| Net loss attributable to Applied Digital Corporation (GAAP) | $ | (4,247 | ) | $ | (11,457 | ) | |
| Stock-based compensation | (3,072 | ) | 5,641 | ||||
| Non-recurring repair expenses (1) | 32 | — | |||||
| Diligence, acquisition, disposition and integration expenses (2) | 2,888 | 10 | |||||
| Litigation expenses (3) | 407 | 381 | |||||
| Research and development expenses (4) | 36 | 184 | |||||
| Gain on classification of held for sale | (24,808 | ) | — | ||||
| Accelerated depreciation and amortization (5) | 45 | 152 | |||||
| Loss on abandonment of assets | 628 | — | |||||
| Loss on change in fair value of debt | 6,422 | — | |||||
| Loss on extinguishment of debt | — | 2,353 | |||||
| Loss on legal settlement | — | 2,300 | |||||
| Other non-recurring expenses (6) | 38 | 307 | |||||
| Adjusted net loss attributable to Applied Digital Corporation (Non-GAAP) | $ | (21,631 | ) | $ | (129 | ) | |
| Adjusted net loss attributable to Applied Digital Corporation per diluted share (Non-GAAP) | $ | (0.15 | ) | $ | — | ||
| APPLIED DIGITAL CORPORATION AND SUBSIDIARIES Reconciliation of GAAP to Non-GAAP Measures (Unaudited) continued (In thousands, except percentage data) | |||||||
| Three Months Ended | |||||||
| $ in thousands | August 31, 2024 | August 31, 2023 | |||||
| EBITDA and Adjusted EBITDA | |||||||
| Net loss attributable to Applied Digital Corporation (GAAP) | $ | (4,247 | ) | $ | (11,457 | ) | |
| Interest expense, net | 7,308 | 2,133 | |||||
| Income tax expense (benefit) | — | — | |||||
| Depreciation and amortization (5) | 34,361 | 8,012 | |||||
| EBITDA (Non-GAAP) | 37,422 | (1,312 | ) | ||||
| Stock-based compensation | (3,072 | ) | 5,641 | ||||
| Non-recurring repair expenses (1) | 32 | — | |||||
| Diligence, acquisition, disposition and integration expenses (2) | 2,888 | 10 | |||||
| Litigation expenses (3) | 407 | 381 | |||||
| Research and development expenses (4) | 36 | 184 | |||||
| Gain on classification of held for sale | (24,808 | ) | — | ||||
| Loss on abandonment of assets | 628 | — | |||||
| Loss on change in fair value of debt | 6,422 | — | |||||
| Loss on extinguishment of debt | — | 2,353 | |||||
| Loss on legal settlement | — | 2,300 | |||||
| Other non-recurring expenses (6) | 38 | 307 | |||||
| Adjusted EBITDA (Non-GAAP) | $ | 19,993 | $ | 9,864 | |||
(1) Represents costs incurred in the repair and replacement of equipment at the Company's Ellendale data center hosting facility as a result of the previously disclosed power outage.
(2) Represents legal, accounting and consulting costs incurred in association with certain discrete transactions and projects.
(3) Represents non-recurring litigation expense associated with the Company’s defense of class action lawsuits and legal fees related to matters with certain former employees. The Company does not expect to incur these expenses on a regular basis.
(4) Represents specific non-recurring research and development activities related to the Company’s business expansion that the Company does not expect to incur on a regular basis.
(5) Represents the acceleration of expense related to assets that were abandoned by the Company due to operational failure or other reasons. Depreciation and amortization in this amount is included in Depreciation and Amortization expense within the Company’s calculation of EBITDA, and therefore is not added back as a management adjustment in the Company’s calculation of Adjusted EBITDA.
(6) Represents expenses that are not representative of the Company’s expected ongoing costs.
FAQ
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