Applied Digital Corporation (NASDAQ: APLD) demonstrated impressive financial progress in its second quarter, outperforming Wall Street estimates for adjusted earnings per share (EPS) and revenue. The firm reported an adjusted EPS of zero cents, surpassing the consensus expectation of a loss of 10 cents per share. Concurrently, its sales reached $126.58 million, significantly above the anticipated $89.75 million.
The substantial 250% annual increase in revenue was predominantly fueled by growth within Applied Digital's High-Performance Computing (HPC) Hosting segment. A key operational achievement during the quarter was the attainment of Ready-for-Service status at the company's Polaris Forge 1 campus. This development included the on-schedule delivery of 100 megawatts of power capacity and the full energization of the campus's initial building, marking a critical milestone in the company's infrastructure expansion.
Financially, this accomplishment translated into approximately $85 million in payments from CoreWeave, Applied Digital's tenant. Of this amount, $73 million pertained to tenant-specific fit-out services, while the remaining $12 million related to lease revenues accruing over part of the quarter. These cash inflows demonstrate effective execution of tenant agreements and infrastructure readiness to support client needs.
Beyond Polaris Forge 1, Applied Digital's Data Center Hosting division sustained its robust performance, generating $41.6 million in revenue during the quarter. This reflects operational improvements and enhanced facility outputs across the company's hosting portfolio, indicating continued momentum in its core business activities.
From a profitability standpoint, the company recorded adjusted EBITDA of $20.2 million, a notable increase from $6.1 million in the same period last year. Meanwhile, the net loss attributable to common stockholders improved substantially, shrinking from $129 million a year earlier to $31.2 million. These metrics highlight the company's trajectory towards improved operational efficiency and cost management.
During the quarter, Applied Digital undertook significant financing activities, completing a $2.35 billion private placement of senior secured notes. Additionally, the company accessed further capital through its preferred equity financing facility. These measures reinforced the company's liquidity position, which stood strong at approximately $2.3 billion in cash, cash equivalents, and restricted cash by the end of the quarter.
Market response to these results was positive, with Applied Digital's shares appreciating by over 10% in trading following the earnings release. At the time of reporting, the stock traded near $32.56 per share, reflecting investor confidence in the company's recent operational achievements and financial improvements.