The business model relies on leasing capacity, long-term hosting contracts and value-added services; revenue and margins are sensitive to utilisation rates, pricing and energy costs. Applied Digital reiterated its long-term goal of $1 billion in net operating income (NOI) within five years, supported by a robust pipeline. The company is expanding capacity through multiple facilities including Polaris Forge and Delta Forge data centers.
Cyborg Score Rationale
Revenues of $126.6 million in fiscal Q2 2026 were up 250% from the prior year comparable period. However, profitability remains challenged with negative net income and cash flow. Post-earnings, shares dipped 4-8% amid concerns over rising debt, including a $2.15 billion notes offering.
Top Insights
Q2 2026 revenues surged 250% year-over-year to $126.6 million, driven by AI hyperscaler demand, though the company remains unprofitable on a net income basis as it scales.
Polaris Forge 1 (100 MW) is operational, with a second 150 MW facility under construction for late 2026, positioning the company to capture growing demand for AI compute capacity.
Polaris Forge 2 secured a 15-year, 200 MW lease with an investment-grade hyperscaler, funded partly by the recent $2.15 billion notes, anchoring revenue stability but increasing leverage.
Named Competitors
CoreWeave — GPU cloud platform for AI and ML workloads
Crusoe Energy — AI data center infrastructure provider
Lambda Cloud — GPU cloud computing for AI and deep learning
Recent Developments
(January 2026) Fiscal Q2 2026 results showed 250% revenue growth to $126.6 million
(April 2026) Fiscal Q3 2026 results reported; reiterated $1 billion NOI goal within five years
(December 2025) Proposed business combination of cloud business with EKSO Bionics to form ChronoScale
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