Applied Digital Q1 Revenue Jumps 322% on AI Data Centers

Applied Digital just showed what an AI data center buildout looks like on an income statement. The company (Nasdaq: APLD) reported fiscal first-quarter 2027 results on October 7, 2026, with revenue of $341.9 million, up 322% from $80.9 million a year earlier. If you want to understand where AI infrastructure money is going, this report is a handy case study.

• Revenue: $341.9 million for the quarter ended August 31, 2026, up 322% year over year.
• Adjusted EBITDA: $64.4 million, compared with $0.5 million a year earlier.
• Contracted: about 1.41 GW of critical IT load leased across five campuses, worth about $36 billion over initial lease terms.
• Bottom line: a GAAP net loss of $237.1 million, or $0.82 per share, as the company builds.

What Drove Applied Digital's 322% Revenue Growth?

One segment did the heavy lifting. HPC Hosting, the business that builds and leases data centers for AI workloads, brought in $262.6 million. Per the company's SEC filing, that breaks down into $65.8 million of base rent, $183.5 million of tenant fit-out revenue and $13.3 million of tenant recoveries.

That mix is worth a second look. Fit-out revenue comes from building out space for tenants, so it tracks construction activity. Base rent is the recurring part, and it grows as buildings are handed over. The older Data Center Hosting segment was steady at $37.8 million.

The flagship site is Polaris Forge 1 in Ellendale, North Dakota, leased to CoreWeave. It reached 250 MW of live capacity after a 75 MW phase was delivered on October 1, and a third 150 MW building is under construction.

How Big Is the AI Data Center Backlog?

This is the number that gets attention. Applied Digital says it has about 1.41 gigawatts of critical IT load under lease across five campuses in North Dakota, Louisiana and Alabama. Those leases represent about $36 billion of contracted revenue over their initial terms, or about $86 billion if every renewal option is exercised.

The newest piece is Delta Forge 2 in Alabama: 210 MW on a 15-year lease worth about $5.2 billion in base-term revenue. Tenants on the newer campuses are described as investment-grade hyperscalers.

Management expects delivered capacity across its North Dakota campuses to reach 300 MW by the end of calendar 2026. The company also signed an agreement covering up to about 1 GW of potential power capacity in Finland and a power purchase agreement for about 1,200 MW of natural gas generation in North Dakota.

Is Applied Digital Profitable Yet?

Not on a GAAP basis, and it is better to say that plainly. The net loss attributable to common stockholders was $237.1 million, or $0.82 per share. On an adjusted basis, the loss was $4.1 million, or $0.01 per share, and adjusted EBITDA was $64.4 million. Adjusted figures exclude items the company considers outside core operations, so look at both sets.

Building at this scale takes capital. Total debt stood at about $6.4 billion at quarter end, including $1.59 billion of 7.000% senior secured notes due 2031. That is the trade-off with data center developers: long-term leases with large customers on one side, and heavy upfront spending and financing on the other.

What Should Investors Watch Next?

A few practical markers:

• Deliveries: whether the 300 MW North Dakota target is met by year end.
• Revenue mix: base rent rising as a share of HPC Hosting revenue.
• Financing: how the remaining campuses are funded as construction continues.

CEO Wes Cummins said the company is "building for the long term." The broader read-through is that demand for AI capacity is showing up as signed, multi-year leases, which lines up with what memory makers are reporting, as we saw in Micron's fiscal Q4 results.

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Sources: SEC — Applied Digital fiscal Q1 2027 earnings release (Form 8-K exhibit) — October 7, 2026.