Applied Digital Corporation Q2 FY2025 Earnings Call

· Earnings call transcript and AI-powered summary

Applied Digital Fiscal Q2 2025 Earnings Summary

  • Revenue: $63.9M, up 51% YoY versus Q2 FY2024, driven by expansion in the Cloud Services segment.
  • Revenue Breakdown: $36.2M from Data Center Hosting, $27.7M from Cloud Services.
  • Adjusted Net Loss: $12.6M or $0.06/share. GAAP net loss was $138.7M or $0.66/share due to non-cash charges related to convertible debt accounting treatment.
  • Adjusted EBITDA: $21.4M, representing 93% increase YoY.
  • Cost of Revenues: $52.4M, up $22.6M YoY, reflecting energized facilities and increased services.
  • SG&A: $29.8M, up $9.5M YoY.
  • Depreciation & Amortization (D&A): $26.4M (vs $13.4M YoY), driven by GPU lease amortization. D&A in Cloud segment reduced by $8.5M due to transitioning from 2-year to 5-year amortization. Expect ~$15M/quarter going forward.
  • Interest Expense: $7.5M, up $4.9M YoY, due to finance leases and loans.
  • Cash & Equivalents: $314.6M
  • Total Debt: $479.6M

Strategic Developments

  • Macquarie Asset Management Partnership: $5B perpetual preferred equity facility.

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Operator: Good afternoon, and welcome to Applied Digital's Fiscal Second Quarter 2025 Conference Call. My name is Julian, and I'll be your operator for today. For this call, Applied Digital issued its financial results for fiscal second quarter ended November 30, 2024, and a press release, a copy of which will be furnished in a report on a Form 8-K filed with the SEC and will be available in the Investor Relations section of the company's website. Joining us today -- or joining us on today's call are Applied Digital's Chairman and CEO, Wes Cummins; and CFO, Saidal Mohmand. Following their remarks, we will open the call for questions. Before we begin, Matt Glover from Gateway Group will make a brief introductory statement. Mr. Glover, you may begin. Matt Glover: Thank you, Julian. Good afternoon, everyone, and welcome to Applied Digital's fiscal second quarter 2025 conference call. Before management begins formal remarks, we would like to remind everyone that some statements we're making today may be considered forward-looking statements under securities laws and involve a number of risks and uncertainties. As a result, we caution you that a number of factors, many of which are beyond our control, could cause actual results and events to differ materially from those described in the forward-looking statements. For more detailed risks, uncertainties and assumptions relating to our forward-looking statements, please see the disclosures in our earnings release and public filings

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