Applied Digital reported fiscal Q4 and full‑year 2026 results showing sharp revenue growth and a flurry of multi‑billion dollar, long‑term leases that push its contracted AI data‑center load to roughly 1.4 gigawatts. The Dallas‑based company also closed large debt financings, completed a cloud‑services separation into ChronoScale, and highlighted a strategic power initiative tied to new gas generation.
Applied Digital posts FY2026 results and secures 1.4GW of contracted critical IT load
For the fiscal fourth quarter ended May 31, 2026, Applied Digital reported revenues of $258.7 million, up 407% year over year, and an adjusted EBITDA of $42.4 million. For the full fiscal year, revenues were $611.3 million, up 167% year over year, with adjusted EBITDA of $107.2 million. The company recorded a GAAP net loss attributable to common stockholders of $110.6 million for the quarter and $249.2 million for the year; its non‑GAAP adjusted net income for the quarter was $12.9 million.
Operationally, Applied Digital said it has long‑term leases representing approximately 1,410 MW of contracted critical IT load across five campuses — Polaris Forge 1, 2 and 3 in North Dakota and Delta Forge 1 and 2 in Louisiana and another southern state — which it says represent about $36 billion of contracted revenue over the initial 15‑year base lease terms.
Deals, financing, and the ChronoScale separation
During the quarter the company signed three separate 15‑year take‑or‑pay leases with a single “high investment‑grade hyperscaler.” Two leases — 300 MW each at Delta Forge 1 and Polaris Forge 3 — are described as providing approximately $7.5 billion in base‑term revenue each, and a subsequent 210 MW lease at Delta Forge 2 provides about $5.2 billion in base‑term revenue. Applied Digital aggregates these and other agreements to describe roughly $36 billion in base‑term contracted revenue and about $86 billion if all renewal options are exercised.
To fund construction and development, Applied Digital completed multiple financings: a $2.15 billion private offering of 6.750% senior secured notes due 2031 issued through a subsidiary; a $1.59 billion offering of 7.000% senior secured notes due 2031 issued after the quarter; and revolving credit facilities arranged by Goldman Sachs totaling up to $550 million initially, later upsized to $430 million committed with a $120 million accordion remaining. The company also closed a $300 million bridge facility that it subsequently repaid with the senior secured notes proceeds.
Applied Digital completed the separation of its cloud services business on May 5, 2026, combining it with Ekso Bionics to form ChronoScale Holdings Corporation (Nasdaq: CHRN). Applied Digital said it currently owns approximately 96% of ChronoScale and consolidates its results for GAAP purposes while excluding ChronoScale from the non‑GAAP measures presented in the release.
Why it matters
The results and commercial commitments make Applied Digital a material player in purpose‑built, high‑power AI data‑center capacity. The company’s reported revenue growth reflects initial deliveries of HPC hosting services: in Q4 the Polaris Forge 1 campus began contributing base rent and tenant fit‑out services, which together drove most of the services revenue increase the company reported.
For investors and customers, the 15‑year take‑or‑pay leases with a high credit‑quality buyer provide predictable long‑term cash flows that underpin large financings and development spending. Applied Digital’s ability to secure multiple, consecutive large leases with the same hyperscaler — across different states and campuses — signals repeatable demand and supports its “franchise model” for replicating design, construction and operations teams.
Power strategy, hosting margins and remaining capacity
Applied Digital highlighted its data‑center hosting business that supports bitcoin mining as a high‑return asset: the company operates 286 MW for mining customers across two North Dakota sites and reported $37.3 million in quarterly hosting revenue with $12.5 million of segment operating profit on $113.8 million of reported assets. This contrasts with the HPC Hosting segment, which generated $203.0 million in the quarter but incurred large tenant fit‑out costs that elevated services cost of revenues.
The company is also advancing a strategic power initiative to access lower‑cost, reliable generation. Applied Digital said it has an investment in Base Electron Corp., which has engaged Babcock & Wilcox to develop about 1.2 GW of front‑of‑the‑meter natural gas‑fired generation in the Dakotas; Applied Digital shareholders own approximately 10% of Base Electron. That planned generation is presented as a way to deepen access to capacity and lower power cost — a key input to high‑density AI and mining economics.
What to watch next
Key near‑term items include the company’s construction and commercial milestones: Applied Digital reported Phase 1 of Building 2 (75 MW) at Polaris Forge 1 reached Ready for Service on schedule, bringing live campus capacity to 175 MW. Observers should track the timeline for initial operations at Delta Forge 1 and Polaris Forge 3 (expected in calendar 2027) and Delta Forge 2 (expected in H1 2028) as those are tied to the multibillion dollar lease revenues the company cites.
On financing and credit, watch for the practical effects of the newly issued senior secured notes, the revolver upsizing, and the company’s restructuring steps around CoreWeave leases — including an assignment MOU and springing guarantees noted in the release — which the company says enhance credit quality for some leases. Separately, the market performance and operating independence of ChronoScale (Applied Digital retains ~96%) will determine how the split affects Applied Digital’s consolidated and non‑GAAP metrics going forward.
Applied Digital’s quarter shows a company transitioning from early deliveries to large‑scale execution: the firm has locked long dated demand and raised capital, but the pace of campus build‑outs, power projects and the separation’s ripple effects will determine near‑term cash flow and margin trajectories.
Source: Applied Digital Corporation (APLD)