Applied Digital’s fiscal 2026 second quarter results delivered a 250% year-over-year surge in sales, driven primarily by increased demand for AI data center capacity. Revenue climbed from $18.4 million to $64.4 million compared to the same period last year. However, operating expenses swelled by 230%, rising from $22.1 million to $72.8 million, as the company invested heavily in site construction, power infrastructure and hiring specialized engineering staff. The widened expense base pushed Applied Digital further into a net loss of $8.4 million for the quarter, compared to a loss of $3.2 million in Q2 2025, underscoring ongoing cash burn despite strong top-line momentum.

Applied Digital has announced plans to bring four new AI data centers online by the end of 2027, adding approximately 600 megawatts of compute capacity across Texas and Pennsylvania. Two facilities are under active construction in Grimes County, Texas, where civil works and electrical hookups have reached 45% completion, and one Pennsylvania site has secured a power purchase agreement for 200 megawatts at rates 15% below local wholesale benchmarks. The rollout schedule reflects targeted milestones: 150 megawatts of live capacity by Q4 2026 and full build-out by December 2027. These centers are designed specifically for high-performance GPUs and liquid-cooling systems, positioning Applied Digital to capture escalating demand from generative AI workloads.

To underpin its expansion strategy, Applied Digital has inked multi-year capacity agreements with CoreWeave and a second unnamed leading AI developer. The CoreWeave partnership commits 100 megawatts of capacity over a five-year term, generating a minimum annual revenue stream of $48 million once fully operational. The unnamed AI firm deal mirrors those terms and adds an option for an additional 50 megawatts if initial performance benchmarks are met. Combined, these agreements represent pre-signed commitments for roughly 65% of the company’s planned new capacity, reducing sales execution risk and providing clear revenue visibility as facilities come online.