Share count
201Mpeak FY2025
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APLD, Applied Digital Corporation
We provide data center infrastructure solutions to the rapidly growing industries of high-performance computing and artificial intelligence.
We operate in two distinct business segments, blockchain data center hosting (the "Data Center Hosting Business") and HPC data center hosting (the "HPC Hosting Business"), as further discussed below.
Our Data Center Hosting Business provides energized infrastructure services to crypto mining customers.
The business
What it sells, where the money comes from, the kind of company it is.
Revenue · FY2025
$144M
+5.5% YoY
Vital signs · TTM, with 5-yr average
Revenue $319M 5-yr avg $69M
Revenue $127M +139.3% vs yr-ago qtr
Operating margin −67.6% yr-ago −35.8%
Net income ($71M) yr-ago ($36M)
Net margin −55.7% yr-ago −67.2%
The business in brief
read the 10-K →What this business is and what moves its needle, from its own SEC filings.
- Situation
- Unprofitable. No sustained operating profit across the record; an earnings multiple has nothing to rest on. What the record does show is revenue, the gross-margin trajectory, and the burn against the cash on hand.
- What moves the needle
- Operating margin has run around −77% through the cycle on a 20% gross margin, the operating line deeply negative — so the lever is the path to a margin at all: revenue growth against the cost curve and the cash runway, not the level of a margin that isn't there yet. Capital spending runs about 237% of sales, well above depreciation, so the return earned on what it sinks into that plant weighs as much as the margin. Read this kind of business on retention and the cost of growth. On its own account, the filing leans hardest on customer concentration, set against the numbers in what the filing emphasizes, below.
- Is it a good business?
- Return on capital has rarely cleared the cost of capital (median −31%, above 15% in 0 of 4 years). Owner earnings, the cash-based check, have been thin too. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the rest is in the 10-K.
Every line is arithmetic on the company's filings, shown in full in the sections below.
The record
Ten years of arithmetic, read across the cycle.
The record, 2021–2025
realized figures from each filing · older years to the left| 2021’21 | 2022’22 | 2023’23 | 2024’24 | 2025’25 | TTMTTMFeb 2026 | |
|---|---|---|---|---|---|---|
| Income statement | ||||||
| $0 | $9M | $55M | $137M | $144M | $319M | RevenueRevenue |
| — | −11% | 20% | 22% | 30% | 45% | Gross marginGross mgn |
| — | 233% | 97% | 33% | 58% | 57% | SG&A / revenueSG&A/rev |
| ($332K) | ($21M) | ($43M) | ($33M) | ($17M) | ($100M) | Operating incomeOp. inc. |
| — | −244.4% | −77.5% | −24.0% | −11.7% | −31.5% | Operating marginOp. mgn |
| ($568K) | ($24M) | ($45M) | ($149M) | ($234M) | ($192M) | Net incomeNet inc. |
| Cash flow & returns | ||||||
| ($83K) | ($872K) | $59M | $14M | ($115M) | ($36M) | Operating cash flowOp. cash |
| $1K | $1M | $7M | $21M | $17M | $29M | DepreciationDeprec. |
| $484K | $9M | $64M | $124M | $78M | $78M | Working capital & otherWC & other |
| $20K | $58M | $131M | $142M | $682M | $1.8B | CapexCapex |
| — | 681.4% | 237.0% | 103.8% | 472.7% | 556.0% | Capex / revenueCapex/rev |
| ($84K) | ($2M) | $52M | ($8M) | ($133M) | ($77M) | Owner earningsOwner earn. |
| — | −23.3% | 93.2% | −5.6% | −92.0% | −24.1% | Owner earnings marginOE mgn |
| ($103K) | ($59M) | ($73M) | ($128M) | ($797M) | ($1.8B) | Free cash flowFCF |
| — | −691.6% | −131.0% | −93.7% | −552.7% | −567.2% | Free cash flow marginFCF mgn |
| — | — | $0 | $0 | $31M | — | BuybacksBuybacks |
| — | -41% | -111% | -21% | -3% | -3% | ROICROIC |
| — | -33% | -75% | -120% | -47% | -12% | Return on equityROE |
| — | −33% | −75% | −120% | −47% | −12% | Retained to equityRetained/eq |
| Balance sheet | ||||||
| $12M | $39M | $29M | $3M | $42M | $1.7B | Cash & investmentsCash+inv |
| $0 | $227K | $82K | $4M | $3M | $21M | ReceivablesReceiv. |
| $249K | $13M | $6M | $105M | $248M | $377M | Accounts payablePayables |
| ($249K) | ($13M) | ($6M) | ($101M) | ($244M) | ($357M) | Operating working capitalOper. WC |
| $12M | $40M | $46M | $404M | $431M | $2.4B | Current assetsCur. assets |
| $3M | $29M | $115M | $554M | $558M | $1.0B | Current liabilitiesCur. liab. |
| 4.7× | 1.4× | 0.4× | 0.7× | 0.8× | 2.4× | Current ratioCurr. ratio |
| $15M | $120M | $264M | $763M | $1.9B | $6.2B | Total assetsAssets |
| $0 | $7M | — | — | — | $2.6B | Total debtDebt |
| ($12M) | ($32M) | — | — | — | $864M | Net debt / (cash)Net debt |
| -1.4× | -186.6× | -21.7× | -1.2× | -1.1× | -10.1× | Interest coverageInt. cov. |
| ($3M) | $72M | $60M | $125M | $498M | $1.6B | Shareholders’ equityEquity |
| — | 144.3% | 57.9% | 12.7% | 15.7% | 33.6% | Stock comp / revenueSBC/rev |
| Per share | ||||||
| 1.5M | 57.1M | 94.0M | 114M | 201M | 272M | Shares out (diluted)Shares |
| $0.00 | $0.15 | $0.59 | $1.20 | $0.72 | $1.18 | Revenue / shareRev/sh |
| $-0.38 | $-0.41 | $-0.48 | $-1.31 | $-1.16 | $-0.71 | EPS (diluted)EPS |
| $-0.06 | $-0.03 | $0.55 | $-0.07 | $-0.66 | $-0.28 | Owner earnings / shareOE/sh |
| $-0.07 | $-1.04 | $-0.77 | $-1.12 | $-3.96 | $-6.67 | Free cash flow / shareFCF/sh |
| $0.01 | $1.02 | $1.40 | $1.24 | $3.39 | $6.53 | Cap. spending / shareCapex/sh |
| $-1.71 | $1.27 | $0.63 | $1.09 | $2.47 | $5.82 | Book value / shareBVPS |
The diluted share count moved ×37.8 into 2022 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.
The diluted share count moved ×1.65 into 2023 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.
The diluted share count moved ×1.76 into 2025 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.
The record, charted
FY2021–2025Each measure over its full record; the current point and the worst year marked.
ROIC
−3%low FY2023
Gross margin
30%low FY2022
Owner earnings vs. net income
Owner earningsNet incomeThe accountant's number, and the cash an owner can take; the gap is the tell.
($133M)owner earningsvs.($234M)net incomelow FY2025
Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.
In fiscal 2025 the business earned ($133M) of owner earnings, the operating cash left after the $17M it takes just to hold its position. It put $664M more into growth; free cash flow, after that spending, was ($797M).
| FY2025 | FY2024 | FY2023 | FY2022 | FY2021 | |
|---|---|---|---|---|---|
| Reported net income | ($234M) | ($149M) | ($45M) | ($24M) | ($568K) |
| Depreciation & amortizationnon-cash charge added back | +$17M | +$21M | +$7M | +$1M | +$1K |
| Stock-based compensationreal costnon-cash, but a real cost | +$23M | +$17M | +$32M | +$12M | — |
| Working capital & othertiming of cash in and out, other non-cash items | +$78M | +$124M | +$64M | +$9M | +$484K |
| Cash from operations | ($115M) | $14M | $59M | ($872K) | ($83K) |
| Maintenance capital expenditurethe spending needed just to hold position and volume | −$17M | −$21M | −$7M | −$1M | −$1K |
| Owner earnings | ($133M) | ($8M) | $52M | ($2M) | ($84K) |
| Growth capital expenditurediscretionary; spent to get bigger, not to stand still | −$664M | −$120M | −$124M | −$57M | −$19K |
| Free cash flow | ($797M) | ($128M) | ($73M) | ($59M) | ($103K) |
| Owner-earnings marginowner earnings ÷ revenue | -92% | -6% | 93% | -23% | — |
Owner earnings is the cash an owner could pull out without starving the business: operating cash less the maintenance capital it must spend to hold its position (here about $17M, roughly its depreciation, the rate its assets wear out). The other $664M of its capital spending is growth it chose, not upkeep it owed; charged only with the maintenance it must do, the business earns well more than the year's free cash flow shows. The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $23M), owner earnings is nearer ($155M).
Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.
Quality & stewardship
Returns, the balance sheet, capital allocation, and pay.
Owner’s Scorecard
FY2025 10-K · source on SEC EDGAR →
Material weakness in financial controls
“We have identified a material weakness in the design of our internal controls as we did not design and maintain effective controls over the assessment of and accounting for complex financial instruments.”
The figures below are only as sound as the controls that produced them. read the note →
Will it survive?
- Can it pay its interest? -1.1×Does not cover its interestOperating income ($17M) ÷ interest expense $15M
What this means
A full year of operating profit didn't cover the interest bill. This is the zombie zone: the business depends on refinancing, asset sales, or forbearance to service its debt.
- Net cashCash $42M − debt $7M
What this means
Cash and short-term investments exceed every dollar of debt by $34M, on net the company owes nothing, and can act from strength when others can't. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
- Negative, funded by othersDSO 8 + DIO 0 − DPO 891 days
What this means
Days cash is tied up between paying suppliers and collecting from customers. A negative cycle is a quiet moat: suppliers and customers fund the operation (Buffett's “float”), the company grows on other people's money. (Little or no inventory, a services / asset-light model, so the inventory leg is ~0.)
Is it a good business?
- Below average through the cycle4-yr median, range -111%–-3%; -3% latest = NOPAT ($13M) ÷ invested capital $463MIndustry peers: median 4%
What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 4 years (it ran -3% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
- Consumes cash through the cycle4-yr median margin, range -92%–93%; latest ($133M) = operating cash ($115M) − maintenance capex $17MIndustry peers: median 11%
What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's -92% of revenue this year, a -23% median across 4 years. It chose to put $664M more into growth, so free cash flow this year was ($797M) — the gap is investment, not weakness. Treating stock comp as the real expense it is (less $23M of SBC) leaves ($155M).
- Are earnings backed by cash? ($115M)Loss, and burning cashNet income ($234M) · cash from operations ($115M)
In the filing’s words The filing discloses a material weakness in its financial controls — the reported numbers here, and the record built on them, are only as reliable as the controls that produced them.
What this means
The company reported a net loss, so a conversion ratio isn't meaningful. What matters then is whether operations still threw off cash, here, they did not.
How is the cash used?
- No surplus to allocate
What this means
The business didn't generate positive Owner Earnings this year, so any distributions came from the balance sheet or borrowing, not from operations.
- Investing or harvesting? 39.42×ExpandingCapex $682M ÷ depreciation $17M
What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.
Graham’s defensive tests · 0 of 5 met
Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.
- Adequate size MissRevenue ≥ $2B · $144M
What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
- Strong liquidity MissCurrent ratio ≥ 2× · 0.77×
What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
- Conservative debt MissDebt ≤ working capital · $7M vs ($128M) WC
What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
- Earnings stability MissA profit every year (5-yr record) · 5 loss years
What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
- Dividend record MissUninterrupted dividends · none paid
What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
- Moderate price —P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price
What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $-0.50/share (latest year $-0.82), the averaged base the calculator's gate runs on, and book value is $1.74/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.
Durability & moat, 2021–2025
Whether the record’s returns held, and what the capital reinvested earned.
- Profitable years 0 of 5
What this means
Lost money in 5 year(s), look at what happened there before trusting the average.
- Operating margin −161% → −18% (2-yr avg ends)
What this means
Through the cycle the operating margin widened — about −161% early to −18% lately, median −77% — pricing power intact or improving.
- Reinvestment, incremental ROIC returns capital
What this means
The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.
- Worst year 2022 · −244.4% op. margin
What this means
Operations went underwater in 2022, understand why before trusting the good years.
Does AI threaten the moat?
Elevated contestabilityThe product is software or information, the very thing capable AI now produces more cheaply, so the moat is more contestable than the record alone implies.
In its own filing Raised, but not as a competitor
The filing raises AI among its risks, but in other terms (security, regulation, energy or the like), not as a competitor to its product; it frames AI mainly as a capability.
The product is the kind capable AI most directly contests: when a substitute can be built cheaply, the incumbent's pricing power is the first thing at risk. The record cannot say whether the moat outlasts that; past durability is a starting point, not a promise.
Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.
All figures as filed; the source filing is linked above.
Current Position
as of the latest quarter, Feb 28, 2026Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.
Current assets$2.4B
- Cash & short-term investments$1.7B
- Receivables$21M
- Other current assets$677M
Current liabilities$1.0B
- Accounts payable$377M
- Other current liabilities$642M
Current ratio2.38×all current assets ÷ what's due · Graham looked for 2×
Quick ratio2.38×stricter: inventory excluded
Cash ratio1.70×strictest: cash alone against what's due
Working capital$1.4Bthe cushion left after near-term bills
Cash runway1.0 yrsthe business is consuming cash; this is how long the cash on hand lasts at that rate
Revenue, latest quarter vs. a year ago+139.3%the freshest read on whether the business is still growing
Current ratio, recent quarters0.7× → 2.4×
Deeper floors
Tangible book value$1.6Bequity stripped of goodwill & intangibles
Net current asset value($1.3B)Graham's net-net: current assets less all liabilities
Debt incl. operating leases$70M$63M of it operating leases
Deferred revenue$15Mcustomer cash collected before delivery; operating float
From the company's latest filing.
Management, ownership & pay
read the proxy →From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.
| Fiscal year | Pay, as filed | “Actually paid” | Owner earnings |
|---|---|---|---|
| 2023 | $6.0M | $19.5M | $52M |
| 2023 | $6.0M | $19.5M | $52M |
| 2024 | $1.2M | −$2.9M | ($8M) |
| 2024 | $1.2M | −$2.9M | ($8M) |
| 2025 | $27.7M | $29.6M | ($133M) |
| 2025 | $27.7M | $29.6M | ($133M) |
Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.
- Stock-based compensation$23M
The slice of the business handed to employees in shares this year, 16% of revenue. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.
Inverting the record
Invert: instead of why Applied Digital Corporation is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2021–2025.
2 of the 3 tests turned up something to look into; the other 1 came back clean.
- Look hereIs it less profitable than it was?−48.8% vs 34.9%
The owner-earnings margin averaged 34.9% early in the record and −48.8% across the last three years, and the latest year has not recovered. Ask the filing whether that is a structural drift or a cyclical trough — price, mix, cost, or a competitor — and whether it is permanent.
- Look hereDid debt outgrow the business?$0 → $2.6B
Debt rose from $0 to $2.6B while owner earnings went from about $17M to ($30M): the borrowing grew and the earnings that would carry it are not there now. Debt raised for buybacks or deals rather than growth is the kind that bites in a downturn.
And these came back clean
- Are "one-time" charges a yearly habit?
Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.
Peers, IT Services & Consulting
The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.
| Company | Revenue | Gross margin | Op. margin | ROIC | Owner earn. margin |
|---|---|---|---|---|---|
| CRWVCoreWeave Inc. | $5.1B | 72% | -0.9% | -0% | 98% |
| EQPTEquipmentShare.com Inc | $4.4B | 28% | 6.8% | 6% | -1% |
| CTOSCustom Truck One Source Inc. | $1.9B | 24% | 7.0% | 4% | 11% |
| CCOClear Channel Outdoor Holdings Inc. | $1.6B | — | 12.3% | 11% | -3% |
| CTEVClaritev Corporation | $965M | — | 9.9% | -1% | 22% |
| HRIHerc Holdings Inc. Common Stock | $862M | 95% | 11.2% | 6% | 31% |
| NPKINPK International Inc. | $277M | 19% | 3.8% | 3% | 1% |
| APLDApplied Digital Corporation | $144M | 21% | -50.8% | -31% | -14% |
| Group median | — | 26% | 6.9% | 4% | 6% |
The price
What a price has to assume.
What the price implies
reverse-DCFApplied Digital Corporation is profitable, but owner earnings are negative this year because capital spending currently outruns operating cash, a build-out, so the owner-earnings reverse-DCF has no positive base to grow. We read the price from both ends instead: type a price to see the steady-state profitability it demands, then set the mature margin you would believe and weigh the two against each other. Nothing leaves your browser unless you enter it in your notebook.
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The assumptions
Enter a price to run it.
Owner earnings it must reach—
Margin the price demands—
Owner-earnings margin today−567%
A dated snapshot of the price you typed, the assumptions you set, and what the page showed for them. A snapshot is never edited after it is saved. Your notebook is yours alone — the commitment states what is stored and what we will never do.
Two reads of one future. From your price: the owner earnings the company must reach, valued at a mature multiple and discounted back at your rate, expressed as the margin it implies on revenue grown at your rate. From your belief: the mature margin you would credit, set on the dial above. When the margin the price demands runs above the one you would believe, you are paying for a future taken on faith. For a deep cyclical at a trough, normalized through-cycle earnings are the better lens; this mode is for the genuinely unprofitable, and for the profitable business whose capital spending currently outruns its cash.
Cite: Owner Scorecard, "Applied Digital Corporation (APLD), the owner's record," https://ownerscorecard.com/c/APLD, data as of 2026-07-09.
Manual order: ← APH its page in the Manual APLE →
Industry order: ← ADP the IT Services & Consulting chapter ATGL →