The stock of Applied Digital (APLD) is down 11% in after hours trading after the digital infrastructure provider issued mixed quarterly financial results that disappointed Wall Street.
The Dallas, Texas-based company, which is not yet profitable, posted an earnings per share (EPS) loss of -$0.08, which was better than a loss of -$0.10 that was the consensus forecast among analysts who track the company’s progress.
Revenue in the quarter totaled $52.92 million, which was up 22% from a year earlier. However, the sales figure missed Wall Street’s estimate of $64.48 million, sending APLD stock lower. “We are confident in the progress we are making and remain committed to delivering sustainable, long-term value for our investors,” said Applied Digital CEO Wes Cummins in the company’s earnings statement.
Declining Cash Reserves
Originally a cryptocurrency mining firm, Applied Digital has evolved to become a player in the artificial intelligence (AI) infrastructure boom. Today, Applied Digital operates data centers that provide high-performance computing infrastructure for both AI and blockchain applications.
Applied Digital also reported that its operating margin at the end of the current quarter was -35.8%, an improvement from -73.2% a year earlier. However, the company’s cash position has deteriorated considerably, with Applied Digital reporting negative free cash flow of -$251.6 million, which is much worse than -$2.33 million a year ago. APLD stock has declined 30% in 2025.
Is APLD Stock a Buy?
The stock of Applied Digital has a consensus Strong Buy rating among eight Wall Street analysts. That rating is based on eight Buy recommendations issued in the last three months. The average APLD price target of $12.88 implies 140% upside from current levels. These ratings are likely to change after the company’s financial results.
