Applied Digital Corporation (Nasdaq: APLD)
("Applied Digital" or the "Company"), a designer,
builder, and operator of next-generation digital infrastructure
designed for High-Performance Computing (“HPC”) applications, cloud
services (“Cloud services”), and datacenter hosting (“Datacenter
hosting”), reported financial results for the fiscal third quarter
ended February 29, 2024. The Company also provided an
operational update.
Fiscal Third
Quarter 2024 Financial
and Operational Highlights
- Total revenue of
$43.3 million
- Adjusted EBITDA
loss of $2.3 million
- Despite the
considerable challenges from the outages at Ellendale, our HPC and
Cloud Services sectors continue to make strides with additional
clusters deployed, and we continue to make progress in our
Ellendale HPC facility construction.
Post-Quarter Operational
Highlights
- Significantly
strengthened balance sheet with $160 million of announced asset
sales and financing transactions.
- Entered into
exclusivity and executed a letter of intent (the "LOI") with a
US-based hyperscaler for a 400 MW capacity lease, inclusive of our
current 100 MW facility and two forthcoming buildings. In advanced
discussions for project-level financing for this investment-grade
tenant.
- Started
receiving new equipment deliveries and on track to incrementally
restore Ellendale's capacity over the next two months, targeting to
achieve 65%-75% capacity by the end of May.
Adjusted EBITDA is a non-GAAP measure.
Reconciliations of adjusted EBITDA to the most directly comparable
financial measure presented in accordance with accounting
principles generally accepted in the United States ("GAAP") is set
forth in the schedule accompanying this release. See
“Reconciliation of GAAP to Non-GAAP Measures.”
Management Commentary
"During the quarter, Applied Digital encountered
several challenges that impacted our financial performance due to
facility power outages in our datacenter hosting business. Despite
these short-term setbacks, we made significant progress with our
key growth initiatives in the development of our Cloud Services
business and the establishment of our special purpose built 100 MW
HPC datacenter in Ellendale," stated Wes Cummins, Chairman and CEO
of Applied Digital. "Other achievements included welcoming our
newest Cloud Services customer, Together AI, and the strategic
decision to divest our Garden City Facility."
"Moreover, we are pleased to announce a pivotal
advancement. We have entered into exclusivity and executed an LOI
with a US-based hyperscaler for a 400 MW capacity lease of our
Ellendale HPC campus. This encompasses our 100 MW facility under
construction and plans for two additional buildings. In addition,
we continue to see outsized demand for HPC hosting capacity at our
differentiated Ellendale campus. where we have more than 600MW of
future capacity. We are progressing with project level financing
tailored for this investment-grade tenant. This milestone advances
our strategic growth initiatives and stands as an impressive
achievement for our organization."
"Looking forward, we are encouraged by the
robust demand we are witnessing across our business. We believe we
are well-positioned to execute our growth strategy and capitalize
on the increasing opportunities presented by both traditional
customers and emerging HPC applications."
Cloud Service Update
Applied Digital’s Cloud Services provides
high-performance computing power for artificial intelligence and
machine learning applications. The Company continues to seek and
sign additional customers, and the pipeline remains robust. During
the fiscal third quarter, we did experience a substantial drag on
earnings, adjusted earnings and EBITDA from expenses resulting from
increased levels of in-service equipment that were not yet
contributing to revenue generation. Near the end of the quarter,
more of this equipment began generating revenue, which we expect
will make a positive impact on the financial performance of this
segment in the fiscal fourth quarter.
High-Performance Computing (HPC)
Datacenter Hosting Update
Applied Digital’s HPC hosting business designs,
builds, and operates next-generation data centers, which are
designed to provide massive computing power and support
high-performance computing applications within a cost-effective
model. During the fiscal second quarter, the Company broke ground
on its first 100 MW high-performance compute facility in Ellendale,
North Dakota. The new 342,000-square-foot building will provide
ultra-low-cost and highly efficient liquid-cooled infrastructure
for HPC applications.
The Company has entered into exclusivity and
executed an LOI with a US-based hyperscaler for a 400 MW capacity
lease, inclusive of our current 100 MW facility and two forthcoming
buildings in Ellendale, North Dakota. The Company is in advanced
discussions with traditional financing counterparties for this
investment-grade tenant. The exclusive negotiation period with the
initial HPC anchor tenant identified for our Ellendale campus
expired at the end of March.
Datacenter Hosting Update
The Company’s 100 MW facility in Jamestown,
North Dakota, operated at full capacity during the quarter ended
February 29, 2024; however, the Company’s 180 MW facility in
Ellendale, North Dakota experienced a power outage starting in
January. In response to these challenges, our utility provider
installed equipment to enable us to selectively power-down the
affected portions of our site. Upon re-energization we have
determined the failures were due to transformers not meeting
industry standards. The Company has successfully procured new
transformers and related components from North American
industry-leading manufacturers. As of the date of this report, the
Ellendale facility has begun energization and has been re-energized
to approximately 14% of its full capacity, or 25 MW. In addition,
the Company anticipates that as new transformers are received and
installed, the Ellendale facility will target operating capacity of
approximately 65%-75% of full capacity by the end of May 2024.
Financial Results for Fiscal
Third Quarter
2024 Ended
February 29, 2024
Balance Sheet
Applied Digital ended the fiscal quarter with
cash, cash equivalents, and restricted cash of $41.0 million
and $61.8 million in debt outstanding.
Operating Results
Total revenues in the fiscal third quarter 2024
were $43.3 million, up 208% from the fiscal third quarter 2023. The
increase in revenues were driven by increased capacity across the
Company’s three datacenter hosting facilities between periods as
well as the Company's recognizing revenue under its Cloud services
segment which began providing service during the current fiscal
year.
Cost of revenues in the fiscal third quarter
2024 was $47.1 million compared to $10.5 million in the fiscal
third quarter 2023. The increase in the cost of revenues was
attributable to higher energy costs due to a higher number of MWs
online. The increase was also driven by increases in depreciation
and amortization expense and personnel expenses primarily driven by
the growth in the business as more facilities were energized
compared to the fiscal third quarter of 2023.
Selling, general and administrative expenses in
the fiscal third quarter 2024 were $30.4 million compared to
$10.5 million in the fiscal third quarter of 2023. The
increase in selling, general and administrative expenses, which, by
nature, are not directly attributable to revenue generation, was
primarily driven by an increase in depreciation and amortization
expense for equipment not yet supporting revenue, an increase in
lease expenses for facilities that have not yet begun generating
revenue, and an increase in professional service expenses related
to legal services associated with discrete transactions and
projects as well as general support of the growth of the business
compared to the fiscal third quarter 2023.
Net loss for the fiscal third quarter 2024 was
$62.8 million, or $0.52 per basic and diluted share, based on a
weighted average share count during the quarter of 121.4 million.
This compares to a net loss of $7.3 million, or $0.07 per basic and
diluted share, based on a weighted average share count of 94.1
million for the fiscal third quarter 2023.
Adjusted EBITDA, a non-GAAP measure, for the
fiscal third quarter 2024 was loss of $2.3 million compared to an
Adjusted EBITDA of $0.9 million for the fiscal third quarter 2023.
Adjusted EBITDA was negatively impacted by $4.8 million of expenses
associated with facilities that are not yet generating revenue.
Adjusted net loss, a non-GAAP measure, for the
fiscal third quarter of 2024, was $28.9 million or adjusted net
loss per basic and diluted share of $0.24, based on a weighted
average share count during the quarter of approximately 121.4
million. This compares to an adjusted net loss, a non-GAAP measure,
of $1.4 million, or $0.01 per basic and diluted share, for the
fiscal third quarter of 2023 based on a weighted average share
count during the quarter of approximately 94.1 million. Adjusted
net loss was negatively impacted by $15.6 million of expenses
associated with facilities and equipment that are not yet
generating revenue.
Cash Flows
The Company experienced a net decrease in cash,
cash equivalents, and restricted cash during the nine months ended
February 29, 2024 of $2.6 million. The primary drivers of
the change were:
- Purchase of
property, equipment, and other assets of $87.0 million, driven
by construction of the Company's HPC hosting datacenter;
- Finance lease
prepayments of $35.1 million and finance leases recurring
payments of $27.5 million, primarily driven by the Company's
leases of hosting equipment for Cloud services; and
- Debt repayments
of approximately $52.3 million.
These were partially offset by the
following:
- Net cash
received from operating activities of $47.9 million, driven by
the recurring operations of the business;
- Borrowings of
$31.4 million including funding received from related party
loans; and
- Net cash
received from the issuance of common stock of $121.0 million
under the Company's at-the-market sales agreement.
Conference Call
Applied Digital will host a conference call
today, April 11, 2024, at 5:00 p.m. Eastern Time (2:00 p.m.
Pacific Time) to discuss these results. A question-and-answer
session will follow the management’s presentation.
U.S. dial-in number: 1-877-407-0792International
number: 1-201-689-8263Conference ID: 13745379
The conference call will broadcast live and be
available for replay here.
Please call the conference telephone number
approximately 10 minutes before the start time. An operator will
register your name and organization. If you have any difficulty
connecting with the conference call, please contact Applied
Digital’s investor relations team at 1-949-574-3860.
A replay of the call will be available after
9:00 p.m. Eastern Time April 11, 2024, through April 25, 2024.
Toll-free replay number:
1-844-512-2921International replay number: 1-412-317-6671Conference
ID: 13745379
About Applied Digital
Applied Digital Corporation (Nasdaq: APLD)
designs, develops, and operates next-generation data centers across
North America to provide digital infrastructure solutions to the
rapidly growing high-performance computing (HPC) industry. Find
more information at www.applieddigital.com. Follow us on X
(formerly Twitter) at @APLDdigital.
Forward-Looking Statements
This release contains "forward-looking
statements" as defined in the Private Securities Litigation Reform
Act of 1995 regarding, among other things, future operating and
financial performance, product development, market position,
business strategy and objectives. These statements use words, and
variations of words, such as "continue," "build," "future,"
"increase," "drive," "believe," "look," "ahead," "confident,"
"deliver," "outlook," "expect," and "predict." Other examples of
forward-looking statements may include, but are not limited to, (i)
statements of Company plans and objectives, including our evolving
business model, or estimates or predictions of actions by
suppliers, (ii) statements of future economic performance, and
(iii) statements of assumptions underlying other statements and
statements about the Company or its business. You are cautioned not
to rely on these forward-looking statements. These statements are
based on current expectations of future events and thus are
inherently subject to uncertainty. If underlying assumptions prove
inaccurate or known or unknown risks or uncertainties materialize,
actual results could vary materially from the Company's
expectations and projections. These risks, uncertainties, and other
factors include: decline in demand for our products and services;
the volatility of the crypto asset industry; the inability to
comply with developments and changes in regulation; cash flow and
access to capital; and maintenance of third party relationships.
Information in this release is as of the dates and time periods
indicated herein, and the Company does not undertake to update any
of the information contained in these materials, except as required
by law.
Use and Reconciliation of Non-GAAP
Financial Measures
To supplement our consolidated financial
statements presented in accordance with accounting principles
generally accepted in the United States of America (“GAAP”), we are
presenting certain non-GAAP financial measures. We are providing
these non-GAAP financial measures to disclose additional
information to facilitate the comparison of past and present
operations by providing perspective on results absent one-time or
significant non-cash items. We utilize these measures in the
business planning process to understand expected operating
performance and to evaluate results against those expectations. We
believe that these non-GAAP financial measures, when considered
together with our GAAP financial results, provide management and
investors with an additional understanding of our business
operating results regarding factors and trends affecting our
business and provide a reasonable basis for comparing our ongoing
results of operations.
These non-GAAP financial measures are provided
as supplemental measures to the Company’s performance measures
calculated in accordance with GAAP and therefore, are not intended
to be considered in isolation or as a substitute for comparable
GAAP measures. Further, these non-GAAP measures have no
standardized meaning prescribed by GAAP and are not prepared under
any comprehensive set of accounting rules or principles. Because of
the non-standardized definitions of non-GAAP financial measures, we
caution investors that the non-GAAP financial measures as used by
us in this release have limits in their usefulness to investors and
may be calculated differently from, and therefore may not be
directly comparable to, similarly titled measures used by other
companies. Further, investors should be aware that when evaluating
these non-GAAP financial measures, these measures should not be
construed as an inference that the Company's future results will be
unaffected by unusual or non-recurring items. In addition, from
time to time in the future there may be items that we may exclude
for purposes of our non-GAAP financial measures and we may in the
future cease to exclude items that we have historically excluded
for purposes of our non-GAAP financial measures. Likewise, we may
determine to modify the nature of the adjustments to arrive at our
non-GAAP financial measures. Investors should review the non-GAAP
reconciliations provided below and not rely on any single financial
measure to evaluate the Company’s business.
Change in Presentation
Beginning in the third quarter of 2024, the
Company updated its presentation of non-GAAP measures. As a result
of this updated presentation, the Company no longer excludes
start-up costs as an adjustment to Operating loss, Net loss, or
EBITDA in our calculation of Adjusted operating loss, Adjusted net
loss, Adjusted net loss per diluted share, and Adjusted EBITDA.
EBITDA, Adjusted EBITDA, Adjusted net loss, and Adjusted net loss
per diluted share are non-GAAP measures and are defined below.
Adjusted Operating Loss, Adjusted Net
Loss, and Adjusted Net Loss per Diluted Share
“Adjusted Operating Loss” and “Adjusted Net
Loss” are non-GAAP measures that represent operating loss and net
loss, respectively, excluding stock-based compensation, litigation
expenses, non-recurring professional service costs, non-recurring
research and development expenses, loss on classification of held
for sale, loss on abandonment of assets, and loss on legal
settlement. Adjusted net loss is further adjusted for the loss on
the change in fair value of related party debt and the loss on
extinguishment of debt. We define “Adjusted Net Loss per Diluted
Share” as Adjusted net loss divided by weighted average diluted
share count.
EBITDA and Adjusted EBITDA
“EBITDA” is defined as earnings before interest,
taxes, and depreciation and amortization. “Adjusted EBITDA” is
defined as EBITDA adjusted for stock-based compensation, litigation
expenses, non-recurring professional service costs, non-recurring
research and development expenses, loss on classification of of
held for sale, loss on abandonment of assets, loss on the change in
fair value of related party debt, loss of extinguishment of debt,
and loss on legal settlement.
Investor Relations ContactsMatt Glover or Alex
KovtunGateway Group, Inc.(949) 574-3860APLD@gateway-grp.com
Media ContactBrenlyn Motlagh or Diana Jarrah
Gateway Group, Inc.(949) 899-3135APLD@gateway-grp.com
APPLIED DIGITAL CORPORATION AND
SUBSIDIARIESCondensed Consolidated Balance Sheets
(Unaudited)(In thousands, except share and par
value data) |
|
|
February 29, 2024 |
|
May 31, 2023 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
4,435 |
|
|
$ |
28,999 |
|
Restricted cash |
|
29,545 |
|
|
|
14,575 |
|
Accounts receivable |
|
225 |
|
|
|
82 |
|
Prepaid expenses and other current assets |
|
6,127 |
|
|
|
2,012 |
|
Current assets held-for-sale |
|
65,369 |
|
|
|
— |
|
Total current assets |
|
105,701 |
|
|
|
45,668 |
|
Property and equipment,
net |
|
211,172 |
|
|
|
195,593 |
|
Operating lease right of use
assets, net |
|
95,429 |
|
|
|
1,290 |
|
Finance lease right of use
assets, net |
|
189,627 |
|
|
|
14,303 |
|
Other assets |
|
41,239 |
|
|
|
7,103 |
|
TOTAL
ASSETS |
$ |
643,168 |
|
|
$ |
263,957 |
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
Current liabilities: |
|
|
|
Accounts payable |
$ |
93,918 |
|
|
$ |
6,446 |
|
Accrued liabilities |
|
27,545 |
|
|
|
9,960 |
|
Current portion of operating lease liability |
|
13,023 |
|
|
|
320 |
|
Current portion of finance lease liability |
|
86,438 |
|
|
|
5,722 |
|
Current portion of debt |
|
19,329 |
|
|
|
7,950 |
|
Customer deposits |
|
32,410 |
|
|
|
32,560 |
|
Related party customer deposits |
|
3,810 |
|
|
|
3,810 |
|
Deferred revenue |
|
63,121 |
|
|
|
47,168 |
|
Related party deferred revenue |
|
1,287 |
|
|
|
1,524 |
|
Current liabilities held-for-sale |
|
8,279 |
|
|
|
— |
|
Total current liabilities |
|
349,160 |
|
|
|
115,460 |
|
Long-term portion of operating lease liability |
|
69,260 |
|
|
|
1,005 |
|
Long-term portion of finance lease liability |
|
63,803 |
|
|
|
8,334 |
|
Long-term debt |
|
24,845 |
|
|
|
33,222 |
|
Long-term related party loan |
|
17,612 |
|
|
|
35,257 |
|
Other long-term related party liabilities |
|
— |
|
|
|
1,000 |
|
Total liabilities |
|
524,680 |
|
|
|
194,278 |
|
Commitments and
contingencies |
|
|
|
Stockholders' equity: |
|
|
|
Common stock, $0.001 par value, 166,666,667 shares authorized,
127,486,937 shares issued and 122,417,839 shares outstanding at
February 29, 2024, and 100,927,358 shares issued and
95,925,630 shares outstanding at May 31, 2023 |
|
127 |
|
|
|
101 |
|
Treasury stock, 5,069,098 shares at February 29, 2024 and
5,001,728 shares at May 31, 2023, at cost |
|
(62 |
) |
|
|
(62 |
) |
Additional paid in capital |
|
303,963 |
|
|
|
160,194 |
|
Accumulated deficit |
|
(185,540 |
) |
|
|
(100,716 |
) |
Total stockholders’ equity
attributable to Applied Digital Corporation |
|
118,488 |
|
|
|
59,517 |
|
Noncontrolling interest |
|
— |
|
|
|
10,162 |
|
Total stockholders' equity
including noncontrolling interest |
|
118,488 |
|
|
|
69,679 |
|
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY |
$ |
643,168 |
|
|
$ |
263,957 |
|
|
APPLIED DIGITAL CORPORATION AND
SUBSIDIARIESCondensed Consolidated Statements of
Operations (Unaudited) (In thousands, except per
share data) |
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
February 29, 2024 |
|
February 28, 2023 |
|
|
February 29, 2024 |
|
February 28, 2023 |
Revenue: |
|
|
|
|
|
|
|
|
Revenue |
|
40,284 |
|
|
|
10,054 |
|
|
|
|
110,993 |
|
|
|
23,139 |
|
Related party revenue |
|
3,064 |
|
|
|
4,036 |
|
|
|
|
10,883 |
|
|
|
10,215 |
|
Total revenue |
|
43,348 |
|
|
|
14,090 |
|
|
|
|
121,876 |
|
|
|
33,354 |
|
Costs and expenses: |
|
|
|
|
|
|
|
|
Cost of revenues (1) |
|
47,061 |
|
|
|
10,533 |
|
|
|
|
102,051 |
|
|
|
28,450 |
|
Selling, general and administrative (2) |
|
30,386 |
|
|
|
10,546 |
|
|
|
|
67,142 |
|
|
|
42,779 |
|
Loss on classification as held for sale |
|
21,723 |
|
|
|
— |
|
|
|
|
21,723 |
|
|
|
— |
|
Loss from legal settlement |
|
— |
|
|
|
— |
|
|
|
|
2,380 |
|
|
|
— |
|
Total costs and expenses |
|
99,170 |
|
|
|
21,079 |
|
|
|
|
193,296 |
|
|
|
71,229 |
|
Operating loss |
|
(55,822 |
) |
|
|
(6,989 |
) |
|
|
|
(71,420 |
) |
|
|
(37,875 |
) |
Interest expense, net (3) |
|
4,404 |
|
|
|
352 |
|
|
|
|
8,836 |
|
|
|
1,061 |
|
Loss on change in fair value of related party debt |
|
2,612 |
|
|
|
— |
|
|
|
|
2,612 |
|
|
|
— |
|
Loss on extinguishment of debt (4) |
|
— |
|
|
|
— |
|
|
|
|
2,353 |
|
|
|
94 |
|
Net loss before income tax expenses |
|
(62,838 |
) |
|
|
(7,341 |
) |
|
|
|
(85,221 |
) |
|
|
(39,030 |
) |
Income tax benefit |
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
(280 |
) |
Net loss |
|
(62,838 |
) |
|
|
(7,341 |
) |
|
|
|
(85,221 |
) |
|
|
(38,750 |
) |
Net loss attributable to noncontrolling interest |
|
— |
|
|
|
(316 |
) |
|
|
|
(397 |
) |
|
|
(577 |
) |
Net loss attributable to
Applied Digital Corporation |
$ |
(62,838 |
) |
|
$ |
(7,025 |
) |
|
|
$ |
(84,824 |
) |
|
$ |
(38,173 |
) |
|
|
|
|
|
|
|
|
|
Basic and diluted net loss per
share attributable to Applied Digital Corporation |
$ |
(0.52 |
) |
|
$ |
(0.07 |
) |
|
|
$ |
(0.77 |
) |
|
$ |
(0.41 |
) |
Basic and diluted weighted
average number of shares outstanding |
|
121,426,622 |
|
|
|
94,119,944 |
|
|
|
|
110,500,556 |
|
|
|
93,545,687 |
|
|
(1)
Includes cost of revenues attributable to related party
revenues of $2.5 million and $3.1 million for the three months
ended February 29, 2024 and February 28, 2023,
respectively, and $6.6 million and $8.8 million for the nine months
ended February 29, 2024 and February 28, 2023,
respectively. |
(2)
Includes related party selling, general and
administrative expense of $0.1 million and $0.5 million for the
three and nine months ended February 29, 2024. There was no
related party selling, general and administrative expense incurred
during the three and nine months ended February 28, 2023. |
(3)
Includes related party interest expense of $0.2 million
and $0.8 million for the three months ended and nine months ended
February 29, 2024, respectively. There was no related party
debt issued during three and nine months ended February 28,
2023 and as such, no interest expense was incurred related to
related party debt. |
(4)
Amounts included in the nine months ended
February 29, 2024 are related to the extinguishment of related
party debt. |
|
APPLIED DIGITAL CORPORATION AND
SUBSIDIARIESCondensed Consolidated Statements of
Cash Flows (Unaudited)(In thousands) |
|
|
Nine Months Ended |
|
February 29, 2024 |
|
February 28, 2023 |
CASH FLOW FROM
OPERATING ACTIVITIES |
|
|
|
Net loss |
$ |
(85,221 |
) |
|
$ |
(38,750 |
) |
Adjustments to reconcile net loss to net cash provided by operating
activities: |
|
|
|
Depreciation and amortization |
|
12,899 |
|
|
|
2,580 |
|
Stock-based compensation |
|
13,634 |
|
|
|
26,878 |
|
Lease expense |
|
41,473 |
|
|
|
2,296 |
|
Deferred income taxes |
|
— |
|
|
|
(280 |
) |
Loss on extinguishment of debt |
|
2,353 |
|
|
|
94 |
|
Amortization of debt issuance costs |
|
498 |
|
|
|
— |
|
Loss on classification as held for sale |
|
21,723 |
|
|
|
— |
|
Loss on change in fair value of related party debt |
|
2,612 |
|
|
|
— |
|
Changes in operating assets and liabilities: |
|
|
|
Accounts receivable |
|
(143 |
) |
|
|
145 |
|
Prepaid expenses and other current assets |
|
(4,115 |
) |
|
|
(266 |
) |
Customer deposits |
|
(150 |
) |
|
|
24,584 |
|
Related party customer deposits |
|
— |
|
|
|
2,262 |
|
Deferred revenue |
|
15,953 |
|
|
|
42,261 |
|
Related party deferred revenue |
|
(237 |
) |
|
|
1,481 |
|
Accounts payable |
|
55,464 |
|
|
|
(10,019 |
) |
Accrued liabilities |
|
8,191 |
|
|
|
1,562 |
|
Lease assets and liabilities |
|
(35,675 |
) |
|
|
(580 |
) |
Other assets |
|
(1,363 |
) |
|
|
(104 |
) |
CASH FLOW PROVIDED BY
OPERATING ACTIVITIES |
|
47,896 |
|
|
|
54,144 |
|
CASH FLOW FROM
INVESTING ACTIVITIES |
|
|
|
Purchases of property and equipment and other assets |
|
(86,996 |
) |
|
|
(96,214 |
) |
Finance lease prepayments |
|
(35,132 |
) |
|
|
— |
|
Purchases of investments |
|
(390 |
) |
|
|
(100 |
) |
CASH FLOW USED IN
INVESTING ACTIVITIES |
|
(122,518 |
) |
|
|
(96,314 |
) |
CASH FLOW FROM
FINANCING ACTIVITIES |
|
|
|
Repayment of finance leases |
|
(27,527 |
) |
|
|
(1,635 |
) |
Borrowings of long-term debt |
|
8,422 |
|
|
|
25,567 |
|
Borrowings of related party debt |
|
23,000 |
|
|
|
— |
|
Repayments of long-term debt |
|
(6,763 |
) |
|
|
(8,839 |
) |
Repayment of related party debt |
|
(45,500 |
) |
|
|
— |
|
Payment of deferred financing costs |
|
— |
|
|
|
(333 |
) |
Tax payments for restricted stock upon vesting |
|
(606 |
) |
|
|
(114 |
) |
Noncontrolling interest contributions |
|
— |
|
|
|
4,146 |
|
Proceeds from issuance of common stock, net of costs |
|
121,002 |
|
|
|
— |
|
CASH FLOW PROVIDED BY
FINANCING ACTIVITIES |
|
72,028 |
|
|
|
18,792 |
|
|
|
|
|
NET DECREASE IN CASH,
CASH EQUIVALENTS, AND RESTRICTED CASH |
|
(2,594 |
) |
|
|
(23,378 |
) |
CASH, CASH
EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD |
|
43,574 |
|
|
|
46,299 |
|
CASH, CASH
EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD |
$ |
40,980 |
|
|
$ |
22,921 |
|
|
|
|
|
SUPPLEMENTAL
DISCLOSURE OF CASH FLOW INFORMATION |
|
|
|
Interest paid |
$ |
9,121 |
|
|
$ |
1,118 |
|
SUPPLEMENTAL
DISCLOSURE OF NON-CASH ACTIVITIES |
|
|
|
Operating right-of-use assets obtained by lease obligation |
$ |
95,018 |
|
|
$ |
— |
|
Finance right-of-use assets obtained by lease obligation |
$ |
219,268 |
|
|
$ |
8,693 |
|
Property and equipment in accounts payable and accrued
liabilities |
$ |
41,100 |
|
|
$ |
9,384 |
|
Conversion of non-controlling interest |
$ |
9,765 |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
APPLIED DIGITAL CORPORATION AND
SUBSIDIARIESReconciliation of GAAP to Non-GAAP
Measures (Unaudited)(In thousands, except
percentage data) |
|
|
Three Months Ended |
|
|
Nine Months Ended |
$ in
thousands |
February 29, 2024 |
|
February 28, 2023 |
|
|
February 29, 2024 |
|
February 28, 2023 |
Adjusted operating
loss |
|
|
|
|
|
|
|
|
Operating loss (GAAP) |
$ |
(55,822 |
) |
|
$ |
(6,989 |
) |
|
|
$ |
(71,420 |
) |
|
$ |
(37,875 |
) |
Stock-based compensation |
|
3,194 |
|
|
|
4,480 |
|
|
|
|
13,634 |
|
|
|
26,878 |
|
Non-recurring professional service costs (a) |
|
2,355 |
|
|
|
365 |
|
|
|
|
3,442 |
|
|
|
1,437 |
|
Non-recurring research and development costs (b) |
|
— |
|
|
|
778 |
|
|
|
|
— |
|
|
|
893 |
|
Loss on classification as held for sale |
|
21,723 |
|
|
|
— |
|
|
|
|
21,723 |
|
|
|
— |
|
Accelerated depreciation and amortization (c) |
|
4,043 |
|
|
|
— |
|
|
|
|
4,220 |
|
|
|
— |
|
Loss on legal settlement |
|
— |
|
|
|
— |
|
|
|
|
2,380 |
|
|
|
— |
|
Other non-recurring costs (d) |
$ |
— |
|
|
$ |
349 |
|
|
|
$ |
— |
|
|
$ |
1,054 |
|
Adjusted operating loss (Non-GAAP) |
$ |
(24,507 |
) |
|
$ |
(1,017 |
) |
|
|
$ |
(26,021 |
) |
|
$ |
(7,613 |
) |
Adjusted operating margin |
(57 |
)% |
|
(7 |
)% |
|
|
(21 |
)% |
|
(23 |
)% |
|
|
|
|
|
|
|
|
|
Adjusted net
loss |
|
|
|
|
|
|
|
|
Net loss (GAAP) |
$ |
(62,838 |
) |
|
$ |
(7,341 |
) |
|
|
$ |
(85,221 |
) |
|
$ |
(38,750 |
) |
Stock-based compensation |
|
3,194 |
|
|
|
4,480 |
|
|
|
|
13,634 |
|
|
|
26,878 |
|
Non-recurring professional service costs (a) |
|
2,355 |
|
|
|
365 |
|
|
|
|
3,442 |
|
|
|
1,437 |
|
Non-recurring research and development costs (b) |
|
— |
|
|
|
778 |
|
|
|
|
— |
|
|
|
893 |
|
Loss on classification as held for sale |
|
21,723 |
|
|
|
— |
|
|
|
|
21,723 |
|
|
|
— |
|
Accelerated depreciation and amortization (c) |
|
4,043 |
|
|
|
— |
|
|
|
|
4,220 |
|
|
|
— |
|
Loss on change in fair value of related party debt |
|
2,612 |
|
|
|
— |
|
|
|
|
2,612 |
|
|
|
— |
|
Loss on extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
|
2,353 |
|
|
|
94 |
|
Loss on legal settlement |
|
— |
|
|
|
— |
|
|
|
|
2,380 |
|
|
|
— |
|
Other non-recurring costs (d) |
|
— |
|
|
|
317 |
|
|
|
|
— |
|
|
|
896 |
|
Adjusted net loss (Non-GAAP) |
$ |
(28,911 |
) |
|
$ |
(1,401 |
) |
|
|
$ |
(34,857 |
) |
|
$ |
(8,552 |
) |
Adjusted net loss per diluted
share (Non-GAAP) |
$ |
(0.24 |
) |
|
$ |
(0.01 |
) |
|
|
$ |
(0.32 |
) |
|
$ |
(0.09 |
) |
|
|
|
|
|
|
|
|
|
EBITDA and Adjusted
EBITDA |
|
|
|
|
|
|
|
|
Net loss (GAAP) |
$ |
(62,838 |
) |
|
$ |
(7,341 |
) |
|
|
$ |
(85,221 |
) |
|
$ |
(38,750 |
) |
Interest expense, net |
|
4,404 |
|
|
|
352 |
|
|
|
|
8,836 |
|
|
|
1,061 |
|
Income tax benefit |
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
(280 |
) |
Depreciation and amortization (c) |
|
26,204 |
|
|
|
1,927 |
|
|
|
|
47,664 |
|
|
|
4,631 |
|
EBITDA (Non-GAAP) |
$ |
(32,230 |
) |
|
$ |
(5,062 |
) |
|
|
$ |
(28,721 |
) |
|
$ |
(33,338 |
) |
Stock-based compensation |
|
3,194 |
|
|
|
4,480 |
|
|
|
|
13,634 |
|
|
|
26,878 |
|
Non-recurring professional service costs (a) |
|
2,355 |
|
|
|
365 |
|
|
|
|
3,442 |
|
|
|
1,437 |
|
Non-recurring research and development costs (b) |
|
— |
|
|
|
778 |
|
|
|
|
— |
|
|
|
893 |
|
Loss on classification as held for sale |
|
21,723 |
|
|
|
— |
|
|
|
|
21,723 |
|
|
|
— |
|
Loss on change in fair value of related party debt |
|
2,612 |
|
|
|
— |
|
|
|
|
2,612 |
|
|
|
— |
|
Loss on extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
|
2,353 |
|
|
|
94 |
|
Loss on legal settlement |
|
— |
|
|
|
— |
|
|
|
|
2,380 |
|
|
|
— |
|
Other non-recurring costs (d) |
|
— |
|
|
|
348 |
|
|
|
|
— |
|
|
|
960 |
|
Adjusted EBITDA (Non-GAAP) |
$ |
(2,346 |
) |
|
$ |
909 |
|
|
|
$ |
17,423 |
|
|
$ |
(3,076 |
) |
|
(1)
Non-recurring professional service costs represents legal,
accounting, and consulting services costs related to discrete
transactions and projects, as well as legal fees associated with
the Company’s defense of class action lawsuits and legal fees
related to matters with certain former employees. The Company does
not expect to incur these expenses on a regular basis. |
(2)
Non-recurring research and development costs represents
specific research and development activities related to the
Company’s business expansion that the Company does not expect to
incur on a regular basis. |
(3)
Accelerated depreciation and amortization represents the
acceleration of expense related to equipment that was abandoned by
the Company due to operational failure or other reasons.
Depreciation and amortization in this amount is included in
Depreciation and Amortization expense within the Company’s
calculation of EBITDA, and therefore is not added back as a
management adjustment in the Company’s calculation Adjusted
EBITDA. |
(4)
Other non-recurring costs represent expenses that are not
representative of the Company’s expected ongoing costs. |
|
Grafico Azioni Applied Digital (NASDAQ:APLD)
Storico
Da Mag 2024 a Giu 2024
Grafico Azioni Applied Digital (NASDAQ:APLD)
Storico
Da Giu 2023 a Giu 2024