Applied Digital delivered surging revenue in its latest quarter as its artificial-intelligence data center buildout began translating into business, offering investors a potential bright spot.

The company posted fiscal first-quarter revenue of $341.9 million on Wednesday, a 322% surge over the prior year, and an adjusted loss of 1 cent a share. Consensus analyst estimates called for revenue of $116.3 million and an adjusted loss of 29 cents a share, according to FactSet.

The company reported a net loss of $221 million after reporting a loss of $18 million last year. As of Aug. 31, the company said it had $3.7 billion in cash holdings and $6.4 billion in debt.

Shares of Applied Digital rose 2.4% in after-hours trading after falling 6% to $23.81 in the regular session. The stock is down 15% over the last 52 weeks and 2.9% this year, pacing toward its worst annual performance since 2022, according to Dow Jones Market Data.

Applied Digital, an AI data-center developer and operator, builds and oversees facilities for AI and high-performance computing. It then leases that computing capacity to cloud-computing companies and other hyperscalers, including CoreWeave.

Applied Digital's stock has become a bet on the company's ability to capitalize on the rising demand for AI infrastructure. It has expanded its pipeline of data-center projects and signed billions of dollars in long-term leases, but its aggressive buildout has brought mounting construction costs, heavy financing needs, and continued losses.

The company spent $2.9 billion on property, equipment, and other assets in fiscal 2026, with about $2.8 billion of that going toward purchases of property. It spent $681 million on property purchases in fiscal 2025.

Investors have pulled back on Applied Digital as its buildout costs have raised concerns about whether the company can capitalize on growing demand for AI infrastructure.

The company has assumed billions of dollars in debt to fund new projects while continuing to post losses, as investors judged how quickly its growing base of long-term leases could turn into profits.

Its latest results offered evidence the buildout is beginning to produce recurring revenue. Base rent from its high-performance computing business rose to $65.8 million from $44.1 million in its last quarter as Applied Digital brought more capacity online.

Applied Digital called its prior quarter a "defining" moment for the company as it posted a 407% jump in revenue.

CEO Wes Cummins said at the time the company was "still in the early innings of what we believe will likely be the largest buildout of critical infrastructure in modern economic history."