Applied Digital Corporation

Good afternoon and welcome to Applied Digital's fiscal fourth quarter 2024 conference call. My name is Shamali and I will be your operator today. Before this call, Applied Digital issued its financial results for the fiscal fourth quarter ended May 31st, 2024 in a press release, a copy of which will be furnished in a report on a Form 8K filed with the SEC and will be available in the Investor Relations section of the company's website. Joining us on today's call are Applied Digital's Chairman and CEO, Wes Cummins, and CFO, David Wrench. Following the remarks, we will open the call for questions. Before we begin, Matt Glover from Gateway Group will make a brief introductory statement. Mr. Glover, please proceed.

Great. Thank you, Shamali. Good afternoon, everyone, and welcome to Applied Digital's fourth quarter 2024 conference call. Before management begins their formal remarks, we'd like to remind everyone that some statements we're making today may be considered forward-looking under securities laws and involve a number of risks and uncertainties. As a result, we caution you that there are a number of factors, many of which are beyond our control, which could cause actual results to differ materially from those described in the forward-looking statements. For more detailed risks, uncertainties, assumptions relating to our forward-looking filings made with the Securities and Exchange Commission, we disclaim any obligation or any undertaking to update forward-looking statements to reflect circumstances or events that occur after the date, except as required by law. We will also discuss non-GAAP financial metrics and encourage you to read our disclosures in the reconciliation tables, the applicable GAAP measures, and earnings and release, which can be found on the investor relations section of our website, carefully as you consider these metrics. We refer you to our filings with the SEC for detailed disclosures and descriptions for our business, as well as uncertainties and other variable circumstances, including but not limited to risks and uncertainties identified under the caption risk factors in our annual report on Form 10-K, our quarterly report on Form 10-Q. You may get Applied Digital Security and Exchange Commission filings for free by visiting the SEC website at www.sec.gov. I would like to remind everyone that this call is being recorded and will be made available for replay via a link available in the investor relations section of Applied Digital's website. Now I'd like to turn the call over to Applied Digital's Chairman and CEO, Wes Cummins. Wes.

Thanks, Matt, and good afternoon, everyone. Thank you for joining our fiscal fourth quarter 2024 conference call. I want to start by expressing gratitude to our employees for their ongoing hard work and service in supporting our mission of providing purpose-built infrastructure to the rapidly growing high-performance computing industry. Before turning the call over to our CFO, David Wrench, for a detailed review of our financial results, I'd like to share some recent developments across our business. During the quarter, we faced several challenges that impacted our financial performance due to the facility power outages in our data center hosting business. Despite these short-term setbacks, the company has made significant progress with our key growth initiatives, including the development of our cloud services business and the construction of our purpose-built 100-megawatt HPC data center in Allendale. As previously announced, we executed an LOI with a U.S.-based hyperscaler for 400 megawatts at our Allendale campus, inclusive of our current 100-megawatt facility and two forthcoming buildings. Now we'll provide an update on each of our business units. Let's begin by discussing our data center hosting business. Our 106 megawatt Jamestown facility has consistently met expectations operating at full capacity with uninterrupted uptime throughout the quarter. This achievement marks the seventh consecutive quarter of full capacity operation for this facility. While we are pleased with Jamestown's performance, we encounter challenges at other facilities. As previously disclosed, our 180 megawatt Allendale facility in North Dakota experienced a power outage starting in January. which we determined was caused by transformer failures. By the end of the fourth quarter, we had successfully replaced the transformers and related components with equipment from industry leading North American manufacturers. As a result of the transformers being replaced, we now have 286 megawatts of data center hosting capacity for our blockchain clients across our two fully contracted locations in North Dakota. Let's move on to our cloud services business, which provides high performance computing power for AI applications. This segment continues to experience growth as we advance in fulfilling our existing contracts and exploring new opportunities in our pipeline. As of the end of the fourth quarter, we had four clusters online and we brought another two clusters online in the first quarter of 2025. Lastly, let me provide an update on our HPC data centers. We currently have 400 megawatts of capacity under development across North Dakota. This is in addition to the 7.5 megawatts of IT capacity at our HPC facility in Jamestown, which due to its proximity to Ellendale should allow for a low latency interconnected extended campus in North Dakota. During the quarter, we continued to make significant strides in the construction of our first proprietary 100 megawatt high performance computing facility in Ellendale, North Dakota. This state of the art facility will feature cost effective, highly efficient liquid cooled infrastructure specifically designed for the most demanding HPC applications. We have made substantial progress in the construction of the 369,000 square foot facility. I encourage you to visit our new website for some recent images of the facility. As previously mentioned, we have entered into exclusivity and executed a letter of intent with a US-based hyperscaler for a 400 megawatt capacity lease. We believe the hyperscaler has completed their technical and site due diligence on the location and are now working to finalize the details of the lease. This will be followed by finalizing the project level financing for this investment grade tenant. We are focused on finalizing the lease and project financing for Ellendale campus, and we have started marketing three additional campuses totaling 1.4 gigawatts. All of these campuses have power available in 2026. In summary, we are encouraged by the positive trends we are witnessing across our business and remain confident in our growth trajectory. We're excited about the numerous potential catalysts on the horizon and are committed to strategically allocating our capital to achieve the highest risk-adjusted returns and maximize shareholder value. With that, I will now turn the call over to our CFO, David Wrench, to walk you through our financials and provide an update on guidance. David?