Applied Digital Corporation

Good afternoon and welcome to your ApplyDigital's Fiscal Second Quarter 2026 conference call. My name is Konstantin and I will be your operator for today. Before this call, ApplyDigital issued its financial results for the Fiscal Second Quarter ended November 30, 2025, in a press release, a copy of which has been furnished in a report on a Form 8K filed with the Securities and Exchange Commission, or 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, Saidal Momand. Following the remarks, we will open the call for questions. Before we begin, Matt Glover from Gateme Group will make a brief introductory statement. Mr. Glover, you may begin.

Thank you, Operator. Hello, everyone, and welcome to Applied Digital's fiscal second quarter 2020. Before management begins formal remarks, we'd like to remind everyone that some statements we're making today may be considered forward-looking statements 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 and events to differ materially from those described in the forward-looking statements. For more detailed risks, uncertainties, and assumptions relating to our forward-looking statements, please see the disclosures and earnings release and public filings made with the SEC. We disclaim any obligation or undertaking are made except as required by law. We also discuss non-GAAP financial metrics and encourage you to read our disclosures in the reconciliation tables to the applicable GAAP measures and earnings release carefully as you consider these metrics. We refer you to our filings of the SEC for detailed disclosures and descriptions of 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 You can access Applied Digital's SEC filing for free by visiting the SEC website at www.sec.gov. I'd like to remind everyone that this call is being recorded. It will be made available for replay via 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 Cummings. Wes?

Thanks, Matt, and good afternoon, everyone. Thank you for joining our fiscal second quarter 2026 conference call. I'd like to begin by thanking our employees for their dedication to delivering high-performance, sustainably engineered infrastructure for AI, cloud, and blockchain workloads. Their execution and commitment continue to be foundational to our success. This quarter marks several important milestones across our HPC data center and hosting business. Polaris Forge One reached ready-for-service, energizing 100 megawatts on schedule and completing the first of three contracted buildings. The remainder of this AI factory campus is expected to be completed by the end of 2027 and will host 400 megawatts for CoreWeave, representing approximately $11 billion in prospective lease revenue over approximately 15 years. We also announced a roughly $5 billion 15-year lease with a US-based investment-grade hyperscaler for 200 megawatts at Polaris Forge II. This is a $3 billion project near Harwood, North Dakota that is advancing on schedule with initial capacity expected in 2026 and full build-out in 2027. Together, these agreements represent 600 megawatts of lease capacity and approximately $16 billion in prospective lease revenue across our North Dakota campuses. Having secured two hyperscale leases in the region, inbound demand has increased meaningfully. As a result, we are in advanced discussions with another investment-grade hyperscaler across multiple regions, including additional locations in the Dakotas and select southern U.S. markets. While there can be no assurance of future contracts, we believe we are well positioned to begin construction of additional campuses in the near term. Hyperscalers are competing aggressively to secure sites that can support massive AI demand, responding to data highlighting significant shortfalls in global power capacity. Many are being asked to commit capital to 30-year power plant developments, meaning energy may take years to come online and could cost more than anticipated. Beyond the immediate rush, AI infrastructure is ultimately a cost of capital business where every input matters. In this context, we chose the Dakotas because we believe they provide a durable competitive advantage with low-cost deployment energy in climate, ample land for expansion of existing sites, and potential for future large-scale super sites that could align with regional energy developments, making applied digital sites not only immediately valuable, but we believe also more efficient and cost-effective over the long term compared with other regions in the U.S. and globally. Building on this advantage, we have significantly evolved our construction and design capabilities. Our current data center designs are modular and highly efficient, allowing us to run numerous concrete plants simultaneously and leverage prefabricated components delivered by 18-wheelers. The approach reduces construction timelines and lowers overall costs. We've expanded the footprint and flexibility of our building's design to allow for different GPU and ASIC chip architectures and networking infrastructure to support multipurpose AI use cases and traditional cloud workloads. While AI is driving significant demand, cloud computing continues to grow and increasingly competes for data center capacity. Our facilities are purpose-built to support training, inference, and traditional cloud workloads intended to give hyperscalers maximum flexibility over the life of the asset. Looking ahead, we expect to maintain a meaningful competitive advantage in the Dakotas and intend to announce additional locations in other advantaged regions. With that, I'll turn the call over to our CFO, Sadol Momon, for a detailed review of our financials. Sadol?

Thanks, Wes, and good afternoon, everyone. This quarter represents a major inflection point for Applied Digital. After two years of construction and over $1 billion invested in our first 100 megawatt data center, we have now begun to generate lease revenues. We expect lease revenues to ramp over the next quarter, and it's important to note that we currently have two different campuses under construction simultaneously, representing 600 megawatts. These buildings are expected to come online over the course of calendar 2026 and 2027, where we anticipate meaningful revenue growth over the coming 18 to 24 months. This does not include any additional campuses currently under advanced discussions with customers, which would be layered into these numbers according to their respective design and build timelines. From a high-level finance perspective, we have agreements in place with top-tier financial institutions that allow us to execute this repeatable and capital-efficient framework. The first step of this process is to draw on our development loan facility with Macquarie Equipment Capital, which allows us to fund pre-lease construction for new sites. Subsequent to the second first quarter end, we made our first draw under this $100 million facility. The second step, following a mutually agreed upon executed lease with an investment grade hyperscaler, is to access the Macquarie Asset Management's $5 billion preferred equity facility. To date, we have drawn $900 million from this facility to support our Polaris Forge 1 and 2 campuses. We expect a similar financial structure will be used going forward for future development projects. This multi-layered financing framework allows Applied Digital to leverage third-party capital for a majority of the upfront investment while retaining majority ownership of each site, providing financial flexibility and reducing reliance on public capital markets. On the debt front this quarter, we completed a $2.35 billion private offering of our nine-and-a-quarter senior secured notes due 2030 to finance the first two of the three buildings at our Polaris Forge One site, supporting the core releases, allowing us to refinance existing debt. Note, project-level debt typically carries higher interest rates initially as it finances the riskier portion of development, but once the buildings are operational, our goal is to refinance at lower rates. Additionally, our team is actively exploring and working on options to reduce the cost of debt for the third building, ensuring we continue to optimize our capital structure. Now let's turn to the quarter. Revenues for the fiscal second quarter of fiscal 26 were $126.6 million, up 250% from $36.2 million in the prior year. The increase was primarily due to a $73 million of revenue generated from the 10-out fit-out services associated with our HPC hosting business, along with $12 million of recognized revenue in connection with the commencement of the first CoreWeave lease at Polaris Forge 1, reflecting partial quarter lease revenue. On a cash basis for the leases, revenues were approximately $8 million. The difference between cash received and the revenue recognized reflects ASC 842 lease accounting, which requires lease revenue to be recognized on a straight line basis over 15 years. We will aim to provide clarity on this difference on the annual basis going forward. Applied Digital's data center hosting segment, which operates 286 megawatts of customer ASICs across two North Dakota facilities, had an exceptionally strong quarter, contributing $41.6 million of revenue, up 15% compared to the prior year. This growth was primarily driven by increased capacity online across the company's hosting facilities. We are very pleased with this business, which generated roughly $16 million in segment operating profit in just one quarter on a $131 million asset base. Cost of revenues in total were $100.6 million compared to $22.7 million in the prior quarter. Approximately $69.5 million of the increase in the cost of revenue was associated with the tenant fit-out services for our HPC hosting business, while the remaining increase was associated with our data center hosting business and other expenses directly attributable to generating revenue. SG&A was $57 million compared to $26 million. This increase was due to an increase of $23.8 million in stock-based comp due to accelerated vesting of certain employee stock awards, $4.7 million in professional service expenses, primarily related to an increase in legal services, and $1.2 million in personnel expense for employee cost and other costs attributable to supporting the growth of the business. Interest expense was $11.5 million compared to $2.9 million, while net loss was $31.2 million, or 11 cents per share. On an adjusted basis, adjusted net income was positive $100,000 or zero cents per share. Adjusted EBITDA for the quarter totaled $20.2 billion. From a balance sheet perspective, Applied Digital is exceptionally well-positioned. We ended the fiscal with the second fiscal quarter with $2.3 billion in cash, cash equivalents, and restricted cash versus $2.6 billion in debt, most of which does not mature until 2030, and approximately $2.1 billion in total equities. Note these figures do not include the $382.5 million in proceeds from financing completed subsequent to the quarter end. Our goal is to maintain one of the strongest balance sheets in the industry throughout the majority of the construction phases, intentionally holding a robust liquidity position to preserve a strong credit profile while enabling additional investments in equipment and new sites, then reassessing as buildings come online as our cash flow increases. With that, I'll turn over the call to Wes for closing remarks. Thank you.

Thank you, Sadal. Applied Digital is executing in a market defined by extraordinary hyperscaler investment, now exceeding $400 billion annually. With our first two hyperscalers under contract for 600 megawatts and additional sites and advanced discussions, we are well positioned to scale rapidly. We now expect to surpass our long-term goal of $1 billion in NOI within five years. The Dakota campuses are expected to provide a durable strategic advantage through low-cost energy, natural cooling, and a supportive regulatory environment. We remain committed to responsible development, strong community partnerships, and environmental stewardship. We continue to invest ahead of the curve. This quarter, we led and invested $15 million in a $25 million funding round for Corentis, supporting advanced liquid cooling solutions for high-density AI workloads. We are also working with utilities and strategic partners, including Babcock and Wilcox Enterprises, to explore ways to add power to the grid without increasing costs to our customers. These initiatives reinforce our leadership in next-generation data center design, responsible grid management, and a long-term shareholder value creation. We plan to continue advancing our thought leadership at the forefront of data center technology and deepening our influence across the broader ecosystem. I'm also proud to announce the launch of Applied Digital CARES, a community initiative funding grants that support education, health, innovation, and local development in the regions where we operate. Through this initiative, we aim to improve the standard of living in these focused communities because our success depends on theirs. Finally, as noted earlier, I want to expand on the board's decision to spin out Applied Digital Cloud. We've entered a non-binding letter of intent to combine Applied Digital Cloud with ExoBionics to form Chronoscale, a dedicated GPU accelerated compute platform for demanding AI workloads. This transition separates our cloud platform from our data center business intended to allow each to scale independently with greater strategic and capital flexibility. ChronoScale is set up to leverage the proven applied digital cloud platform among the first to deploy NVIDIA H100 GPUs at scale. On an anticipated closing in the first half of 2026, Applied Digital is expected to own over 80% of ChronoScale. Today, the cloud business generates roughly generates over 60 million in trailing 12-month revenue with 313 million in assets. We believe spinning off our cloud business best positions us to serve the accelerating AI market while enhancing long-term shareholder value. With that, operator, we'll open the call for questions.

Ladies and gentlemen, we will now begin the question and answer session. If you have a question, please press star followed by the number one on your touchstone phone. You will hear a prompt that your hand has been raised. If you would like to withdraw from the polling process, please press star then the number two. If you are using a speakerphone, please make sure to lift your handset before pressing any keys. Your first question comes from the line of Neat Gals from B. Reilly Securities. Please go ahead.

Thanks, operator. Hey, guys. Congrats on all the progress. My first question was just, you know, I was hoping to get a sense for your growth appetite in the cloud business. Good to see the announcement there for Chronoscale. You know, should we expect the Applied platform to be a host for any future GPU purchases, or how could Applied ultimately help attract incremental customers in, you know, for Chronoscale? Thanks, Mark.

Thanks, Nick. We've had a lot of discussions around that, so I think one of the key advantages the chronoscale will have is the relationship with Applied Digital and access to large-scale data center facilities. Deploying the accelerated compute, whether it be GPUs or TPUs or LPUs is part of the equation, but having access to large-scale data center facilities to actually make those deployments is a bigger part of the equation right now. And I think that's going to give that platform an advantage, having the relationship with Applied Digital. We've had some of those discussions. We don't really want to get into how that will work in the future, but I do think that's a big advantage for the cloud business as it spins out.

Got it. Don't appreciate that was my second one was just, you know, you signed an agreement for a limited notice to proceed with Babcock and Wilcox. And I was just wondering if you could touch on the opportunity there. What kind of optionality does this really give you going forward? And what should we be looking for in the upcoming contract release?

So for us, the BW solution is a very unique solution and an exciting solution in the market because it uses older technology or an older process which has been proven out for 100 plus years. It's using steam turbines. Think of coal plant boilers that were using natural gas. That company has actually made a lot of coal to natural gas conversions. over the past decade plus. And what it allows us to do is go to market earlier. If you get in lines for the natural gas, traditional natural gas turbine right now, if we put an order in today, we're probably not getting delivery until 2031, 2032 for that equipment. We need power earlier than that. We are working with our utility partners, specifically now in the Dakotas, but expect to in other states as well. The initial reaction from those utilities has been overwhelmingly positive and really interested in the solution that the utility is Any utility in the country knows who BW is. The company's been around for a long time, very good reputation. And for us to be able to bring a product forward, you know, three, four plus years to be able to generate power in the near term is a big advantage for those utilities and for us. And I think you should expect to see more information about that in the first quarter as we proceed with BW. and an actual schedule for build on that equipment. But it provides a really good option for Applied Digital to expand its current campuses and future campuses faster than we would be able to otherwise.

Got it. Hey, Wes, appreciate all the detail. Keep up the good work.

Thanks, Nick. Next question comes from the line of from Roth Capital. Please go ahead.

Hey, guys. Yeah, good afternoon. Thanks for taking my question, and congrats on the progress. Two, if I may, Wes, can you just talk generally about the landscape for leases and how pricing may have changed over the last six months? Like, is it improving, staying the same, going down? And then the second question, can you just talk a little bit about the pre-lease financing? I appreciate what it's actually doing, but, like, what does that say about your confidence when you're progressing on sites where you don't have signed leases, just any kind of commentary and context would be great. Thanks.

Sure. So I'll start with pricing and then I'll keep it specifically to us. I don't want to speak for the market at large, but I would say generally pricing has been stable to slightly better over the past six months. The demand profile for the past six months has been extraordinarily robust. I always want to expand a little bit on this with contracting. There's the headline price that you'll see in contracts and a calculated yield, which is using an estimated cost to build. That's one aspect of it. What I would say, though, that's as important or even more important is we're getting more favorable terms in other aspects of the contract that we focus on very acutely. For things like cancellation, transferability, a lot of the things that make these contracts for us, you know, much more rock solid over that 15-year timeframe. We're getting a lot more favorable treatment in those aspects. As an example, you know, our current contracts are really non-cancelable for 15 years. The customer can cancel for convenience. However, they owe us the 15 years of payments if they do. So that's typically referred to as a make-hole or a cancellation in the contract. So we've been able to get that 100% make-hole transferability that doesn't allow them to transfer to a credit rating that's either equal or higher. There's a lot of things that go into the contracting. So I would just say in general that the contracting environment has gotten more favorable over the past six months. And then on the the Macquarie equipment facility and us announcing that, I think you should think back to what we did for our facility in Harwood, North Dakota. We did something very similar. And at the time I spoke about that as well as, we will go forward with groundwork, breaking ground, getting the project moving when we have a high degree of confidence that we're going to sign a lease at a new campus or new campuses. And that's that facility. We use that same style facility. Now we've made that facility effectively at Evergreen so that we can continue to draw and pay it back. But we used that in Harwood. We paid that back with the draw on Macquarie Asset Management. We've now drawn down again. We've purchased some land and some other equipment. We'll start construction on at least one new campus by the end of January. And that's because we have a high degree of confidence that we're going to sign a lease with a new customer that is different. And we've set investment grade hyperscaler. It's different than the original one we signed in Harwood. And that's the goal for us. You know, Darren, we have a lot of momentum, so we've talked a lot about this before, where we're qualified with most of the investment-grade hyperscalers. We're really focused on six companies total here. And so we want to add new locations, and we want to add new customers. So we diversify both in location and by customer, and we expect to have a lot of success on that in 2021. in 2026 and with what we're doing and what you're seeing the actions are now, you should expect that we think it's going to be in very early 2026. Great. Appreciate the insight, Wes. Thanks.

Absolutely. The next question comes from the line of Rob Brown from Lake Street Capital Markets. Please go ahead.

Good afternoon. Congratulations as well on all the progress. Just Back to the chronoscale spinout, I think you said midyear for kind of closing. What's the – give us a sense of what steps have to happen between now and then in terms of getting finalized agreement and a closing step? What sort of has to happen here? Sure.

So, it technically will be a merger, Rob. And so, we'll get to a definitive, you know, later this month or early in February. And then there will just be a process for a shareholder vote to complete the merger. You know, I think in the first half of 26 is the expectation. I think if I were, you know, handicapping it on the very, very early side in March, I would expect kind of the April-May timeframe as we go forward with that.

Okay, great. And then as you kind of think about that business and the growth possibly there, I think instead of $60 million trailing or $75 million, I think it's all said sort of perspective, what's sort of the growth opportunity? Is there additional capacity that can get leased out as a standalone business, or do you expect some growth in capacity as well, but just a sense of the growth opportunity there?

Yeah, so just for context on this, Rob, when we announced back in April, we put that into discontinued ops. We're seeking strategic alternatives. We evaluated a lot of alternatives. But while we were evaluating those alternatives, I think that market changed pretty significantly. And what we're seeing is a big opportunity in the compute side of the market, obviously the data center side as well, but the compute side of the market, you're seeing a lot of deals happen over the past, you know, three or four months in that part of the market. We're involved in, in with a lot of those, you know, counterparties and discussions and have been, and we think there's a really large opportunity for our cloud business as we spin it out into chronoscale to, to get, you know, some of those types of contracts, And we, you know, working with us, we think there's a really unique relationship there where we can get data center capacity to be able to deploy, you know, significant scale for those style of contracts with those customers. And so we think this is the absolute best path for value creation for our shareholders to let this, you know, company spin out and capture that opportunity and, you know, raise its own capital and then get on its own growth trajectory, which, you know, we just haven't focused on for the past, oh, eight months. So we think there's a huge opportunity there and you can see the stuff that's going on in the market and we're really well positioned to capture some of those opportunities. Okay, great. Thank you. I'll turn it over. Thanks, Rob.

Next question comes from the line of Mike Grondahl from Northland Securities. Please go ahead.

Hey, guys. Thank you. You've mentioned a couple times advanced discussions. Can you talk a little bit about how many sites you're having – advanced discussions about like how many megawatts, just so we can get a feel, kind of a sense of the breath that you're talking about?

Sure. I think we've talked about two or three sites. So I'll tell you, we're in advanced discussion on three sites and 900 megawatts.

Great. Three sites and 900 megawatts. And then Wes, how are you thinking about the pipeline today? How would you characterize that pipeline?

The pipeline remains robust. I will say, Mike, when I think about the business, and it's been like this for the past few months, you know, I'm thinking less about the demand side of the equation. And I talked about this a lot on the last call, which is, you know, our ability to scale. Our ability to scale across multiple sites and do construction across multiple sites and how many sites can we do construction across. And the team spent a lot of time in 2025 and will continue in 2026 working on our ability to scale and, you know, execute these projects at the size that we're doing across multiple sites. So, it's less on the demand side because that's, you know, not been really the issue for us or really, I think, the issue for the industry. We'll focus more on how much can we do and how much can we build from a supply chain perspective, from a personnel perspective on an annualized basis. And so, I don't think demand is going to be the limiter for us, but I want to make sure, you know, we always want to make sure that we're delivering on time and on budget for our customers. And I don't want to go too far out. We haven't hit that limit yet. But it's the piece that I think about a lot, and we internally think about a lot, is what is the limit for us on an annual basis? It's a large number, but that's really more the limiting factor for us and not, you know, what the demand picture looks like.

Great. Hey, thanks a lot.

Absolutely. Thanks, Mike.

The next question comes from the line of George Sutton from Craig Helen. Please go ahead.

Thank you. Wes, you mentioned having been qualified by a few of the investment-grade hyperscalers. Can you just talk about what that means when we talk about being in advanced discussions? I mean, how much more simplicity of getting something across the finish line is there once you've gone through that process versus, you know, hypothetically someone new in the market?

Yeah, so what I would say generally, and I'm going to only be able to reference our experience, so getting onboarded, getting to the point where you, you know, you sign a master agreement that governs, you know, typically work orders or service orders you'll sign underneath of that can be anywhere from, you know, on the low end, three months to on the high end, you know, nine months to a year. And so we've been through the process there for most of these hyperscalers. So, you know, there's the six that we target, which are the five investment-grade hyperscalers, and then the core weave. So we're through, out of those six, we're through that process with five of those. And so I think we're in a really good position. And so if we've already been through that process, doing a new building even if it's, you know, a new building on the same campus or an expansion in a current building or doing even a new campus if you're through that with one of those hyperscalers is a much shortened timeframe, abbreviated timeframe to get to that, you know, actual contract versus starting from scratch.

Gotcha. So, I want to put a couple of things together. And if you can help me, you were on CNBC the other day mentioned, by the way, movie star quality experience, frankly. But you mentioned you had done $16 billion of deals in 25 and that you would anticipate doing that or potentially better in 26. And I want to dovetail that with what you just said on we're late stage with three sites and 900 megawatts. Am I kind of putting these things all together correctly?

Yeah, I think that's correct. What I would just add to that on the, George, on the 900 megawatts, you know, I don't want to set the expectation that all of that is done at the same time. You know, that could be, you know, one at a time. It could be none. You know, we've been through enough of this. You know, George, you've been through this with us as we've gone through the last few years. Nothing is done until it's done. That's just what we're working through right now. But that's, those two going together, I think, you know, you're reading that correctly.

All right. Perfect. Thank you. Absolutely.

Next question comes from the line of John Todaro from Edom and Company.

Please go ahead.

Hey, thanks for taking my question, and congrats on the quarter. Wes, you spent a good amount of time talking about how I guess supply and execution is a little bit more of the difficulty part than demand. I think you ultimately ended ahead of schedule on that first build for CoreWeave. Can you just walk us through maybe what you learned from that execution and give us confidence in how you'd be able to continue to execute on those builds on the development side, and then I will follow up.

Yeah, so we learned a lot going through that process on that first building, and we've made a lot of refinements. Typically, John, I think you've probably heard me talk about this before. So for us, one of the things I think differentiates us in the market is we started down this path back in 2022. We've stubbed our toe in a lot of different ways. through the years, luckily we did most of that at a very small scale. But we had a lot of lessons on that first building and you can see that reflected in design change and then construction change and how we operate all the way through our supply chain and standardizing, you know, lower amount of SKUs, lower amount of suppliers, all of these things that streamline the process that we do to build these facilities. And so we feel like we have a really good handle on our construction timelines. There's always things that can, you know, cause a problem that are out of our control on construction. You know, one of the things I always, you know, worry about is weather. But we've built, I think, this is our fourth year in a row building in North Dakota in the wintertime. So we're pretty accustomed to that as well. But we have, you know, we went back securing supply chain, you know, well over a year ago, 18 months plus ago, and we thought we were really forward thinking on, you know, locking in, you know, 600, 700 megawatts of MEP per year that we have for us. Now we're working to expand that. You know, that fits what we're doing right now, but I think that needs to go larger for us. But we feel good about our processes we have in place and kind of the maturation of the construction and development group. versus what we did on building one. I'm proud. I'm really proud for the entire team that we delivered that on time and on budget for our customer. But we have to continue to do that. We feel really good about where we are for the core building that we're expecting to deliver in the middle part of this year. And the building in Harwood, we're expecting to deliver shortly after that. And then the next two buildings after that, both in Ellendale and in Harwood. So we're feeling really good about where we are on schedule. But it's about, you know, the fact that we have streamlined this and we're on what I call our fourth generation design has really helped us in that. you know, simplifying the process and streamlining the process and being one of the companies that does deliver on time.

That's great. Thanks for that. And then just a quick follow-up. I think you've mentioned in the past getting calls from entities with sort of stranded power, and it sounded like there might be a little bit more pockets of available power out there than some of us in the industry had initially thought. Could you just maybe frame that up? Is there still additional kind of pockets to acquire more fairly near-term power? And maybe talk to your color on that.

Yeah, we keep finding more opportunities, more and more opportunities. Everything we're in process with right now is organic. So we have a large amount in flight that is organic. But we continue to see opportunities, you know, third-party opportunities. We continue to evaluate those opportunities. And some of those, you know, really for us it's You know, could it be in a different, you know, geographic market for us that is a really attractive market? But we continue to look at that. But everything we're doing right now is organic, but we see those, you know, I would say daily, weekly at least, but typically multiple times in a week.

Great. Thanks for that, guys, and congrats again. Thanks, Sean.

Your last question comes from the line of Michael Donovan from CompassPoint. Please go ahead.

Hi, Wes and Seidel. Congrats on the quarter. Following up on Mike's pipeline question, can you touch upon expansion opportunities at PF1 and PF2? Do you still have confidence in those reaching 1.4 gigawatts and 1 gigawatt, respectively, and that by follow-up?

Yes. Yeah, so every one of our campuses, I think this is an important point. Every one of our campuses has the potential to go to at least a gigawatt and some significantly beyond a gigawatt. But when we think about our goals inside the company, we have two campuses now that can each go to a gigawatt or more. So we have that pipeline in the future for ourselves. And then we're working on you know three three additional campuses we're working on a lot more than that but the things we're in advanced stage on three three more campuses uh each one of them can can scale to two gigawatt capacity so for us if if we put those in place those contracts in place we have different customers on those campuses We have a view and a pretty clear path to, whether it's by 2030 or 2031 or 2032, to growing our capacity to five gigawatts if we don't add another campus after that. We would expect that we would, but it puts a really good growth path out for the company just having these campuses in place that, you know, just getting the two gigawatts, if we were talking about this a year ago, would be, you know, monumental for us. But if we can expand to five campuses and have a clear path to five gigawatts plus of capacity, you know, over the next five years, that's a really great position for the . But all of those campuses have that expansion potential.

Great. I appreciate that. And with the discussions around NVIDIA this week with, liquid cooling for VR Rubens. Can you discuss a bit on what makes Corentis a competitive solution?

So Corentis is a really interesting, you can go and look at their technology. They had a very nice announcement with Microsoft, I think a couple of months ago. What we like about it is Corentis has a Coldplay technology that I that I liken to semiconductor and then module. A lot of semiconductors are built into modules. So they have the technology that I would classify in this case like semiconductor, which is a specially designed patterned cold plate that is dependent on each chip, you know, individually. So whether it's B200, B300, Ruben, whatever it might be, they map that chip. They map the heat points of that chip. They design the cold plate with a lot of microchannels through it. And then it goes into a full cold plate, and it sits on top right now. But this technology is designed to go inside the semiconductor packaging in the future and then actually inside the manufacturing process in the epi towards semiconductors and the goal for this technology and a lot of this is proven out for them is that you can use if a chip goes say it's using one kilowatt dial but the next generation ship uses three kilowatts or five kilowatts this technology can use the same amount of liquid to chill chips as they go up now there's a point where that breaks and there's a change where they need more liquid but From a data center operator perspective, when having that efficiency inside is always great for our customers. But to be able to deliver the same amount of liquid on the data center side for a chip that's 3x the power density of what we're currently running really helps us future-proof our infrastructure. And so we're really excited about that technology.

Thank you. There are no further questions. There are no further questions at this time. I'd like to turn the call back to Wes Cummings for closing comments. Sir, please go ahead.

Thanks everyone for joining us for our Q2 earnings call. I appreciate all of the support and look forward to speaking to you in April. Thanks.

Ladies and gentlemen, this concludes today's conference call. Thank you very much for your participation. You may now disconnect.