Applied Digital Corporation stock research
FY2026 Q2
Applied Digital (APLD) Gross Margin — Quarter Ended Nov 30, 2025
Gross margin improved compared to the immediately preceding quarter but weakened compared to the same quarter one year earlier. Revenue and gross profit increased both sequentially and year-over-year, while cost of revenue grew at a different pace relative to revenue across these periods.
Gross margin takeaway
Quarter ended Nov 30, 2025 · FY2026 Q2
Gross margin improved compared to the immediately preceding quarter but weakened compared to the same quarter one year earlier. Revenue and gross profit increased both sequentially and year-over-year, while cost of revenue grew at a different pace relative to revenue across these periods.
- The sequential improvement in gross margin was driven by a shift in the relationship between cost of revenue and revenue, with revenue growing more than cost of revenue compared to the prior quarter.
- Compared to the prior quarter, gross profit and revenue both increased, and gross margin was higher. Compared to the same quarter last year, gross margin was lower despite higher revenue and gross profit, reflecting that cost of revenue increased more than revenue on a relative basis.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
20.6%
Gross profit
$26.0M
Revenue
$126.6M
Cost of revenue
$100.6M
Quarter-over-quarter change
+7.2 pts
Year-over-year change
-16.8 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Feb 28, 2025 | $52.9M | $3.8M | $49.1M | 7.1% |
| May 31, 2025 | -$33.3M | $27.8M | -$61.1M | -83.5% |
| Aug 31, 2025 | $64.2M | $8.6M | $55.6M | 13.4% |
| Nov 30, 2025 | $126.6M | $26.0M | $100.6M | 20.6% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Aug 31, 2025
+7.2 pts
Year-over-year change
Nov 30, 2024
-16.8 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The sequential improvement in gross margin was driven by a shift in the relationship between cost of revenue and revenue, with revenue growing more than cost of revenue compared to the prior quarter.
Compared to the prior quarter, gross profit and revenue both increased, and gross margin was higher. Compared to the same quarter last year, gross margin was lower despite higher revenue and gross profit, reflecting that cost of revenue increased more than revenue on a relative basis.
Monitor the trend of cost of revenue relative to revenue, as its growth rate influences gross margin direction.