Applied Blockchain, Inc. (NASDAQ: APLD) is engaged as a blockchain-powered data center company, which is focused on developing blockchain infrastructure and supporting Bitcoin mining. Shares of the blockchain mining company surged 100% during trading on Tuesday, July 19, 2022. Over the past three months, Applied Blockchain has seen an average daily volume of 682,070 shares. However, volume of 126.19 million shares or dollar volume of around $267.52 million, exchanged hands during Tuesday’s trading session.
Shares of Applied Blockchain are soaring after the company has made several announcements over the past couple of days. The blockchain company announced that it has entered into a five-year hosting contract with Marathon Digital Holdings, Inc. (NASDAQ: MARA) for 200-Megawatts of Bitcoin mining capability. Marathon’s Bitcoin mining machines will be held and operated at Applied Blockchain’s owned and operated co-hosting data centers. Although the specific financial commitments were not released, Applied Blockchain Chairman and CEO, Wes Cummins, says the contract will provide “predictable revenue over a multi-year timeframe.”
In addition to the major Marathon Digital contract news, Applied Blockchain released an investor update on its operations and financial guidance. The company has updated its fiscal fourth quarter 2022 financial guidance with the revenue range increasing to between $5.95 million and $7.2 million.
Applied Blockchain did disclose some issues at its Jamestown, North Dakota facility, which is partially offline due to an unexpected equipment failure at the substation that powers the facility. On the other hand, the company says the construction of its 200MW facility in Garden City, Texas is continuing to progress with several structures erected. In addition, a third co-hosting data center in North Dakota is undergoing design and pre-construction. Once the third facility in the state is completed, Applied Blockchain will have a total hosting capacity of 500MW.
“Since we reported our fiscal third quarter 2022 results in mid-May, our operations have continued at or better than expectations, driving our financial performance above the guidance we previously communicated,” said Applied Blockchain Chairman and CEO Wes Cummins. “While we have a short-term setback with part of our capacity being offline in Jamestown for several weeks, the Company has never been in a better position. Our new 200MW hosting agreement with Marathon, announced separately today, not only reinforces the high level of demand for hosting, but the structure of the agreement allows us to accelerate our buildout without equity dilution. Additionally, our third co-hosting datacenter is expected to give us a clear path to 500MWs online early next calendar year, which we estimate can generate $100 million of Adjusted EBITDA on an annual basis.”
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