D-Wave Quantum (NASDAQ:QBTS) Announces Earnings Results

D-Wave Quantum (NASDAQ:QBTS) announced its quarterly earnings results on Tuesday. The company reported ($0.13) earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of ($0.10) by ($0.03), FiscalAI reports. D-Wave Quantum had a negative return on equity of 26.67% and a negative net margin of 2,001.59%. The business had revenue of $4.51 million for the quarter, compared to analysts’ expectations of $4.37 million. During the same period last year, the firm earned ($0.41) earnings per share.

Here are the key takeaways from D-Wave Quantum’s conference call:

• Third-quarter revenue rose 21% year over year to $4.5 million, with QCaaS subscription revenue up 56% and professional services up 318%. Bookings were mixed: down 19% in the quarter to $1.9 million, but up 611% year to date to $37.4 million, including a $20 million Florida Atlantic University system sale expected to generate substantial revenue in Q4.
• Commercial indicators strengthened, with the sales pipeline up more than 75% from Q2 and remaining performance obligations reaching $38.3 million, over 13 times the year-earlier balance. D-Wave said 59% of RPO is expected to convert to revenue within 12 months; NTT DOCOMO also deployed a second production application using its technology.
• Costs and losses increased: GAAP operating expenses rose 84% year over year to $55.9 million, while adjusted EBITDA loss widened by $17 million to $37.7 million. GAAP gross margin fell to 52.9%, which the company attributed mainly to a greater share of lower-margin professional services revenue.
• D-Wave secured a definitive agreement providing access to up to $100 million in CHIPS Act funding, subject to milestones, and reported $503.4 million in cash and marketable securities at quarter-end. It also advanced hardware plans, including a dual-chip annealing processor entering fabrication and scalable control chips expected back for testing.
• The company reiterated its goal of a 17-qubit gate-model system and said it is discussing orders for delivery in 2027; its longer-term target is 100 fault-tolerant logical qubits by 2032. These remain roadmap goals, and management said no quantum computing company has yet produced a logical qubit meeting its stated fault-tolerant standard.

D-Wave Quantum Stock Performance

Shares of NASDAQ QBTS traded down $1.19 during trading hours on Tuesday, reaching $10.28. The stock had a trading volume of 15,085,087 shares, compared to its average volume of 25,398,203. The firm has a 50-day moving average of $14.47 and a 200-day moving average of $18.84. The firm has a market cap of $3.80 billion, a price-to-earnings ratio of -14.67 and a beta of 2.35. The company has a current ratio of 20.55, a quick ratio of 20.42 and a debt-to-equity ratio of 0.03. D-Wave Quantum has a fifty-two week low of $8.48 and a fifty-two week high of $32.39.

D-Wave Quantum News Roundup

Here are the key news stories impacting D-Wave Quantum this week:

• Positive Sentiment: Third-quarter revenue rose 21% year over year to $4.5 million, slightly ahead of analyst expectations. The net loss narrowed to $48.2 million from $140.0 million a year earlier. D-Wave reports third-quarter revenue
• Positive Sentiment: Nine-month bookings surged 611% to $37.4 million, while remaining performance obligations climbed 1,221% year over year to $38.3 million—indicators of potential future demand. D-Wave also reported $503.4 million in cash and investments and access to up to $100 million in conditional federal funding. D-Wave reports third-quarter revenue
• Negative Sentiment: The reported loss of $0.13 per share was worse than analysts’ expected $0.10 loss. Operating expenses rose 84% to $55.9 million, and third-quarter bookings fell about 19% year over year, sharpening concerns about costs and near-term sales momentum. D-Wave falls on wider-than-expected loss
• Negative Sentiment: Coverage of an existing securities class action and its December 15 lead-plaintiff deadline adds legal uncertainty. The lawsuit contains allegations, which have not been established as fact. Shareholder alert

Analyst Ratings Changes

A number of analysts have weighed in on QBTS shares. Canaccord Genuity Group set a $35.00 price objective on shares of D-Wave Quantum in a report on Thursday, August 6th. Zacks Research downgraded shares of D-Wave Quantum from a “strong-buy” rating to a “hold” rating in a research report on Tuesday, August 18th. Benchmark initiated coverage on shares of D-Wave Quantum in a report on Monday, July 27th. They issued a “buy” rating and a $30.00 target price for the company. B. Riley Financial dropped their target price on shares of D-Wave Quantum from $27.00 to $22.00 and set a “buy” rating on the stock in a research report on Monday. Finally, Wall Street Zen upgraded shares of D-Wave Quantum from a “strong sell” rating to a “sell” rating in a research note on Saturday, August 8th. Thirteen analysts have rated the stock with a Buy rating, two have given a Hold rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat.com, the company presently has an average rating of “Moderate Buy” and an average price target of $35.07.

About D-Wave Quantum

D-Wave Quantum develops quantum computing systems, software and services for commercial, government and research users. The company focuses on quantum annealing, an approach designed to help solve complex optimization and sampling problems, and offers hybrid tools that combine quantum processing with classical computing.

Its offerings include Advantage quantum computers, the Leap quantum cloud service, and software for building and running applications. D-Wave’s technology is used to explore challenges such as scheduling, resource allocation and supply-chain optimization.

Founded in 1999, D-Wave has long focused on bringing quantum computing into practical use.