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D-Wave Quantum (QBTS)
NYSE:QBTS
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D-Wave Quantum (QBTS) AI Stock Analysis

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QBTS

D-Wave Quantum

(NYSE:QBTS)

Rating:63Neutral
Price Target:
$21.50
▲(31.26%Upside)
D-Wave Quantum's overall score is driven primarily by strong earnings call outcomes and positive corporate developments, which are offset by financial performance challenges and valuation concerns. The technical outlook is moderately positive, supporting a balanced investment perspective.
Positive Factors
Market Position
D-Wave's first-mover advantage in quantum annealing positions the company to capture a significant share of the growing quantum market.
Revenue Growth
Record revenue and quantum supremacy result demonstrate tangible progress for D-Wave Quantum Inc.
Strategic Partnerships
The partnership with South Korea positions D-Wave as a key technology partner in the country's national quantum initiative, gaining significant credibility and access to a promising geography.
Negative Factors
Equity Offering
D-Wave Quantum Inc. announced the successful completion of a $400 million ATM equity offering, which may lead to dilution concerns among existing shareholders.
Market Competition
D-Wave's dual-track approach uniquely positions the company relative to pure-play competitors, but may also stretch resources and focus across multiple fronts.

D-Wave Quantum (QBTS) vs. SPDR S&P 500 ETF (SPY)

D-Wave Quantum Business Overview & Revenue Model

Company DescriptionD-Wave Quantum Inc. (QBTS) is a leader in the development and delivery of quantum computing systems, software, and services. The company operates in the rapidly evolving quantum computing sector, focusing on providing accessible and practical quantum computing solutions for businesses and researchers. D-Wave's core products include quantum computers, quantum annealers, and a cloud-based quantum computing platform, Leap, which allows users to build and run quantum applications.
How the Company Makes MoneyD-Wave Quantum makes money primarily through the sale of its quantum computing systems and related services. The company's revenue streams include direct sales of quantum hardware, subscription fees for access to its Leap quantum cloud service, and professional services for clients looking to develop specific quantum applications. D-Wave also partners with research institutions and commercial enterprises to foster the development of quantum applications, which can lead to additional revenue through collaborative projects and consulting services. Strategic partnerships and collaborations are significant factors contributing to D-Wave's earnings, as they help expand the company's market reach and application base.

D-Wave Quantum Earnings Call Summary

Earnings Call Date:May 08, 2025
(Q1-2025)
|
% Change Since: 137.74%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong positive sentiment driven by record financial performance, technical achievements, and commercial progress. However, challenges such as decreased bookings and limited interest from the US Government were noted.
Q1-2025 Updates
Positive Updates
Record Quarterly Revenue
D-Wave reported a record Q1 revenue of $15 million, a significant increase of 509% from the previous year's Q1 revenue of $2.5 million.
Strong Financial Position
The company closed the quarter with a record $304 million in cash, providing a solid financial position to achieve profitability.
Quantum Supremacy Achievement
D-Wave's 1200 qubit prototype Advantage2 quantum computer demonstrated quantum supremacy by performing a complex simulation in minutes, which would take nearly 1 million years on a supercomputer.
Advancements in Quantum Computing
The Advantage2 system has achieved milestones such as calibrated 4,400+ qubit processors, increased coherence time, and enhanced qubit connectivity, showing impressive performance gains.
Commercial Progress with Ford Otosan
Ford Otosan developed a hybrid quantum application in production, improving scheduling time for 1,000 vehicles from 30 minutes to less than five minutes.
Significant Gross Margin Improvement
GAAP gross margin for the first quarter was 92.5%, up from 67.3% in the previous year, driven by higher-margin system sales.
Negative Updates
Decrease in Bookings
Bookings for the first quarter were $1.6 million, a decrease of 64% from the previous year's first-quarter bookings of $4.5 million.
Limited US Government Interest
The US Government shows less interest in annealing quantum systems compared to other governments, presenting a challenge for expanding in the US market.
Dependency on System Sales
The company's gross margin improvement is strongly tied to system sales, which may not be consistent quarter over quarter.
Company Guidance
During the Q1 FY2025 earnings call, D-Wave highlighted significant financial and technical achievements. The company reported record quarterly revenue of $15 million, a substantial increase from $2.5 million in Q1 FY2024, driven by the sale of an Advantage2 system. The cash position at the end of the quarter was a robust $304 million, believed to be sufficient to reach profitability. Gross margins also improved significantly, with non-GAAP gross margin increasing to 93.6% from 76.6% in the previous year. The quarter's net loss decreased to $5.4 million, down from $17.3 million in the prior year, marking the lowest quarterly loss since D-Wave became a public company. Key technical milestones included the demonstration of quantum supremacy, advancements in the Advantage2 system, and new developments in blockchain and AI applications. The company also reported increased interest and engagement from customers, including Ford Otosan and Japan Tobacco, as they move towards production applications.

D-Wave Quantum Financial Statement Overview

Summary
D-Wave Quantum shows strong revenue growth, but faces significant financial challenges with persistent losses and negative cash flows. The balance sheet is strong with substantial cash positions and minimal debt, but profitability remains a major concern.
Income Statement
35
Negative
D-Wave Quantum shows a consistent increase in total revenue over the years, with a notable growth of 142% in TTM compared to the previous year. However, the company is struggling with profitability, as evidenced by negative net income and EBIT margins. The EBIT margin is significantly negative at -332%, and the net profit margin stands at -618% for TTM, indicating high operational and financial challenges.
Balance Sheet
40
Negative
The balance sheet reflects a strong cash position with substantial cash and cash equivalents, which has improved significantly over recent periods. However, the stockholders' equity has fluctuated, showing negative equity in previous years but has improved to a positive $207 million in the TTM. The debt-to-equity ratio is low at 0.04, suggesting minimal leverage, but the company's equity ratio is relatively healthy at 64% in TTM.
Cash Flow
30
Negative
Operating cash flow remains negative, indicating ongoing cash burn, with free cash flow also in the negative. The free cash flow has worsened to -$52 million in TTM compared to the previous period. The cash flow from financing activities is robust, highlighting reliance on external financing to support operations, but free cash flow to net income ratio remains unfavorable.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue8.83M8.76M7.17M6.28M5.16M
Gross Profit5.56M4.62M4.25M4.53M4.25M
EBITDA-138.05M-80.83M-49.03M-34.36M-14.06M
Net Income-143.88M-82.72M-53.70M-40.97M-21.97M
Balance Sheet
Total Assets199.85M59.36M26.95M32.61M47.46M
Cash, Cash Equivalents and Short-Term Investments177.98M41.31M7.07M9.48M21.34M
Total Debt38.38M72.65M18.99M21.17M4.66M
Total Liabilities137.21M83.84M33.12M29.59M14.73M
Stockholders Equity62.65M-24.48M-6.17M3.02M32.73M
Cash Flow
Free Cash Flow-44.75M-61.28M-45.72M-36.80M-30.08M
Operating Cash Flow-42.64M-60.65M-45.23M-34.80M-29.29M
Investing Cash Flow-3.14M-630.00K-498.00K-2.00M-789.00K
Financing Cash Flow182.45M95.64M43.27M24.91M43.14M

D-Wave Quantum Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price16.38
Price Trends
50DMA
16.74
Negative
100DMA
12.52
Positive
200DMA
8.56
Positive
Market Momentum
MACD
0.49
Positive
RSI
46.57
Neutral
STOCH
8.31
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For QBTS, the sentiment is Neutral. The current price of 16.38 is below the 20-day moving average (MA) of 17.43, below the 50-day MA of 16.74, and above the 200-day MA of 8.56, indicating a neutral trend. The MACD of 0.49 indicates Positive momentum. The RSI at 46.57 is Neutral, neither overbought nor oversold. The STOCH value of 8.31 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for QBTS.

D-Wave Quantum Risk Analysis

D-Wave Quantum disclosed 61 risk factors in its most recent earnings report. D-Wave Quantum reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

D-Wave Quantum Peers Comparison

Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
63
Neutral
$5.37B-154.89%121.61%-13.50%
62
Neutral
$34.53B6.79-11.66%2.11%6.09%-7.36%
58
Neutral
$4.68B-85.28%-28.38%-29.15%
54
Neutral
$10.43B-52.11%69.92%-79.18%
50
Neutral
$2.37B-30.47%45.57%-35.70%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
QBTS
D-Wave Quantum
16.38
15.44
1642.55%
QUBT
Quantum Computing
14.80
14.20
2366.67%
IONQ
IonQ
38.12
31.04
438.42%
RGTI
Rigetti Computing
14.12
13.22
1468.89%

D-Wave Quantum Corporate Events

Product-Related AnnouncementsBusiness Operations and Strategy
D-Wave Quantum Announces New Cryogenic Packaging Initiative
Positive
Jul 30, 2025

On July 30, 2025, D-Wave Quantum Inc. announced a strategic initiative focused on advanced cryogenic packaging to enhance its quantum processor development. By leveraging expertise from NASA’s Jet Propulsion Laboratory, D-Wave aims to scale its annealing and gate-model architectures, supporting its goal of reaching 100,000 qubits. This initiative is expected to strengthen D-Wave’s leadership in quantum systems technology and bolster its product roadmap, impacting its manufacturing capabilities and supply chain.

The most recent analyst rating on (QBTS) stock is a Buy with a $8.50 price target. To see the full list of analyst forecasts on D-Wave Quantum stock, see the QBTS Stock Forecast page.

Business Operations and Strategy
D-Wave Quantum Highlights Quantum Optimization Potential
Positive
Jul 21, 2025

On July 21, 2025, D-Wave Quantum Inc. announced the results of a study conducted with Wakefield Research, highlighting the potential of quantum optimization to create significant value across industries. The study, which surveyed 400 business leaders in North America, Europe, and APAC, revealed that many leaders are reaching the limits of classical computing for optimization and are turning to quantum technologies. A significant portion of respondents expect substantial returns on investment from quantum optimization, with 46% anticipating between $1 and $5 million, and 27% expecting over $5 million in the first year. The findings underscore a growing interest in quantum computing as a solution for complex optimization challenges, with 53% planning to integrate it into their workflows.

The most recent analyst rating on (QBTS) stock is a Buy with a $2.25 price target. To see the full list of analyst forecasts on D-Wave Quantum stock, see the QBTS Stock Forecast page.

Private Placements and FinancingBusiness Operations and Strategy
D-Wave Quantum Completes $400M Equity Offering Program
Positive
Jul 1, 2025

On July 1, 2025, D-Wave Quantum Inc. announced the successful completion of its $400 million ‘at-the-market’ equity offering program, which ran from June 11 to June 27, 2025. The program was completed at an average price of $15.18 per share, a significant premium over the previous offering, and increased the company’s cash balance to approximately $815 million. The proceeds are intended for strategic acquisitions and general corporate purposes, reinforcing D-Wave’s position as a leading commercial quantum computing company.

The most recent analyst rating on (QBTS) stock is a Buy with a $2.25 price target. To see the full list of analyst forecasts on D-Wave Quantum stock, see the QBTS Stock Forecast page.

Business Operations and Strategy
D-Wave Quantum Partners with Yonsei University for Quantum Advancement
Positive
Jun 17, 2025

On June 17, 2025, D-Wave Quantum Inc. announced a memorandum of understanding with Yonsei University and Incheon Metropolitan City to promote quantum computing in South Korea. This collaboration aims to advance research, talent development, and commercial use cases in biotechnology and materials science, and includes plans for acquiring a D-Wave Advantage2 system at Yonsei University. The partnership is seen as a strategic move to establish Incheon as a global quantum hub and further D-Wave’s mission of accelerating global quantum computing adoption.

The most recent analyst rating on (QBTS) stock is a Buy with a $2.25 price target. To see the full list of analyst forecasts on D-Wave Quantum stock, see the QBTS Stock Forecast page.

Executive/Board ChangesShareholder Meetings
D-Wave Quantum Elects New Directors at Annual Meeting
Neutral
Jun 11, 2025

On June 5, 2025, D-Wave Quantum Inc. held its annual meeting of stockholders, where Steven M. West, Kirstjen Nielsen, and Roger Biscay were elected as Class III directors to serve until 2028. Additionally, the appointment of Grant Thornton LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025, was ratified. The Board also appointed Sharon Holt to replace Steven M. West as chair of the Nominating and Governance Committee and Roger Biscay to replace Kirstjen Nielsen as a member of the Committee, effective immediately after the meeting.

The most recent analyst rating on (QBTS) stock is a Buy with a $2.25 price target. To see the full list of analyst forecasts on D-Wave Quantum stock, see the QBTS Stock Forecast page.

Private Placements and FinancingBusiness Operations and Strategy
D-Wave Quantum Enters $400M Sales Agreement
Positive
Jun 10, 2025

On June 10, 2025, D-Wave Quantum Inc. entered into a sales agreement with several financial agents, allowing the company to sell up to $400 million in common stock. The proceeds from these sales are intended for general corporate purposes, including capital expenditures and potential acquisitions, supporting the company’s path to profitability.

The most recent analyst rating on (QBTS) stock is a Buy with a $2.25 price target. To see the full list of analyst forecasts on D-Wave Quantum stock, see the QBTS Stock Forecast page.

Private Placements and Financing
D-Wave Quantum Secures $15.3 Million from Warrant Exercise
Positive
Jun 4, 2025

Between May 30, 2025, and June 3, 2025, D-Wave Quantum Inc. secured approximately $15.3 million from the exercise of 1.33 million warrants for common stock at $11.50 each. This followed a previous receipt of $80.5 million on May 29, 2025, from the exercise of 7 million warrants, linked to the company’s merger with DPCM Capital, Inc. on August 5, 2022, indicating a significant capital influx to support its operations.

The most recent analyst rating on (QBTS) stock is a Buy with a $8.50 price target. To see the full list of analyst forecasts on D-Wave Quantum stock, see the QBTS Stock Forecast page.

Private Placements and Financing
D-Wave Quantum Secures $80.5 Million from Warrant Exercise
Positive
May 30, 2025

On May 29, 2025, D-Wave Quantum Inc. received approximately $80.5 million from the exercise of about 7 million warrants to purchase common stock at $11.50 per warrant. These warrants were part of the company’s merger with DPCM Capital, Inc. on August 5, 2022, reflecting a significant financial influx that could impact its operations and market positioning.

The most recent analyst rating on (QBTS) stock is a Buy with a $2.25 price target. To see the full list of analyst forecasts on D-Wave Quantum stock, see the QBTS Stock Forecast page.

Product-Related AnnouncementsBusiness Operations and Strategy
D-Wave Quantum Launches Advanced Advantage2 System
Positive
May 20, 2025

On May 20, 2025, D-Wave Quantum Inc. announced the general availability of its Advantage2TM quantum computing system, a significant advancement in the quantum computing industry. The Advantage2 system, featuring D-Wave’s most advanced quantum processor, is designed to solve complex problems beyond the capabilities of classical computers, offering benefits such as increased qubit connectivity, higher energy scale, and greater coherence. This release marks a milestone for D-Wave as it expands its fleet of quantum computers globally, with applications in national security-focused research and collaborations with supercomputing centers to enhance AI and quantum optimization breakthroughs.

The most recent analyst rating on (QBTS) stock is a Buy with a $2.25 price target. To see the full list of analyst forecasts on D-Wave Quantum stock, see the QBTS Stock Forecast page.

Product-Related AnnouncementsBusiness Operations and Strategy
D-Wave Quantum CEO Discusses Quantum Supremacy on Fox
Positive
May 12, 2025

On May 12, 2025, D-Wave Quantum Inc. announced that its CEO, Dr. Alan Baratz, was interviewed on Fox Business’ The Claman Countdown, where he discussed the company’s recent achievements, including a quantum supremacy demonstration. This demonstration highlighted the Advantage2 quantum computer’s ability to outperform a leading supercomputer in a complex materials simulation, capturing the attention of the supercomputer community and national labs globally. Dr. Baratz also mentioned the long lead times in system sales due to their high costs, ranging from $20-$40 million. D-Wave sees annealing quantum computing as a key driver for commercial adoption, particularly for optimization problems prevalent in modern enterprises.

The most recent analyst rating on (QBTS) stock is a Buy with a $2.5000 price target. To see the full list of analyst forecasts on D-Wave Quantum stock, see the QBTS Stock Forecast page.

Executive/Board ChangesBusiness Operations and Strategy
D-Wave Quantum Updates Executive Severance Policy
Neutral
May 7, 2025

On May 1, 2025, D-Wave Quantum Inc. implemented a severance policy for its executives, including Alan Baratz, John Markovich, and Diane Nguyen, which outlines severance benefits in the event of qualifying terminations. This policy requires a participation agreement that replaces any previous severance terms in their employment agreements. The policy details benefits for both Qualifying Non-CIC and CIC Terminations, including cash severance, bonus payments, and COBRA coverage. Additionally, on May 6, 2025, D-Wave amended the employment agreements of these executives to align with the new severance policy, indicating a strategic move to standardize executive compensation and benefits.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 30, 2025