D-Wave Quantum (QBTS) Q3 2024 earnings summary

Executive summary

• Maintains leadership in commercial quantum computing with the world's largest quantum computer, a robust product portfolio, and the 5,000-qubit Advantage system, with calibration of the 4,400-qubit Advantage II processor completed and significant performance gains.

• Expanded customer base includes major global enterprises and government agencies, with NTT DOCOMO planning production deployment, and new collaborations in AI-driven drug discovery and manufacturing optimization.

• Over 30 proven business use cases and 20+ successful POC engagements in 18 months, with more than 132 customers, including Forbes Global 2000 clients.

• Progress in quantum AI solutions, including generative AI architectures and hybrid-quantum applications for faster, more energy-efficient model training.

• Leadership team strengthened with new CHRO and two board members to support growth.

Financial highlights

• Q3 2024 revenue was $1.9M, down 27% year-over-year, mainly due to lower professional services revenue; QCaaS revenue rose 41% to $1.6M.

• Nine-month 2024 revenue was $6.5M, up 11.4% year-over-year, with research and government revenue up 70.5% to $2.0M.

• Q3 GAAP gross profit was $1.0M (down 32%), with a GAAP gross margin of 55.8%; non-GAAP gross margin was 67.2%.

• Q3 net loss was $22.7M ($0.11/share), up from $16.1M ($0.12/share) last year; nine-month net loss was $57.8M ($0.32/share), improved from $66.7M ($0.51/share) last year.

• Q3 adjusted EBITDA loss was $13.8M, up 19% year-over-year; nine-month adjusted EBITDA loss was $40.6M, down 6%.

Outlook and guidance

• Q4 2024 revenue and bookings expected to improve over Q3, with fiscal 2024 adjusted EBITDA loss guidance reiterated at less than $54.3M.

• Aggressive go-to-market strategy continues, with team expansion expected to be completed by mid-Q1 2025 and productivity gains anticipated.

• Management expects continued operating losses and negative cash flows as commercial operations and R&D expand.