D-Wave Quantum Q2 Earnings Call Highlights
Key Points
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- Revenue was essentially flat year over year at $3.1 million, but QCaaS subscription revenue rose 50% and bookings increased 59% to $2.1 million. Backlog surged 668% to $40.7 million, with 57% expected to convert to revenue within 12 months.
- D-Wave’s net loss narrowed to $48 million from $167.3 million, largely because of lower non-cash warrant-related charges, while its adjusted EBITDA loss widened to $37.1 million as the company increased spending on product development and sales. Cash and marketable securities totaled $546.2 million after the Quantum Circuits acquisition.
- Commercial adoption is expanding: production applications generated 37% of first-half QCaaS revenue, with deployments at at, Optum and NTT Docomo. D-Wave expects modest third-quarter revenue growth and a significantly stronger fourth quarter driven by system shipments.
D-Wave Quantum (NASDAQ:QBTS) reported second-quarter 2026 revenue of $3.1 million, essentially unchanged from the year-earlier period, as growth in quantum computing-as-a-service subscriptions and professional services offset a smaller contribution from systems revenue.
The company said second-quarter QCaaS subscription revenue rose 50% year over year to $1.9 million, while professional services revenue increased more than 18% to about $900,000. Systems and other revenue was approximately $300,000, primarily tied to installation and site-preparation activities for a previously announced $20 million system sale to Florida Atlantic University.
Bookings increased 59% from a year earlier to $2.1 million in the quarter, while the average booking size rose more than 87%, according to Chief Financial Officer John Markovich. The company recognized revenue from about 100 customers, with commercial enterprises accounting for 62.4% of revenue, up from 45.1% a year earlier. Forbes Global 2000 customers represented 47.7% of quarterly revenue, compared with 20.4% in the prior-year quarter.
Losses Rise as Company Invests in Development and Sales
D-Wave posted a second-quarter net loss of $48 million, or $0.13 per share, compared with a net loss of $167.3 million, or $0.55 per share, a year earlier. The narrower net loss was primarily driven by a $142 million decline in non-cash, non-operating charges related to the remeasurement of its former warrant liability. The company redeemed all of its remaining publicly traded warrants in November 2025.
Adjusted EBITDA loss widened to $37.1 million from $20 million in the prior-year quarter. Markovich said the increase reflected higher personnel-related spending to support accelerated product development and go-to-market initiatives.
GAAP gross profit declined 14% to $1.7 million, and gross margin fell to 55.4% from 63.8%, which the company attributed primarily to increased personnel costs.
For the first six months of 2026, revenue was $5.9 million, down 67% from $18.1 million in the first half of 2025. The prior-year period included $13.7 million of revenue from D-Wave’s first annealing quantum computer system sale. First-half bookings, however, climbed to $35.5 million from $2.9 million, including the $20 million Florida Atlantic University system order.
Remaining performance obligations, or backlog, totaled $40.7 million as of June 30, up 668% from a year earlier. D-Wave said about 57% of that balance is expected to be recognized as revenue within 12 months and 72% within two years.
Production Applications Gain Greater Share of QCaaS Revenue
Chief Executive Officer Alan Baratz said the company now has six customer applications in production and is seeing broader interest from large enterprises. More than 37% of first-half QCaaS revenue, or $1.3 million, came from production business applications, compared with 9.8%, or about $300,000, in the first half of 2025.
D-Wave highlighted several customer deployments during the call:
- AT expanded its agreement with D-Wave to apply annealing quantum computing to network optimization. D-Wave said one early application reduced processing time from about one hour to less than 15 seconds. AT plans to assess further uses involving outage response, technician routing, network planning and traffic management.
- Optum, a UnitedHealth Group subsidiary, moved from an initial proof-of-technology effort directly into a production application for optimization problems involving thousands of variables and hundreds of thousands of constraints. Baratz said the application had run about 30,000 jobs by mid-June after launching in May.
- NTT Docomo used D-Wave technology in mobile-network optimization applications. The company said one deployment reduced paging signals by 15%, while another reduced location-registration signals by about 65% and paging signals by 7% during peak periods.
Baratz said the company’s QCaaS pipeline is expanding and that D-Wave is closing larger deals with larger companies. He also said roughly 25% to 30% of current discussions involve business units directly or bring business units into conversations early, compared with none a year ago.
Gate-Model Roadmap and Annealing System Plans
D-Wave also detailed progress on its gate-model quantum computing program following its acquisition of Quantum Circuits earlier this year. The company announced peer-reviewed research published in Nature describing a two-qubit entangling gate on an eight-qubit dual-rail processor. According to Baratz, the research demonstrated approximately 99.9% fidelity in two-qubit operations with gate times of about 500 nanoseconds.
The company expects to deliver a 17-physical-qubit dual-rail system later in 2026, followed by a 49-physical-qubit system in 2027 and a 181-physical-qubit system in 2028. D-Wave said the systems are designed to demonstrate progressively lower logical error rates. Its longer-term roadmap calls for a 10-logical-qubit system in 2030 and a system with 100 logical qubits and more than 1 million reliable operations by 2032.
Baratz said D-Wave expects to make a gate-model simulator available through its Leap quantum cloud platform later this year. The company said the simulator is intended to support error-aware quantum programming based on the expected behavior of its dual-rail architecture.
On the annealing side, D-Wave reiterated plans for a 20,000-qubit Advantage 3 system in 2029 and a 100,000-qubit system in 2031. The company also expects to ship two annealing quantum computer systems in 2026, likely during the fourth quarter.
Outlook and Liquidity
Markovich said third-quarter revenue is expected to rise modestly from second-quarter levels, while fourth-quarter revenue should increase significantly from the third quarter and account for the majority of 2026 revenue. The timing reflects expected fourth-quarter system shipments and the subsequent installation and calibration work, some of which may carry into 2027.
As of June 30, D-Wave had $546.2 million in cash and marketable investment securities, down from $819.3 million a year earlier. More than 90% of the decrease was related to approximately $250 million in cash consideration paid for the Quantum Circuits acquisition, the company said.
About D-Wave Quantum (NASDAQ:QBTS)
D-Wave Quantum Inc (NYSE: QBTS) develops and provides quantum computing systems, software and services focused on quantum annealing technology. Headquartered in Burnaby, British Columbia, D-Wave designs specialized processors that leverage quantum mechanics to solve complex optimization and sampling problems. Since its founding in 1999 by physicists including Geordie Rose, the company has pursued the development of commercially viable quantum hardware and accompanying software tools.
The company’s product portfolio centers on its quantum annealers, which are complemented by hybrid solvers that integrate classical and quantum computing resources.
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