D-Wave Quantum (QBTS -1.82%), a pioneer in quantum computing technology, released its second quarter fiscal 2025 earnings on August 7, 2025. The headline news was strong revenue growth (GAAP revenue up 42% year-over-year in Q2 FY2025) and a significant boost in available cash (cash balance of $819.3 million, up 169% sequentially), with GAAP revenue surpassed expectations at $3.1 million and cash reserves surged to $819.3 million. While these results beat analyst projections (revenue estimate: $2.54 million, Non-GAAP loss per share estimate: -$0.05), the quarter also highlighted ongoing challenges in reaching profitability. Operating losses (GAAP) increased due to heavy investments. The quarter showed continued progress in technology and partnerships, but bookings and recurring revenue trends signaled some headwinds as D-Wave works toward a scalable business model.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (Non-GAAP) | ($0.08) | ($0.05) | ($0.12) | 4 cents |
| Revenue (GAAP) | $3.1 million | $2.54 million | $2.2 million | 42% |
| Non-GAAP Gross Profit | $2.2 million | $1.6 million | 39% | |
| Non-GAAP Gross Margin | 71.8% | 73.1% | (1.3 pp) | |
| Adjusted EBITDA Loss | ($20.0 million) | ($13.9 million) | 44% |
Source: Analyst estimates for the quarter provided by FactSet.
About D-Wave Quantum and Its Current Focus
D-Wave Quantum is a technology company specializing in quantum computing, particularly quantum annealing technology. Its business centers on selling quantum computers, cloud-based quantum computing services, and professional services to help customers solve complex problems. The company targets sectors like manufacturing, logistics, financial services, and government, aiming to offer solutions that are either not feasible or extremely difficult using traditional computers.
Recently, the company's top priorities have been expanding its technological capabilities, growing its patent portfolio, and increasing customer adoption. The success of its cloud-first Leap quantum service and the development of its new Advantage2 system are central to its long-term strategy. Key measures of progress include how quickly proof-of-concept customer projects become full-scale production deployments and the growth rate of recurring revenues.
Quarter in Review: Key Developments and Performance
The second quarter featured a mix of technical milestones and financial events. D-Wave Quantum launched general availability for its Advantage2 quantum computer, its most advanced annealing system yet. Advantage2 offers higher qubit connectivity and greater overall performance than previous systems, making it suitable for more complex real-world applications. The company also released an open-source toolkit to help developers use quantum computing for artificial intelligence and machine learning tasks, targeting broader adoption in those fields.
On the commercial front, D-Wave Quantum expanded customer relationships and use cases. Notable new or renewed partnerships included companies and institutions such as E.ON, GE Vernova, Nikon, Sharp, NTT Data, NTT DOCOMO, the University of Oxford, and the UK's National Quantum Computing Centre. The company reported serving over 100 revenue-generating customers over the last year. However, the total active customer count has largely stabilized rather than growing rapidly, and much of the revenue growth is concentrated in a handful of larger deals or deployments.
Financially, D-Wave Quantum’s GAAP revenue topped Street estimates by a sizable margin, coming in 22% ahead of expectations. Bookings—which indicate new contracted business and are a leading indicator for future revenue—rose sharply to $1.3 million from $0.7 million a year ago. Six-month bookings for the period ended June 30, 2025, were $2.9 million, down from $3.3 million in the same period of 2024. The high margin on system sales in Q1 FY2025 did not repeat this quarter, and the non-GAAP gross margin fell slightly to 71.8%. GAAP operating expenses climbed 41% year over year, mainly because of expanded research and development, more hiring, higher stock-based compensation, and fabrication costs. This investment in growth aimed to promote commercial scaling and maintain technological leadership. The company recorded a large GAAP net loss, but most of that was due to non-cash charges related to the increasing value of warrants and related transactions because of D-Wave’s rising stock price. On an adjusted basis (excluding one-time items), the net loss per share improved but was still negative at ($0.08) on an adjusted (non-GAAP) basis.
The company’s liquidity improved dramatically this period thanks to a major equity raise, proceeds from warrant exercises, and its equity line of credit. Cash and equivalents reached a company record of $819.3 million, compared to $41 million a year ago and $304.3 million in cash as of Q1 FY2025. At the same time, the number of shares outstanding rose significantly, reflecting dilution from fundraising. Deferred revenue, current, dropped 74% year-over-year.
Products, Technology, and Strategic Shifts
D-Wave Quantum’s product lineup features three main offerings: quantum computing systems (sold to select customers and research partners for on-premise use), quantum computing as a service (QCaaS, delivered through its Leap quantum cloud platform), and professional services for developing custom solutions. The company is the only provider in the quantum market building both quantum annealing (for optimization problems) and gate-model systems (the industry-standard model for general-purpose quantum computing). The recently launched Advantage2 system, made generally available in Q2 2025, is an annealing quantum computer that offers more qubits (quantum bits), higher coherence, and new error mitigation techniques. Qubits are the basic units of information in quantum computing, and more qubits generally mean more computational power.
The Leap platform provides real-time remote access to D-Wave’s latest quantum hardware, including newly released systems like Advantage2. This cloud-based model lets customers use quantum computing resources without having to own or operate quantum machines themselves. The company also provides integration tools to tie quantum resources into artificial intelligence and machine learning applications, which could help drive new customer segments and use cases, especially as interest grows in quantum-enhanced AI solutions.
During the quarter, investments in advanced cryogenic packaging and multichip scaling supported the technical path toward larger, more powerful systems, including future generations with 100,000 or more qubits. These capabilities are positioned as key differentiators, particularly as competitors work to address the same technical hurdles.
Material one-time financial events included a large, non-cash accounting charge resulting from the company’s rising warrant value and exercises, which inflated its reported GAAP net loss. This did not impact operating cash flow but did result in a much higher headline loss number. No dividend was declared or adjusted in the period, as D-Wave Quantum does not currently pay a dividend.
Looking Ahead: Guidance and Future Priorities
D-Wave Quantum’s leadership did not provide explicit financial guidance for future quarters or for fiscal 2025 as a whole. No targets or timelines were shared for when positive cash flow or sustained profitability might be reached.
As D-Wave Quantum continues building out its product and service lines, investors and observers may want to watch several key areas in the coming quarters. Metrics to monitor include growth in recurring revenues from cloud-based QCaaS, progress in converting pilot and proof-of-concept clients into production users, and the consistency of bookings relative to revenue. The lumpy nature of high-margin system sales, versus steadier service revenues, will affect both gross margins and top-line growth, as shown by D-Wave's Q1 FY2025 results, where the sale of a quantum computing system drove a significant increase in gross margin compared to typical recurring QCaaS margins. Any additional advancements or public demonstrations of quantum supremacy -- the ability of a quantum computer to solve real-world problems beyond the reach of traditional systems -- may also accelerate customer adoption and growth. Management’s focus remains on scaling up production use cases, building new tools for developer and enterprise adoption, and forging partnerships across industries and global markets.
QBTS does not currently pay a dividend.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
