D-Wave Quantum (QBTS 5.32%), an early mover in the quantum computing market, went public by merging with a special purpose acquisition company (SPAC) on Aug. 22, 2022. It started trading at $10, but it sank to a record low of $0.41 on May 12, 2023. At the time, its persistent dilution, steep losses, and sky-high valuation all drove away its investors. Rising interest rates and threats of a potential delisting made its volatile stock even less appealing.
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But as of this writing, D-Wave's stock trades at about $14. If you had invested $1,000 in the stock at its all-time low, your investment would be worth more than $34,000. The bulls rushed back as interest rates declined, the quantum computing market heated up again, and it rolled out a powerful new processor. But is it still worth buying today?
What does D-Wave Quantum do?
In traditional binary computers, processors store their data in zeros and ones. But in quantum computers, zeros and ones can be stored simultaneously in qubits. That difference allows quantum computers to process a wider range of data at a much faster rate than binary ones.
Yet quantum computers are still bigger, more expensive, and prone to make more mistakes than their binary counterparts. That's why they're still mainly used for niche research projects at government agencies and universities instead of mainstream computing applications.
D-Wave Quantum is trying to break out of its niche with its quantum annealing tools, which help companies streamline their schedules, workflows, supply chains, and logistics networks. As a quantum-powered "efficiency expert," D-Wave runs a company's processes through different scenarios and identifies the one that consumes the least energy as the most efficient one.
That approach could help D-Wave challenge traditional cloud-based analytics companies, and over 100 organizations -- including Deloitte, Mastercard, Lockheed Martin, and Accenture -- are already using its services. D-Wave designs its own chips and hardware, and it provides its own cloud-based services through its Leap platform -- which can be integrated into the world's top cloud infrastructure platforms.
What are D-Wave's near-term catalysts?
In 2024, D-Wave only generated $8.8 million in revenue, most of which came from its cloud-based quantum computing services, as it racked up a net loss of $143.9 million.
But in 2025, analysts expect its revenue to nearly triple to $24.4 million as it narrows its net loss to $72.9 million. That growth should be driven by its new 4,400-qubit Advantage2 processor, which can solve complex 3D lattice problems approximately 25,000 times faster while consuming less power than its first-gen Advantage processor. It officially launched the Advantage2 quantum system for its Leap cloud platform in May.
Meanwhile, its new LaunchPad platform for Leap -- which offers free trials, support, and rapid pilot-to-production tools for enterprise R&D customers -- could lock in new customers and boost its recurring subscription-based revenues. It also plans to add more quantum AI tools (including a more powerful neural network and tighter integrations with data center GPUs) to tackle more AI and machine learning workloads. Those upgrades could attract the attention of more enterprise customers, tether it to the booming AI market, and elevate D-Wave's reputation as the quantum computing play for more practical business applications.
If those efforts bear fruit, analysts expect its revenue to surge 56% to $38.1 million in 2026 and nearly double to $74.1 million in 2027. They also expect it to narrow its losses in both years, but it won't come close to breaking even anytime soon.
What are D-Wave's biggest challenges?
That growth trajectory would be impressive, but it's already priced for perfection at 60 times its projected sales for 2027. It has also increased its number of shares by 184% since it closed its SPAC merger, mainly due to its secondary offerings and stock-based compensation costs, and that dilution will continue as long as it keeps burning cash.
D-Wave is carving out a niche in the nascent quantum computing market, but it still faces plenty of competition from "universal" gate-based processors from companies like IBM, Alphabet's Google, Rigetti, and IonQ -- all of which aim to solve a broader range of problems than quantum annealing. If D-Wave struggles to keep pace with those challengers, its business could eventually collapse.
Lastly, D-Wave's insiders were also net sellers over the past year. Over the past three months, they sold more than three times as many shares as they bought. That chilly insider sentiment suggests that too much growth might be baked into its current valuations.
Is it the right time to buy D-Wave?
D-Wave looks expensive relative to its near-term growth, but it's tough to tell how much the quantum computing market could expand over the next few decades. It might be worth nibbling on as a speculative play on the long-term growth of the quantum computing market, but I wouldn't go all-in on the stock at these levels.
