What a time for tech investors. Quantum computing looks like a remarkable follow-up to artificial intelligence (AI). Researchers at McKinsey estimate that quantum computing could create up to $2.7 trillion in economic value for companies worldwide by 2040. Quantum computers could unlock new possibilities across applications, ranging from drug discovery to cybersecurity and AI.
D-Wave Quantum (QBTS +5.35%) is a promising quantum computing company. Its quantum annealing systems are already commercially available, and the acquisition of Quantum Circuits earlier this year gives it a pathway to gate-model systems. As a result, the company can pursue a broad range of commercial opportunities.
But is D-Wave Quantum stock actually a millionaire-maker? Investors may want to temper their expectations.
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The stock is way ahead of the business
Many millionaire-maker stocks start out really small. That's because it's usually much easier for a stock's market cap to grow from $500 million to $5 billion than it is to go from $50 billion to $500 billion. It's just difficult to grow large numbers for all but the most exceptional businesses. D-Wave Quantum's current market cap of $6.2 billion doesn't seem huge at first glance. That's until you look at the actual business, which is still in its infancy.
D-Wave Quantum has generated only $12.4 million in total revenue over the past year. Wall Street analysts estimate that revenue will grow to $42.8 million this year and $85.8 million next year. That's really strong growth, but from a tiny base. The stock is still very expensive, trading at approximately 72 times next year's revenue estimate. To realistically deliver life-changing investment returns from here, D-Wave Quantum probably needs to grow to a market cap of at least $100 billion.
Why that could be a very tall task
It's highly unlikely that D-Wave Quantum will have the opportunity to achieve that anytime soon. The quantum computing industry is overcrowded with other emerging pure-play companies and established tech firms, including International Business Machines, Microsoft, Amazon, Nvidia, and Alphabet, all developing quantum computers. McKinsey estimated that total industry revenue was $1 billion in 2025, so you can see just how insignificant D-Wave Quantum is at this moment.
NYSE: QBTS
Key Data Points
It's still so early that investors have little way of knowing how D-Wave Quantum eventually fits into the competitive landscape. On top of that, it's hard to see D-Wave Quantum competing with the cloud giants in cloud-based quantum services. That potentially restricts the company's primary market opportunity to on-premise systems.
Lastly, none of this takes profitability into account. D-Wave Quantum has burned through $102.7 million in free cash flow over the past four quarters, resulting in a net loss of $368 million. Investors face share dilution as the company raises new capital to fund its operations over time. It's an understatement to call the stock risky. A risky stock can be a millionaire-maker when you buy at a cheap valuation. But D-Wave Quantum isn't that anymore.
