D-Wave (QBTS +0.26%) already has something that matters in industries at the bleeding edge of science: technology customers are willing to pay for. This has won D-Wave many fans, but with annual sales still measured in the tens of millions, its enormous valuation assumes a whole lot more is coming. Will it?
And five years from now, where will D-Wave stock be?
QBTS D-Wave Quantum
NASDAQ · As of 4:00 PM ET 10/23/26
How quantum computing differs from traditional computing
First, a short primer on quantum computing: The phone or laptop you're reading this on processes information using bits -- 0s and 1s. Quantum computers use quantum bits, or "qubits," which can exist in a combination of those two states. That gives them a fundamentally different way to process information, and that means quantum computers could tackle problems that are more or less impossible to solve by traditional methods.
Image source: Getty Images.
Of course, "could" is doing a fair amount of work here. Building the kind of mature, powerful, and widely useful quantum computer that the industry hopes to build is still a real engineering challenge.
D-Wave's approach to commercial quantum computing
D-Wave's "quantum annealing" approach is especially good at optimization. Think problems like scheduling workers across multiple factories or improving routing for a fleet of delivery trucks.
And critically, this approach has yielded more real-world results more quickly than much of the competition. D-Wave already offers its annealing technology commercially. However, there's a catch: Annealing is widely considered to have less upside than other approaches, trading long-term potential for near-term utility.
The company is now pursuing an alternative gate-based approach after the recent acquisition of Quantum Circuits, but it has traditionally been focused on optimization and commercialization.
D-Wave's revenue, bookings, and continued losses
This strategy means that, unlike some of its peers, D-Wave has a real -- albeit modest -- business. Its sales clocked in at $3.1 million last quarter, flat year over year. However, there are signs of better times ahead.
The company's backlog stands at $40.7 million. That includes a single $20 million system sale booked in the first quarter (Q1).
While revenue could pick up, D-Wave is still struggling on the bottom line, losing $48 million in Q2.
The company does, however, have a decent financial cushion, ending June with $546.2 million in cash and securities.
Two scenarios for D-Wave's growth through 2031
For these scenarios, let's start with roughly $42.5 million in 2026 revenue, close to the current analyst consensus.
A bullish scenario
- D-Wave's annealing systems gain wider adoption as customers find meaningful advantages in scheduling, logistics, and other optimization tasks.
- Its gate-based technology progresses, opening up additional applications.
- Sales grow at 50% annually, reaching about $323 million in 2031.
- The company moves closer to profitability but continues operating in the red as it scales.
A bearish scenario
- Annealing finds some useful applications, but adoption remains limited as traditional computing proves competitive.
- Its gate-based systems remain largely confined to research and experimentation.
- Sales grow at 15% annually, reaching about $85 million in 2031.
- The company remains deeply unprofitable and eventually turns to further stock sales to help fund the gap.
Where could D-Wave stock be in five years?
Honestly, I see D-Wave looking a lot more like the latter case five years from now. The company already has some practical applications, but turning those into a large, profitable business and continuing to scale is another matter.
In that scenario, I doubt investors will be willing to pay anywhere near today's enormous sales multiple. Even at 10 times sales, D-Wave would be worth only $850 million, significantly less than the nearly $4.5 billion valuation it carries today.
Of course, I could be very wrong. Adoption could accelerate, and D-Wave's technology could improve faster than I expect, and its annealing approach could find wider commercial use than I assume. But I'm skeptical that its business will grow nearly as quickly as many investors assume.
