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While Q4 earnings season is nearly over, a few companies still need to report their latest results. In addition to a company’s financials, a quarterly earnings report provides investors with insights into expansion plans, client acquisitions, and other significant business updates. D-Wave (QBTS) is one quantum computing stock set to release its Q4 results next week. So, let’s examine what Wall Street anticipates from QBTS in the December quarter.
Q4 Revenue Is Forecast at $2.23 Million
Analysts monitoring D-Wave stock anticipate that revenue will decline by 23.4% year over year to $2.23 million in Q4 2024, down from $2.91 million in the same period last year. However, the expected losses per share are projected to narrow to $0.06 in Q4, compared to $0.09 last year.
In case D-Wave meets these estimates, it would end 2024 with sales of $8.75 million and a loss per share of $0.32. In 2023, it reported revenue of $8.76 million and loss per share of $0.57. In Q3 of 2024, D-Wave reported revenue of $1.9 million, a decrease of 27% from $2.6 million in the same period last year.
Despite the decline, its core quantum computing as a Service (QCaaS) revenue increased 41% year-over-year to $1.6 million, driven by higher average revenue per customer for its subscription services.
However, professional services revenue fell 80% to $300,000, though D-Wave noted strong bookings in this segment, representing “the second highest quarterly bookings quarter over the last three years.”
In Q3, D-Wave reported a net loss of $22.7 million or $0.11 per share, compared with $16.1 million or $0.12 per share in the year-ago quarter. Comparatively, its adjusted EBITDA loss increased 19% to $13.8 million.
D-Wave paid off its $50 million secured term loan in Q3 and ended the quarter with $30 million in cash. The company also reiterated its fiscal 2024 adjusted EBITDA loss guidance of less than $54.3 million.
What’s Next for D-Wave Computing Stock?
D-Wave, a leader in quantum computing technology, has successfully calibrated its 4,400-qubit Advantage 2 processor, marking a significant advancement toward the commercial release of its sixth-generation annealing quantum computer.
The new processor promises substantial performance improvements over current systems, including double the coherence time, a 40% increase in energy scale, and expanded qubit connectivity from 15 to 20-way, enabling solutions to larger problems across optimization, AI, and material science.
“Annealing quantum computing is the critical accelerant to commercial adoption of quantum technology,” said CEO Alan Baratz.
D-Wave highlighted a major breakthrough with NTT DOCOMO, Japan’s largest wireless carrier with 87 million subscribers. A quantum optimization pilot across three Japanese regions reduced network congestion by 15%. The D-Wave solver completed tasks in 40 seconds compared to 27 hours for classical computing methods. NTT DOCOMO plans to move the quantum solution into production nationwide following successful pilots.
D-Wave also introduced service level agreements (SLAs) for its Leap quantum cloud service, becoming what it claims is the only quantum computing company offering formal SLAs. Over the past two years, D-Wave’s cloud service has consistently exceeded 99.9% availability.
What Is the Target Price for QBTS Stock?
Wall Street expects D-Wave to increase sales from $8.75 million in 2024 to $16.47 million in 2025 and $35 million in 2026. Comparatively, adjusted losses per share are forecast to narrow to $0.23 per share in 2025 and $0.20 per share in 2026.
D-Wave believes it has “the opportunity to be the first independent publicly held quantum computing company to achieve sustained profitability,” requiring substantially less funding than competitors, making it a top investment for those with a sizeable risk appetite.
Of the six analysts covering the tech stock, five recommend “Strong Buy,” and one recommends “Moderate Buy.” The average target price for QBTS stock is $7.67, indicating upside potential of over 50% from current levels.
