IonQ, Inc. Q3 FY2025 earnings call

Key Points

• IonQ delivered record revenues of $39.9 million in Q3 2025, a 222% year-on-year growth and 37% above the high end of revenue guidance.
• Announced the #AQ 64 Tempo system was up and running 3 months ahead of schedule.
• Closed acquisition of Oxford Ionics and raised $1 billion at a 25% premium. Formed IonQ Federal with senior security-cleared personnel.
• Appointed key leaders including Robert Cardillo and General Jay Raymond to the board.
• Demonstrated various quantum advantages and milestones: 99.99% 2-qubit gate fidelity, partnership-driven quantum speed-ups in drug development, and unveiled the Tempo system with significant computational space.
• Acquired Vector Atomic for quantum sensing capabilities, expanding into quantum networking, sensing, and cybersecurity.
• Reiterated leadership in universal gate-based quantum computing, distinguishing from other companies' 'quantum' branding attempts.

In the third quarter, IonQ achieved record revenues of $39.9 million, representing a year-on-year growth of 222%. These revenues exceeded even the high end of the company's own guidance by 37%. The revenue comes from the core quantum computing business as well as the rapidly expanding quantum networking, quantum sensing, and quantum cybersecurity segments. However, specific absolute revenue contributions by each segment and their respective percentages are not explicitly broken down in great detail in the transcript beyond the overall revenue figure and the mention of the platform approach integrating multiple segments.

Financial Guidance

• Increased full-year 2025 revenue guidance to a range of $106 million to $110 million.
• Reaffirmed EBITDA guidance in the range of -$206 million to -$216 million, with the midpoint consistent with prior guidance.
• Anticipated Q4 revenues to be stronger than Q3, breaking prior seasonality.

Risks

• Actual events or results could differ materially from forward-looking statements due to a number of risks and uncertainties. These include those discussed in recent SEC filings such as annual report on Form 10-K and quarterly reports on Form 10-Q. No specific operational failures were deeply discussed in the call beyond general references to risks associated with forward-looking statements.

Q: Congratulations on the nice results and the significant upside to guidance. Can you give a sense how much of the revenue came from core quantum computing vs. security, sensing, and networking?

A: Inder Singh stated that the company is now able to sell integrated solutions, with all products under one roof allowing for a one-stop shop. Momentum continues in quantum computing with the fifth-generation machine and sixth-generation coming next year, and there is great momentum in security, sensing, and networking as well, with solutions being sold instead of individual products.

Q: How do you feel about the DARPA QBI program down selection process and your level of confidence?

A: Dean Kassmann mentioned that the IonQ team, including the Oxford team, has gotten immensely positive feedback from the DARPA team, but they can't say anything yet until DARPA announces the performers moving to Stage B, though they are very happy with the technical work and have received positive technical feedback.

Q: What application areas are most popular presently and for the future?

A: Niccolo de Masi mentioned application areas include power grid optimization, quantum cybersecurity, QKD, sensing for PNT (position navigation timing), and overlap with commercial and government sectors, with solutions being relevant for national security and economic security, and of interest to Fortune 500 companies.

Q: Can you talk about the timing of realizing 3-digit million deals?

A: Inder Singh said that solutions are measured differently than individual products, and they will share more when ready. The nature of the game has changed with the platform approach, and there are multiple opportunities, but specific timing wasn't specified beyond indicating to watch for developments as they occur.