D-Wave Quantum Inc. Q2 FY2025 earnings call

• Technical achievements: Announced general availability of Advantage2 quantum computer, a new cryogenic packaging initiative leveraging NASA JPL expertise, and developer tools for quantum AI including an open source toolkit integrating with PyTorch.
• Commercial updates: Signed new customer engagements with companies like E.ON, GE Vernova, and universities; completed proof of concepts for aerospace and law enforcement use cases; growing interest in Leap Quantum LaunchPad program.
• Financial position: Strong cash position with $819.3 million as of June 30, 2025, from equity raises and warrant exercises.

In the second quarter of fiscal 2025, revenue totaled $3.1 million, an increase from $2.2 million in Q2 2024. Bookings for Q2 were $1.3 million, up from $700,000 in Q2 2024. GAAP gross profit for Q2 was $2 million, up from $1.4 million in Q2 2024. Non-GAAP gross profit for Q2 was $2.2 million, up from $1.6 million in Q2 2024. For the first half of fiscal 2025, revenue was $18.1 million, up from $4.6 million in H1 2024. Bookings for H1 2025 were $2.9 million, down from $3.3 million in H1 2024. GAAP gross profit for H1 2025 was $15.9 million, up from $3 million in H1 2024. Non-GAAP gross profit for H1 2025 was $16.3 million, up from $3.5 million in H1 2024.

With $800 million in cash, M&A is a strategic priority. Plan to accelerate R&D, sales/marketing, and G&A investments. Q3 non-GAAP OpEx expected to be ~15% higher than Q2. Goal to announce acquisitions this year.

• Challenges in closing deals with large enterprises due to complex procurement processes.
• DARPA's focus on gate model quantum computing potentially missing the importance of annealing quantum computing for certain optimization problems.

Q: Congratulations on the results in the quarter and technical progress, guys. I wanted to start by following up on the point the company had made about M&A and understand the types of M&A that the company believes would make sense...

A: Craig, thanks for the question. So we have not disclosed our strategy and plans for M&A other than to say that with $800 million in the bank, it has now become a strategic priority for the company. That having been said, over the course of the last several months, we have been spending a fair amount of time developing a strategy and a plan. And it falls into a number of key areas, including some of those that you mentioned. But think about it as really accelerating our R&D and product development activities in a number of key areas, which could be everything from gate model to quantum AI.

Q: Congrats on the continued progress here. So maybe if you could speak to the cryogenic news and the importance of that towards your road map and what you think it will bring ultimately as you get that ramped into the road map?

A: Yes, David, thank you. This is really important to us. So we've talked in the past about how we have significant intellectual property and a real lead in cryogenic control. And by that, I mean the ability to control qubits and control our systems on chip rather than needing to do all the control from room temperature. And now as we are looking to leverage that into the gate model program as well as expanding our annealing processes to much larger numbers of qubits, as we said, 100,000 qubits, we really need to be moving to a multichip solution. And when we start interconnecting chips together in the refrigerator, we need to make sure that, that interconnect is also superconducting and that we can preserve the quantum properties like entanglement across those interconnects. And so this is key to both scaling our annealing systems as well as developing our gate model systems. And frankly, we made progress in this area much faster than we actually expected it to. The NASA Jet Propulsion Laboratory had some capabilities that we thought looked interesting. We thought it would take a while to get to the point where we could actually kind of evolve that into what we needed. But it actually moved a lot faster than we thought. And so now we're really starting to build a production capability around that technology to more rapidly drive the multichip annealing processes as well as the gate model system.