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D-Wave Earnings Looked Weak, But Investors May Be Missing ThisAuthor: Nathan Reiff. First Published: 5/13/2026. 
Key Points
- D-Wave shares fell about 7% in a single day following a seemingly disappointing earnings report including news of an 80% YOY decline to revenue.
- Still, bookings were up considerably, with growing QCaaS revenue as a standout.
- D-Wave's performance stands in stark contrast to Rigetti Computing, which saw revenue roughly triple YOY in the first quarter.
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Earnings season is a pivotal moment for many stocks, especially for companies in an emerging industry like quantum computing. When major player IonQ Inc. (NYSE: IONQ) reported its first-quarter 2026 results in early May, investors took note of promising revenue growth, an increase to full-year guidance relative to prior projections, and a strong showing in both partnerships and system sales. Still, a crucial piece of the puzzle—profitability—remains missing. Now, other big names in the pure-play quantum space are sharing their own results, including firms like D-Wave Quantum Inc. (NYSE: QBTS) and Rigetti Computing (NASDAQ: RGTI). D-Wave, known for its sizable cash holdings and recent purchase of Quantum Circuits Inc., stands out for its dual focus on two distinct technological approaches to quantum computing.
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Like IonQ, the company highlighted several compelling developments in its Q1 2026 earnings, particularly in bookings, sales pipeline, and technological progress. However, top- and bottom-line performance may have contributed to a post-earnings selloff that pushed the share price down 7% on May 12, reversing the recent mini-rally that began in April. The Bright Spots in D-Wave's Earnings: Bookings, Recurring Revenue, Sales Pipeline, and MoreA number of highlights emerge from a closer look at D-Wave's first quarter of the new year. Notably, quarterly bookings reached $33.4 million, a Q1 record and a massive increase of about 2,000% year-over-year (YOY). This figure is impressive on its own, but one of the real strengths here is D-Wave's major growth in its quantum-computing-as-a-service (QCaaS) business, which climbed 15% YOY to $1.8 million in revenue. QCaaS positions D-Wave to build recurring revenue into its business model, which could be crucial in its efforts to achieve sustainable profitability. A $10 million enterprise QCaaS agreement from Q1 was a major driver here. The company's sales pipeline is also shining, with growth of more than 100% sequentially in Q1 2026. D-Wave sees system sales—the lion's share of its revenue so far—totaling two or three per year going forward, with at least two projected for 2026. These big-ticket sales do not necessarily create recurring revenue, but they still vastly outsize other revenue streams for the firm at this point. Technological advances are also crucial for any quantum computing company, and D-Wave highlighted some important ones for the first three months of the year. A standout achievement for the company is its roadmap to 100 logical qubits, a major technological breakthrough that it believes can be achieved by 2032. Finally, investors have been waiting for signs that D-Wave has been able to maintain its historically strong cash position. With more than $588 million in cash and equivalents at the end of the quarter, the company's reserves remain healthy. The Reason for the Share Price DeclineIt's difficult for D-Wave to avoid negative headlines about its top- and bottom-line performance in the quarter, despite all of the successes above. Notably, revenue of $2.9 million was down more than 80% YOY and came in about $1.3 million below analyst expectations. Though losses per share beat estimates by 3 cents, they nevertheless widened by 3 cents relative to the prior-year quarter. A closer look may give long-term D-Wave investors some comfort. Part of the reason for the seemingly massive revenue slippage is that Q1 of last year included the sale of a quantum annealing computer system for nearly $13 million. A single transaction can have a major impact on revenue performance, particularly when overall revenue is so low. Still, the fact that D-Wave is so susceptible to these significant shifts based on the timing of an individual system sale reflects how reliant the company has been on these one-off deals. Investors will surely be happy to see the company move toward a more predictable, consistent revenue stream. Investors in the quantum computing space will need to decide whether D-Wave remains an attractive option based on its performance relative to its peers. For one thing, Rigetti announced on the same day that its Q1 2026 revenue roughly tripled YOY to $4.4 million. The path toward profitability may have become somewhat clearer based on QCaaS performance, but widening losses and the sizable gap between expected revenue and actual results suggest there may still be significant ground to cover. D-Wave shares remain a Moderate Buy, with 14 out of 17 analysts bullish on the stock. |
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