D-Wave Quantum Inc. (NYSE: QBTS) (“D-Wave” or the “Company”), a
leader in commercial quantum computing systems, software, and
services, today announced select unaudited preliminary financial
results for its fiscal second quarter ended June 30, 2023. All
references in this press release related to revenue and bookings
are approximate and estimated due to the preliminary nature of the
announcement and are subject to normal quarter-end accounting
review.
2023 Second Quarter Preliminary
Revenue
Preliminary fiscal second quarter revenue is expected to be in a
range of $1,650,000 to $1,800,000 compared with the FactSet analyst
consensus estimate of $2,281,000 with the shortfall due primarily
to the timing of revenue recognition on certain professional
services contracts. As the Company outlined in its earnings release
for its first fiscal quarter ended March 31, 2023, the timing of
revenue recognition associated with its professional services
contracts may vary from period to period. However, D-Wave is
generally paid in advance of the completion of its professional
services engagements and the corresponding revenue recognition
timeframe.
2023 Second Quarter and First Half
Bookings
Total bookings[1] for the fiscal second quarter ended
June 30, 2023, were $2.5 million, an increase of $1.5 million, or
146%, from bookings of $1.0 million in the fiscal second quarter
ended June 30, 2022. This represents D-Wave’s fifth consecutive
quarter of year-over-year growth in bookings. For the first six
months of fiscal 2023, bookings totaled $5.4 million, an increase
of $3.7 million, or 209%, from bookings of $1.8 million in the
first six months of fiscal 2022. During the first half of the year,
D-Wave signed new and/or expanded agreements with customers
including Interpublic Group, Unisys Corporation, and VINCI
Energies.
2023 Second Quarter and First Half
Average Deal Sizes
During the fiscal second quarter ended June 30, 2023, D-Wave’s
average deal size[2] increased
by 136% when compared to the fiscal second quarter ended June 30,
2022. For the first six months of fiscal 2023, D-Wave’s average
deal size increased by 252% when compared to the first six months
of fiscal 2022.
Balance Sheet and
Liquidity
On July 13, 2023, D-Wave closed the second $15 million tranche
of its $50 million four-year term loan with PSPIB Unitas
Investments II Inc., an affiliate of PSP Investments, which brings
the total advances received under the loan to $30 million. In
addition, the loan agreement has been amended to eliminate the
mandatory prepayment of the loans outstanding with respect to
issuance of common stock under the ELOC up to $50 million if issued
prior to October 18, 2023. However, there can be no assurances that
the Company will be able to meet the conditions necessary to draw
on the third tranche.
Fiscal Year 2023 Outlook
Update
As a result primarily of the timing of revenue recognition
associated with professional services contracts, as well as current
market conditions, we are updating the full year 2023 guidance
provided in our 2023 first quarter earnings release dated May 19,
2023. Our guidance is subject to various cautionary factors
described below. Based on the information available on July 20,
2023, guidance for the full year 2023 is as follows:
- We expect the fiscal 2023 revenue to be in a range of $11
million to $13 million.
- We expect the fiscal 2023 Adjusted EBITDA[3] to be less than
negative $58 million.
“We believe that enterprise adoption of quantum computing is
accelerating, as evidenced by our year-over-year and YTD uptick and
growth in bookings. We’re seeing an increased appetite for our
quantum solutions by companies from all sectors – technology, life
sciences, media and advertising, energy, just to name a few –
recognizing the value our annealing quantum computing solutions can
bring to solving tough business challenges and fueling operational
excellence today,” said Dr. Alan Baratz, CEO of D-Wave. “On top of
our commercial momentum, we’re also encouraged by the flurry of US
legislative proposals we believe are designed to quicken the
adoption of near-term quantum computing solutions. As the first
commercial quantum computing company, we believe that D-Wave is
well-positioned to support both public and private sectors with our
cloud-based, commercial-grade, and production-ready quantum
solutions.”
We are providing bookings, average deal size and Adjusted EBITDA
as we believe these metrics improve investors’ ability to evaluate
our underlying performance. Non-GAAP and operating measures do not
have any standardized meaning under GAAP, and therefore may not be
comparable to similar measures employed by other companies.
- “Bookings” is an operating measure that is defined as customer
orders received that are expected to generate net revenues in the
future. We present the operational metric of bookings because it
reflects customers' demand for our products and services and to
assist readers in analyzing our performance in future period.
- “Average deal size” is an operating measure that is defined as
both QCaaS and professional services bookings.
- Adjusted EBITDA is a non-GAAP financial measure. For a
description of Adjusted EBITDA, refer to “Non-GAAP Financial
Measures” below.
We are not able to reconcile guidance for Adjusted EBITDA to its
most directly comparable GAAP measure, net loss, and cannot provide
an estimated range of net loss for such period without unreasonable
efforts because certain items that impact net loss, including
foreign exchange and stock-based compensation, are not within our
control or cannot be reasonably predicted.
Second Quarter 2023 Conference Call
In conjunction with this announcement, D-Wave will host a
conference call on Thursday, August 10, 2023, at 4:30 p.m. (Eastern
Time), to discuss such financial results and its business outlook.
The live dial-in number is 1-888-999-5318 (domestic) or
1-848-280-6460 (international), conference ID code 13738032. A live
webcast and subsequent replay of the call will also be available on
the “Investors” page of the Company’s website at:
http://ir.dwavesys.com/
Financial Disclosure Advisory
The Company has not yet completed its reporting process for its
2023 second fiscal quarter ended June 30, 2023. The preliminary
results presented herein are based on its reasonable estimates and
the information available to it as of the date hereof and, because
of their preliminary nature, in certain cases, the Company has
provided ranges, rather than specific amounts. As such, the
company's actual results may materially vary from the preliminary
results presented herein and will not be finalized until the
company reports its final results for second quarter fiscal 2023
after the completion of its normal quarter end accounting
procedures including the execution of its internal controls over
financial reporting. In addition, any statements regarding the
company's estimated financial performance for the second quarter of
fiscal 2023 do not present all information necessary for an
understanding of the company's financial condition and results of
operations as of and for the quarterly period ended June 30,
2023.
About D-Wave Quantum Inc.
D-Wave is a leader in the development and delivery of quantum
computing systems, software, and services, and is the world’s first
commercial supplier of quantum computers—and the only company
building both annealing quantum computers and gate-model quantum
computers. Our mission is to unlock the power of quantum computing
today to benefit business and society. We do this by delivering
customer value with practical quantum applications for problems as
diverse as logistics, artificial intelligence, materials sciences,
drug discovery, scheduling, cybersecurity, fault detection, and
financial modeling. D-Wave’s technology is being used by some of
the world’s most advanced organizations, including Volkswagen,
Mastercard, Deloitte, Davidson Technologies, ArcelorMittal, Siemens
Healthineers, Unisys, NEC Corporation, Pattison Food Group Ltd.,
DENSO, Lockheed Martin, Forschungszentrum Jülich, University of
Southern California, and Los Alamos National Laboratory.
Non-GAAP Financial Measures
To supplement the financial information presented in accordance
with GAAP, we use non-GAAP measures of certain components of
financial performance. Adjusted EBITDA is a financial measure that
is not required by or presented in accordance with GAAP. Management
believes that such measure provides investors an additional
meaningful method to evaluate certain aspects of such results
period over period. Adjusted EBITDA is defined as net loss before
interest expense, income tax expense (benefit), depreciation and
amortization expense, stock-based compensation, remeasurements of
liability-classified warrants, and other nonrecurring nonoperating
income and expenses. We use Adjusted EBITDA to measure the
operating performance of our business, excluding specifically
identified items that we do not believe directly reflect our core
operations and may not be indicative of our recurring operations.
The presentation of non-GAAP financial measures is not meant to be
considered in isolation or as a substitute for the financial
results prepared in accordance with GAAP, and our presentation of
non-GAAP measures may be different from non-GAAP measures used by
other companies.
Forward-Looking Statements
Certain statements in this press release are forward-looking, as
defined in the Private Securities Litigation Reform Act of 1995.
These statements involve risks, uncertainties, and other factors
that may cause actual results to differ materially from the
information expressed or implied by these forward-looking
statements and may not be indicative of future results.
Forward-looking statements in this press release include, but are
not limited to, statements regarding actual results for the second
fiscal quarter ended June 30, 2023, D-Wave’s payment in advance of
professional service contracts, full-year 2023 guidance and third
quarter revenue guidance, and customer demand for D-Wave products.
These forward-looking statements are subject to a number of risks
and uncertainties, including, among others, the variability of
professional service revenues; profitability of new customer
contracts; D-Wave’s ability to draw on the third tranche of the
term loan with PSPIB Unitas Investments II Inc.; general economic
conditions and other risks; our ability to expand our customer base
and the customer adoption of our solutions; risks within D-Wave’s
industry, including anticipated trends, growth rates, and
challenges in those businesses and the markets in which they
operate; the outcome of any legal proceedings that may be
instituted against us; risks related to the performance of our
business and the timing of expected business or financial
milestones; unanticipated technological or project development
challenges, including with respect to the cost and or timing
thereof; the performance of our products; the effects of
competition on our business; the risk that we will need to raise
additional capital to execute our business plan, which may not be
available on acceptable terms or at all; the risk that we may never
achieve or sustain profitability; the risk that we are unable to
secure or protect our intellectual property; volatility in the
price of our securities; and the numerous other factors set forth
in D-Wave’s Annual Report on Form 10-K for its fiscal year ended
December 31, 2022 and other filings with the Securities and
Exchange Commission. Undue reliance should not be placed on the
forward-looking statements in this press release, which are based
on information available to us on the date hereof. We undertake no
duty to update this information unless required by law.
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version on businesswire.com: https://www.businesswire.com/news/home/20230720847980/en/
Investor Contact: Kevin Hunt ir@dwavesys.com
Media Contact: Amy McDowell media@dwavesys.com
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