Celebrate QBTS despite Weak earnings. Huh?
By now, I am certain most of my regular readers would ‘know’ that I think Quantum computing will be the next ‘big’ Tech after AI.
I have in the past, shared posts on stocks like $Rigetti Computing(RGTI)$ and $D-Wave Quantum Inc.(QBTS)$ where I have vested interests.
Click here ! for the most recent.
This post is no exceptions and it’s QBTS’s latest quarterly earnings.
Q1 2026 Earnings.
On Tue, 12 May 2026, QBTS reported its Q1 2026 earnings:
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Earnings per share: Came in at -$0.05 vs analysts’ forecasts of -$0.08 vs Q1 2025’s -$0.02; that’s a -150% YoY dip.
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Revenue: Fell by -$12.1 million to $2.9 million vs Wall Street’s consensus of $4.2 million vs Q1 2025’s $15 million. This is a -81% YoY decrease.
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Net loss : Was -$18.4 million vs Q1 2025’s -$5.4 million; that’s a −240.74% YoY loss in the making. Incidentally, it was ‘smaller’ than estimates.
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Adjusted EBITDA loss: came in at -$32.8 million vs Q1 2025’s -$6.1 million; that’s a -446.67% YoY loss.
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Gross profit : Was just $1.8 million vs Q1 2025’s $13.9 million; that’s a -87% YoY drop.
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Cash & Liquidity: Was $588.4 million vs Q1 2025’s $304.3 million; that’s a +93.3% YoY improvement in liquidity.
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Bookings: Registered as $33.4 million vs Q1 2025’s $1.6 million; that a +1,994% YoY potential earnings.
What To Make Sense Of The Numbers ?
(1). Future revenue visibility.
It is a fact that Q1 2026’s revenue (money in the bank) came in -81% “lower” compared to Q1 2025’s $15 million.
However, for “newly” listed company like QBTS, besides revenue numbers, bookings (refer to customers have committed to spend that amount in the future) are equally, if not, more important.
Simply put, Q1 2026 weak revenue does not mean demand is weak, it means QBTS has not recognized the revenue ($33.4 million) yet.
Think of it like a construction company: contracts are signed today, but revenue only shows up as the work gets completed.
The key takeaway is future income looks strong, even if current revenue looks weak.
(2) High values commercial wins.
QBTS Q1 2026 revenue shortfall was due to the absence of a large, one-time system sales, compared to last year.
The spike in bookings wasn't just small deals; it was driven by 2 major "anchor" clients
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Florida Atlantic University (FAU): A $20 million deal to buy & install a physical quantum computer.
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Fortune 100 Firm: A $10 million, 2-year deal for cloud access to quantum systems.
The deals prove that 2 real-world customers - a major academic institution and a world-leading corporation are willing to spend tens of millions on QBTS’s annealing quantum technology.
In short, big players are starting to trust and use QBTS tech.
It also suggests future revenue growth, overcoming current losses and a volatile, "lumpy" hardware sales cycle.
Afterall, QBTS has long highlighted its roster of commercial clients, a promising sign of demand in an industry often dismissed as aspirational.
QBTS is widely considered the first to have commercialized quantum following a system sale to $Lockheed Martin(LMT)$ back in 2011.
(3) Strategic growth focus.
QBTS is pivoting its business model towards (a) long term contracts and (b) subscription model with Quantum Computing as a Service (QCaaS).
It is strategic and matters because selling a giant computer system for $20 million is great, but it is "lumpy" and happens only once in a blue moon.
By focusing on recurring income stream, QBTS aims for a steady & predictable monthly income, that will make the business more stable & less prone to a "slump", as seen in Q1 2026's revenue.
(4) Acquisition & Expansion.
QBTS known for its "annealing" quantum computers, has in January 2026, acquired a company called Quantum Circuits - that builds error-corrected superconducting gate-based systems..
The acquisition adds "gate-model" systems, a different type of quantum technology, better suited for certain complex mathematical problems - to its stable.
This architecture is favoured by major players like $Alphabet(GOOG)$ and $IBM(IBM)$ and often promoted as suited for a broader range of tasks.
With the acquisition, QBTS is expanding its capabilities:
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Broadening their product offerings.
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Making QBTS more competitive in the quantum space
The cost of acquisition has resulted in QBTS bigger financial losses in Q1 2026.
The good news is QBTS has pledged, to bring superconducting gate-model quantum systems to market in H2 2026.
On Tue, 12 May 2026, the company said it is leveraging its experience in growing systems to turn the “gate-model” technology into a large-scale commercial product that businesses can actually use.
All this is making investors excited because QBTS is now a "dual-platform" company.
Optimistically, QBTS is investing heavily now to grow bigger later.
QBTS has also laid out its product roadmap heading into H2 2026:
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Build a dual-rail system with roughly 175 qubits and create a design for a 1,000-qubit system by the end of 2028.
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Build a 1,000-qubit dual-rail system with 10 logical qubits and create a design for a 10,000-qubit system by 2030.
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Build a dual-rail qubit system that can support 100 logical qubits, that is considered a critical milestone for achieving initial quantum utility, by 2032.
Investors can use these specific goals to track the company's progress and determine if it is staying on schedule or better still exceed them.
(5) Investor Sentiment.
Despite the reported lower revenue and losses, QBTS remained resilient.
In the world of high-tech startups, growth is often more important than immediate profit.
The market is "looking past" the temporary dip in revenue and focusing on the record-breaking backlog.
Stock Price Movement in Perspective.
On Tue, 12 May 2026 post earning QBTS fell by -6.99% to $22.35 /share. (see below)
As of 12 May 2026 end day
Peers $IONQ Inc.(IONQ)$ and $Rigetti Computing(RGTI)$ also saw their stocks dropped by -1.8% and -7%, respectively.
This happened because rising April 2026 inflation data dampened US market sentiments, across the board.
QBTS exhibited volatility throughout the day, hitting a session low near $20.81 before staging a partial recovery in late trading.
Trading volume remained relatively consistent for most of trading session but concluded with a massive surge of selling activity during the final minutes of trading.
While QBTS's stock is down nearly -23% YTD, including a -10.86% loss over Tuesday & Wednesday (inclusive), it's up +2,230.43% since October 2024.
Investors believe the massive increase in future contracted revenue is a more accurate indicator of QBTS’s health than a single slow quarter. I am inclined to agree too. Do you ?
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Do you think the quantum computing is the next phase of IT evolution, after AI ?
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Do you think QBTS is well-positioned to benefit from a subscription-based quantum business ?
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