Executive Summary

Record Q1 revenue of $15.0M, up 509% YoY, driven primarily by D‑Wave’s first Advantage system sale; GAAP gross margin surged to 92.5% and GAAP gross profit to $13.9M as mix shifted to a high‑margin system sale .
Results beat S&P Global consensus: revenue $15.0M vs $10.5M*, EPS $(0.02) vs $(0.036)*; strong operational performance but with lumpy mix (bookings down 64% YoY to $1.6M) .
Liquidity inflected: quarter‑end cash hit a record $304.3M after $146.2M raised in Q1 via ATM; management believes cash is sufficient to reach profitability .
Strategic catalysts: Advantage2 general availability targeted by end of Q2, expanded system‑sale pipeline (pricing discussed publicly at $20–$40M; long sales cycles), and new quantum+AI/blockchain research avenues that could favor on‑prem systems .

What Went Well and What Went Wrong

What Went Well
- System sale unlocked step‑function revenue and margin: ~$12.6M of Q1 revenue from the Jülich Advantage system, with consolidated GAAP gross margin at 92.5% and adjusted EBITDA loss roughly halved YoY to $(6.1)M .
- Balance sheet strength: Q1 cash of $304.3M (record), after $146.2M raised in the quarter; management reiterated cash is sufficient to reach profitability .
- Technology momentum: management emphasized first peer‑reviewed “quantum supremacy” on a useful real‑world problem and Advantage2 milestones (fast anneal, error mitigation), with GA expected by end of Q2; quote: “The first quarter of 2025 was arguably the most significant in D‑Wave’s history…” .
What Went Wrong
- Demand leading indicators softened: bookings fell 64% YoY to $1.6M; professional services drove over 50% of bookings, signaling pipeline still in on‑ramp stages .
- Deferred revenue stepped down: total deferred revenue fell from $19.4M at 12/31/24 to $6.2M at 3/31/25 as Q4 bookings converted; highlights revenue lumpiness tied to system sale timing .
- U.S. government adoption remains slow versus international interest; management reiterated a domestic “gate‑model bias,” though tone is “hopeful” under the new administration .

Financial Results

Income statement and profitability vs prior quarters

Metric	Q3 2024	Q4 2024	Q1 2025
Revenue ($M)	$1.9	$2.3	$15.0
GAAP Gross Profit ($M)	$1.0	$1.5	$13.9
GAAP Gross Margin (%)	55.8%	63.8%	92.5%
Net Loss per Share (GAAP)	$(0.11)	$(0.37)	$(0.02)
Adjusted EBITDA Loss (Non‑GAAP, $M)	$(13.8)	$(15.3)	$(6.1)

Q1 2025 vs S&P Global consensus

Metric	Actual (Q1 2025)	Consensus (Q1 2025)
Revenue ($M)	$15.001	$10.501*
Primary EPS ($)	$(0.02)	$(0.036)*
# of Estimates (Revenue / EPS)	—	6 / 5*

Values marked with * retrieved from S&P Global.

Revenue mix (Q1 2025)

Component	Q1 2025
System sale (Advantage to Jülich)	≈$12.6M (of $15.0M)
QCaaS + Professional Services	≈$2.4M (balance)

KPIs and operating metrics

KPI	Q3 2024	Q4 2024	Q1 2025
Bookings ($M)	$2.3	$18.3	$1.6
Customers (LTM count)	—	—	133 (69 commercial; 25 Forbes G2K)
Cash & Cash Equivalents ($M)	—	$178.0 (12/31/24)	$304.3 (3/31/25)
Deferred Revenue (Total, $M)	—	$19.4 (12/31/24)	$6.2 (3/31/25)
GAAP Operating Expenses ($M)	—	—	$25.2
Non‑GAAP Adjusted OpEx ($M)	—	—	$20.2

Notes: Non‑GAAP definitions per company exclude SBC, D&A and certain non‑recurring/non‑operating items .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance/Actual	Change
Revenue	Q1 2025	“Revenue to exceed $10M” (3/13/25)	Actual $15.0M	Exceeded

No formal quantitative guidance for Q2/FY was provided in the Q1 materials .

Earnings Call Themes & Trends

Topic	Q3 2024 (Q‑2)	Q4 2024 (Q‑1)	Q1 2025 (Current)	Trend
AI/technology initiatives	Quantum AI explorations (RBMs, transformers/diffusion), hybrid solver upgrades; Leap SLAs 99.9% availability	Advantage2 calibration (4,400 qubits) and supremacy preprint; AI model training concepts discussed	Advantage2 GA by end of Q2; error mitigation (~10x effective coherence on certain problems); open‑source ML toolkit	Broadening scope; nearing commercial GA
Product performance	Advantage2 coherence/connectivity/energy‑scale benefits vs Advantage	Supremacy published in Science; 3rd 4,400‑qubit CPU calibrated	System install at Davidson (Advantage2), fast anneal feature, solver advancements	Strong momentum
Commercialization/system sales	Building pipeline; NTT DOCOMO production path	First system sale to Jülich; Q1 revenue guide >$10M	~$12.6M of Q1 from Jülich system; pipeline interest; system pricing $20–$40M (long cycles)	System‑sale model emerging
Government & regulatory	Tradewinds “awardable” DoD marketplace; Europe interest	Expect more near‑term interest outside U.S.; NQI reauth pending	U.S. remains gate‑biased; tone “hopeful” post administration change	Gradual progress
Customer production apps	NTT DOCOMO pilot (15% congestion reduction) and production plans	Pipeline broadening; multiple POCs	Ford Otosan in production; more apps expected to enter production in 2025	Expanding
R&D execution	Advantage2 and patent/IP positioning	Multichip scaling path; accelerated gate‑model R&D considered	Advantage2 GA timing; error mitigation and fast anneal	On track/accelerating

Management Commentary

“The first quarter of 2025 was arguably the most significant in D-Wave’s history… The end result was a record revenue and gross profit quarter.” — CEO Alan Baratz, press release .
“Our Q1 revenue came in at a record $15 million, and we closed the quarter with a record $304 million in cash, giving us a very solid cash position that we believe is sufficient for us to reach profitability.” — CEO .
On Advantage2: “We have completed calibration and benchmarking of several 4400+ qubit Advantage2 quantum processors… with doubled coherence time… 40% increase in energy scale… increased qubit connectivity from 15 to 20 way…” — CEO .
On blockchain research: quantum proof‑of‑work could “reduce electricity costs by up to a factor of 1,000” — CEO; also highlighted potential partnership approach .
CFO: “Adjusted EBITDA loss for the first quarter was $6.1 million… decrease of 53%… due primarily to the year-over-year increase in revenue… partially offset by higher operating expenses.” .

Q&A Highlights

System sales pipeline and economics: Davidson installation is separate from the “handful” of system‑sale opportunities; economics undisclosed; strong global (ex‑U.S.) interest; U.S. bias remains a headwind .
Margin framework: system sales should carry higher gross margins than QCaaS (70–80% range); Q1’s 93.6% non‑GAAP GM is a directional proxy but deal‑dependent — CFO .
Advantage/Advantage2 clarification: Jülich’s system is Advantage with an option to upgrade; Davidson’s is Advantage2 from the outset — CEO .
Revenue per customer trends: average revenue per commercial and government customer increased over the last two sequential quarters — CFO .
Profitability: management reiterated funded to profitability, but did not quantify revenue run‑rate or timing — CFO .

Estimates Context

Q1 2025 beats: Revenue $15.0M vs $10.5M*; EPS $(0.02) vs $(0.036)*; implies significant top‑line and per‑share upside vs consensus, primarily on a high‑margin system sale .
Estimate breadth: 6 revenue and 5 EPS estimates for Q1; forward quarters (Q3–Q4’25, Q1–Q2’26) imply modest sequential growth from a normalized base, with ongoing operating losses expected by consensus* (context only) [GetEstimates; see tables above].