Executive Summary

Q4 2024 revenue was $2.3M, down 21% year over year, with GAAP gross margin of 63.8% and record quarterly bookings of $18.3M; net loss per share was $0.37, largely driven by a non-cash warrant remeasurement charge of $68.3M .
Management guided Q1 FY2025 revenue to exceed $10M, with a significant portion from recognition of the Advantage system sale to Jülich; installation/acceptance occurred in Q1, with further revenue tied to an Advantage2 upgrade and multi-year maintenance .
Operating performance mix was a headwind: lower professional services revenue pressured gross profit; adjusted EBITDA loss widened to $15.3M on lower revenue and higher go-to-market/R&D investment .
Strategic catalysts: peer-reviewed quantum supremacy publication in Science, first-ever on-premises system sale to Jülich, and cash balance now above $300M following ATM/ELOC raises and term loan repayment .

What Went Well and What Went Wrong

What Went Well

Record bookings and first system sale: Q4 bookings reached $18.3M (+502% YoY), catalyzed by Jülich’s Advantage system purchase; management sees system sales becoming an important revenue/bookings component going forward .
Technical leadership: peer-reviewed Science paper demonstrating quantum supremacy on a useful materials simulation using Advantage2 prototype, with minutes vs ~1M years on a top classical supercomputer and dramatically lower power consumption .
Liquidity/capitalization: year-end cash $178M; current cash >$300M after ~$307.5M raised via ATMs/ELOC, and $50M term loan repaid, supporting accelerated go-to-market and R&D initiatives .

Management quotes:

“We are proud to be the first in the world to demonstrate quantum supremacy on a useful real-world problem… published in Science on March 12.”
“We now have over $300 million in cash on hand, which we believe is enough to get us to sustained profitability.”
“Margins on our system sales will exceed our consolidated non-GAAP gross margins, which last year were 72.8%.”

What Went Wrong

Revenue decline and margin compression YoY: Q4 revenue fell to $2.3M (-$0.6M YoY) with GAAP gross margin down 390 bps; lower professional services revenue drove the decrease in gross profit/margins .
Profitability: Adjusted EBITDA loss increased to $15.3M (+41% YoY) on lower revenue and increased operating expenses from go-to-market and R&D investment .
Volatile GAAP loss: Net loss spiked to $86.1M due to a $68.3M non-cash warrant liability remeasurement, obscuring underlying operating trends; adjusted net loss was $17.8M .

Analyst concerns:

Bookings-to-revenue conversion cadence and QCaaS run-rate visibility given system-sale timing; management indicated QCaaS bookings were incrementally greater QoQ but did not provide detailed breakdowns .

Financial Results

Metric	Q4 2023	Q3 2024	Q4 2024
Revenue ($USD Millions)	$2.906	$1.900	$2.309
GAAP Gross Profit ($USD Millions)	$2.000	$1.000	$1.473
GAAP Gross Margin (%)	67.7%	55.8%	63.8%
Non-GAAP Gross Profit ($USD Millions)	$2.300	$1.300	$1.686
Non-GAAP Gross Margin (%)	80.2%	67.2%	73.0%
Net Loss per Share (GAAP)	$0.10	$0.11	$0.37
Adjusted Net Loss per Share (Non-GAAP)	$0.10	N/A	$0.08
Adjusted EBITDA Loss ($USD Millions)	$10.896	$13.8	$15.336
Bookings ($USD Millions)	$3.0	$2.3	$18.3

KPIs and Balance Sheet

Cash and cash equivalents ($USD Millions): $41.3 (FY23 YE) → $177.98 (FY24 YE)
Current cash position: >$300M as of press release date
FY 2024 bookings: $23.9M (+128% YoY)
Deferred revenue (current): $18.686M at FY24 YE

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue ($USD Millions)	Q1 FY2025	None prior specific revenue guidance	Exceed $10M; significant portion from Advantage system sale recognition	Raised (new quantitative outlook)
Adjusted EBITDA Loss ($USD Millions)	FY2024	Loss less than FY2023’s $54.3M (reiterated Aug-2024)	Actual: $56.0M (miss vs prior guidance)	Lowered vs guidance (actual above target)

Additional revenue timing notes: Jülich contract includes upgrade option to Advantage2, ongoing maintenance, and Leap/QCaaS access; revenue recognition spans installation/acceptance (Q1 FY2025), upgrade, and multi-year support .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 2024)	Previous Mentions (Q3 2024)	Current Period (Q4 2024)	Trend
AI/Technology initiatives	Announced Quantum AI roadmap; expanded Zapata AI partnership; adding GPUs to Leap for model training and quantum-optimized AI	GenAI pilots: NTT DOCOMO congestion reduction; SLAs and Leap 99.9% availability	Supremacy result in Science; Advantage2 performance (coherence, energy scale, connectivity); multi-chip scaling; gate-model acceleration focus	Accelerating technical leadership; broadening AI applicability
Product performance (Advantage2)	1,200+ and 4,800+ qubit prototypes; FastAnneal feature adoption	4,400-qubit Advantage2 calibration; benchmarking; inbound interest	Third 4,400-qubit Advantage2 calibrated; supremacy achieved on 1,200-qubit proto; 4,400-qubit rollout plans	Strong, moving to commercial rollout
Commercial adoption	9th consecutive QoQ bookings YoY growth; vertical focus (manufacturing, logistics, gov’t)	NTT DOCOMO production path; Tradewinds “awardable” for DoD; Europe interest	First system sale (Jülich); QCaaS bookings incrementally greater QoQ; Leap LaunchPad and Quantum Uplift programs	Expanding channels and modalities (QCaaS + on-prem)
Government/regulatory	Russell 3000 inclusion; gov’t outreach; training growth	DoD Tradewinds awardable; NQI/NDAA context; Europe activity	Carahsoft reseller partnership; supercomputer integration at Jülich/JUPITER	Increasing public sector access
Reliability/SLAs	Leap cloud enhancements; high uptime claims	SLAs; 99.9%+ availability over past 2 years	Continued emphasis on production-grade service and integration	Sustained reliability messaging

Management Commentary

“We believe… only one company that can meet all those criteria right now… D-Wave Quantum.” — Alan Baratz, on Quantum Realized framework .
“The signing of the Jülich deal drove $18.3 million in bookings for Q4 of 2024… We expect our fiscal year 2025 Q1 revenue to exceed $10 million.” — Alan Baratz .
“QCaaS bookings in the fourth quarter… were incrementally greater than they were in the third quarter.” — John Markovich .
“We are looking at introducing a new capability to scale… through multichip… and accelerate gate-model program.” — Alan Baratz .

Q&A Highlights

System sale revenue phasing: installation/acceptance in Q1 drives the >$10M revenue; additional revenue from Advantage2 upgrade and multi-year maintenance/QCaaS access .
Margin mechanics: system sales margins expected to exceed consolidated non-GAAP gross margins (72.8% in FY2024), supportive of mix shift ROI .
Advantage2 commercialization: 4,400-qubit system planned for market, with multi-chip scaling in development; stronger coherence, connectivity, energy scale underpin performance and supremacy .
Go-to-market scaling: larger sales/presales/pro services team in 2025 to accelerate adoption; capital enables faster investment pace .
QCaaS demand: non-system bookings incrementally higher; diversified customer use cases in optimization and AI .

Estimates Context

Wall Street consensus (S&P Global) for EPS/revenue was unavailable at time of writing due to data access limitations; therefore, comparisons to consensus cannot be provided for Q4 2024. Company-reported metrics are used throughout [GetEstimates error].
Implications: Given the >$10M Q1 FY2025 revenue outlook and system-sale revenue recognition, near-term street models may need to shift revenue timing into Q1 with higher gross margin assumptions on system sale contribution .

Key Takeaways for Investors

Bookings inflection and business model expansion: System sales complement QCaaS, with higher expected margins and potential for integration with HPC environments—supportive of ASPs and monetization breadth .
Technical moat: Peer-reviewed supremacy on a useful problem and Advantage2 performance attributes (coherence, energy scale, connectivity) materially differentiate annealing for optimization/materials simulation today .
Near-term revenue visibility: Q1 FY2025 guide >$10M reflects system-sale acceptance; further revenue from Advantage2 upgrade and maintenance provides multi-period tail .
Operating investment vs profit path: Adjusted EBITDA loss widened in Q4 on increased GTM/R&D investment—monitor operating leverage as QCaaS and system sales scale across 2025 .
Liquidity de-risks execution: >$300M cash post ATM/ELOC and term loan paydown enhances optionality to accelerate gate-model, Advantage2 rollout, and sales capacity .
Watch narrative drivers: Additional system sales, Quantum Uplift/LaunchPad adoption, and Advantage2 general availability are likely catalysts for bookings/revenue trajectory .
Risks: Revenue timing from large contracts, reliance on non-GAAP adjustments to parse underlying trends, and potential volatility from warrant liability remeasurement impacting GAAP results .

Appendix: Additional Data Points

Selected FY 2024 (for context)

Revenue: $8.827M (flat YoY) .
GAAP Gross Profit: $5.563M; GAAP Gross Margin: 63.0% (+10.2 pts YoY) .
Non-GAAP Gross Profit: $6.428M; Non-GAAP Gross Margin: 72.8% .
Net Loss: $143.879M; Adjusted Net Loss: $75.634M .
Adjusted EBITDA Loss: $56.016M .
Cash at YE: $177.980M; Deferred revenue (current): $18.686M .

Notes on Q4 revenue drivers

“Lower professional services revenue” was the primary driver of the YoY decline in gross profit/margin; QCaaS revenue partly offset .
System sale booked in Q4 did not generate revenue in Q4; cash was received Q4, with revenue recognition in Q1 and future periods .

D-Wave Quantum Inc. (QBTS)·Q4 2024 Earnings Summary