D-Wave Reports 4th Quarter and Year-End 2023 Results

March 29, 2024

PALO ALTO, Calif. and BURNABY, British Columbia, March 29, 2024 — D-Wave Quantum Inc. (NYSE: QBTS), a leader in commercial quantum computing systems, software, and services, announced financial results for its fourth fiscal quarter and year ended December 31, 2023.

“Our momentum is undeniable,” said Dr. Alan Baratz, CEO of D-Wave. “From our commercial traction to substantive product advancements, from our ground-breaking scientific milestones to new strategic partnerships — we believe all these achievements are propelling us forward to solidify D-Wave’s position as the commercial quantum category builder and leader.”

Fourth Quarter Fiscal 2023 Financial Highlights

  • Revenue: Revenue for the fourth quarter of fiscal 2023 was $2.9 million, an increase of $0.5 million, or 21%, from fiscal 2022 fourth quarter revenue of $2.4 million, and an increase of $0.3 million, or 13%, from the fiscal 2023 third quarter revenue of $2.6 million, representing D-Wave’s third consecutive quarter of sequential quarter-to-quarter growth in revenue.
  • Bookings: Bookings for the fourth quarter of fiscal 2023 were $3.1 million, an increase of $0.8 million, or 34%, from fiscal 2022 fourth quarter Bookings of $2.4 million, and an increase of $0.2 million, or 8%, from the fiscal 2023 third quarter Bookings of $2.9 million, representing D-Wave’s seventh consecutive quarter of year-over-year growth in quarterly Bookings.
  • GAAP Gross Profit: GAAP gross profit for the fourth quarter of fiscal 2023 was $2.0 million, an increase of $0.6 million, or 45%, from fiscal 2022 fourth quarter GAAP gross profit of $1.4 million and an increase of $0.5 million, or 29%, from the fiscal 2023 third quarter GAAP gross profit of $1.5 million. This represents D-Wave’s third consecutive quarter of sequential quarter-to-quarter improvement in GAAP gross profit with the increase due primarily to the growth in revenue.
  • GAAP Gross Margin: GAAP gross margin for the fourth quarter of fiscal 2023 was 7%, an increase of 10.8% from the fiscal 2022 fourth quarter GAAP gross margin of 56.9%, and an increase of 8.0% from the fiscal 2023 third quarter GAAP gross margin of 59.7%, representing D-Wave’s third consecutive quarter of sequential quarter-to-quarter improvement in GAAP gross margin.
  • Non-GAAP Gross Profit: Non-GAAP gross profit for the fourth quarter of fiscal 2023 was $2.3 million, an increase of $0.6 million, or 34%, from fiscal 2022 fourth quarter Non-GAAP gross profit of $1.7 million, and an increase of $0.4 million, or 20%, from the immediately preceding fiscal 2023 third quarter Non-GAAP gross profit of $1.9 million. This represents the third consecutive quarter of sequential quarter-to-quarter improvement in Non-GAAP gross profit with the increase due primarily to the growth in revenue. The difference between GAAP and Non-GAAP gross profit is limited to non-cash stock-based compensation and depreciation expenses that are excluded from Non-GAAP gross profit.
  • Non-GAAP Gross Margin: Non-GAAP gross margin for the fourth quarter of fiscal 2023 was 2%, an increase of 7.6% from the fiscal 2022 fourth quarter Non-GAAP gross margin of 72.6%, and an increase of 4.6% from the fiscal 2023 third quarter Non-GAAP gross margin of 75.6%. This represents D-Wave’s third consecutive quarter of sequential quarter-to-quarter improvement in Non-GAAP gross margin with the increase due primarily to higher revenue. The difference between GAAP and Non-GAAP gross margin is limited to non-cash stock-based compensation and depreciation expenses that are excluded from the Non-GAAP gross margin.
  • GAAP Operating Expenses: GAAP operating expenses for the fourth quarter of fiscal 2023 were $18.5 million, a decrease of $3.8 million, or 17%, from the fiscal 2022 fourth quarter GAAP operating expenses of $22.3 million, and a decrease of $1.4 million, or 7%, from the fiscal 2023 third quarter GAAP operating expenses of $19.9 million. This represents D-Wave’s third consecutive quarter of sequential quarter to quarter decrease in GAAP operating expenses with the decrease driven primarily by lower non-cash stock-based compensation expenses.
  • Non-GAAP Adjusted Operating Expense: Non-GAAP adjusted operating expenses for the fourth quarter of fiscal 2023 were $13.2 million, a decrease of $2.7 million, or 17%, from the fiscal 2022 fourth quarter Non-GAAP adjusted operating expenses of $15.9 million and a decrease of $0.3 million, or 2%, from the fiscal 2023 third quarter Non-GAAP adjusted operating expenses of $13.5 million, representing D-Wave’s third consecutive quarter of sequential quarter-to quarter decrease in Non-GAAP adjusted operating expenses. The difference between GAAP and Non-GAAP adjusted operating expenses is limited to non-cash stock-based compensation and depreciation expenses that are excluded from the Non-GAAP adjusted operating expenses.
  • Net Loss: Net Loss for the fourth quarter of fiscal 2023 was $16.0 million, or $0.10 per share, a decrease of $2.2 million, or 12%, from the fiscal 2022 fourth quarter net loss of $18.2 million, and a decrease of $0.1 million, or 1%, from the fiscal 2023 third quarter net loss of $16.1 million, representing D-Wave’s second consecutive quarter of sequential quarter-to-quarter improvement in net loss with the improvement driven by higher gross profit in combination with lower operating expenses.
  • Adjusted EBITDA Loss: Adjusted EBITDA loss for the fourth quarter of fiscal 2023 was $10.9 million, a decrease of $3.5 million, or 24%, from the fiscal 2022 fourth quarter adjusted EBITDA loss of $14.4 million, and a decrease of $0.7 million, or 6%, from the immediately preceding fiscal 2023 third quarter adjusted EBITDA loss of $11.6 million, representing the third consecutive quarter of sequential quarter-to-quarter improvement in adjusted EBITDA loss.

Financial Results for the Fiscal Year 2023

  • Revenue: Revenue for fiscal 2023 was $8.8 million, an increase of $1.6 million, or 22%, from revenue of $7.2 million in fiscal 2022.
  • Customers: In comparing fiscal 2023 with fiscal 2022, D-Wave had:
    • A total of 133 customers compared with a total of 120 customers;
    • 78 commercial customers compared with 74 commercial customers; and
    • 27 Forbes Global 2000 customers compared with 24 Forbes Global 2000 customers.
  • Commercial Traction: In comparing fiscal 2023 with fiscal 2022:
    • Revenue from commercial customers increased by $1.8 million, or 41%;
    • Commercial revenue as a percentage of total revenue increased from 60% to 70%:
    • Revenue from Forbes Global 2000 customers increased by $0.4 million, or 20% and comprised 26.1% of total revenue.
  • Bookings: Fiscal 2023 Bookings were $11.5 million, an increase of $5.4 million, or 89%, from fiscal 2022 Bookings of $6.1 million.
  • GAAP Gross Profit: Fiscal 2023 GAAP gross profit was $4.6 million, an increase of $0.4 million, or 9%, from fiscal 2022 GAAP gross profit of $4.3 million with the improvement due primarily to higher revenue.
  • GAAP Gross Margin: Fiscal 2023 GAAP gross margin was 8%, a decrease of 6.5% from fiscal 2022GAAP gross margin of 59.2% with the decrease due primarily to higher non-cash, stock-based compensation expenses in fiscal 2023 cost of sales when compared to fiscal 2022 cost of sales.
  • Non-GAAP Gross Profit: Fiscal 2023 Non-GAAP gross profit was $6.1 million, an increase of $1.3 million, or 27%, from fiscal 2022 Non-GAAP gross profit of $4.8 million with the improvement due primarily to higher revenue.
  • Non-GAAP Gross Margin: Fiscal 2023 Non-GAAP gross margin was 8%, an increase of 2.5% from fiscal 2022 Non-GAAP gross margin of 67.3% The difference between GAAP and Non-GAAP gross profit and margin is limited to non-cash stock-based compensation and depreciation expenses that are excluded from the Non-GAAP gross profit and margin.
  • GAAP Operating Expenses: Fiscal 2023 GAAP operating expenses were $85.2 million compared with fiscal 2022 GAAP operating expenses of $63.7 million with the $21.5 million year-over-year increase comprised of $11.5 million in non-cash, stock-based compensation expense, $5.3 million in public company related costs, $3.4 million in salaries and other personnel related costs and $1.5 million in research and development fabrication costs.
  • Non-GAAP Adjusted Operating Expense: Fiscal 2023 Non-GAAP adjusted operating expenses were $60.4 million, an increase of $8.0 million, or 15% from fiscal 2022 Non-GAAP adjusted operating expenses of $52.4 million with the increase primarily comprised of $3.4 million in personnel related costs, $2.8 millionin public company related costs and $1.5 million in research and development fabrication costs. The difference between GAAP and Non-GAAP adjusted operating expenses being primarily non-cash stock-based compensation expense, non-recurring one-time expenses, and amortization and depreciation expense.
  • Net Loss: Fiscal 2023 net loss was $82.7 million, or $0.60 per share, compared with fiscal 2022 net loss of $53.7 million, or $0.45 per share.
  • Adjusted EBITDA Loss: Fiscal 2023 adjusted EBITDA loss was $54.3 million, compared with $48.0 millionin fiscal 2022, with the increase due primarily to higher public company and headcount-related expenses.

Balance Sheet and Liquidity

As of December 31, 2023, D-Wave’s consolidated cash balance totaled $41.3 million, an increase of $34.2 million, or 485%, from the December 31, 2022 consolidated cash balance of $7.1 million.

During fiscal 2023, D-Wave raised $98.1 million in capital, including $66.1 million in equity, primarily under the Company’s common stock purchase agreement (“Equity Line of Credit” or “ELOC”) with Lincoln Park Capital Fund, LLC (“Lincoln Park”), and $32.0 million in debt, primarily under the Company’s $50 million four-year term loan agreement with PSPIB Unitas Investments II Inc., an affiliate of PSP Investments. As of December 31, 2023, D-Wave has $82.1 million in remaining capacity under the Lincoln Park ELOC commitment that terminates in October 2025. D-Wave’s ability to raise funds under the ELOC is subject to a number of conditions including having a sufficient number of registered shares and having D-Wave’s stock price above $1.00 per share.

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. 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 has been used by some of the world’s most advanced organizations, including 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.


Source: D-Wave

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