Financial Data and Key Metrics Changes - Revenue for Q2 2025 totaled approximately $0.061 million, a decrease from $0.183 million in the same quarter of the previous year [15] - Gross margin increased to 43% from 32% year-over-year, although it remains variable at current revenue levels [15] - Net loss attributable to common stockholders was $36 million for Q2 2025, compared to a net loss of $5 million in Q2 2024 [17] - Total assets increased to $426 million as of June 30, 2025, up from $154 million at the end of 2024 [18] - Cash and equivalents rose by $270 million in the first half of 2025 to $349 million, bolstered by net proceeds of $188 million raised in Q2 [18] - Total liabilities decreased to $30 million, down approximately $16 million compared to year-end 2024 [19] - Stockholders' equity rose to $396 million as of June 30, 2025, reflecting a strengthened capital position [19] Business Line Data and Key Metrics Changes - The company is focused on two revenue streams: quantum machines for complex optimization and a photonic chip foundry for next-generation communication [5] - Significant orders were secured for quantum photonic systems and entangled photon sources, indicating growing commercial adoption [8][9] - A major automotive manufacturer purchased an EMUCORE reservoir computing system, showcasing real-world applications of the technology [10] Market Data and Key Metrics Changes - The company is positioned in a rapidly accelerating market for quantum technologies, with increasing awareness of their role in various sectors [6] - The domestic semiconductor and photonic manufacturing momentum is creating new commercial opportunities for the foundry [6] Company Strategy and Development Direction - The growth strategy is centered on delivering practical, high-performance quantum and photonic technologies rather than theoretical performance [5] - The company aims to integrate quantum machines with nanophotonic chips to enhance performance and reduce costs [23] - The foundry is expected to support both the development of quantum machines and offer services to other companies [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's progress and the potential of its technologies to deliver real-world solutions [20] - The focus for the next two to three years will be on integrating quantum machines with nanophotonic chips to enhance performance [23] Other Important Information - The company completed a $200 million financing round, strengthening its capital position [16] - Key leadership appointments were made to support the next phase of execution, including a new CFO and COO [13] - The company was added to the Russell 3000 and Russell 2000 indices, increasing visibility among institutional investors [14] Q&A Session Summary Question: What are the most important milestones for the next one to three years? - Management highlighted the integration of quantum machines with nanophotonic chips as a key focus, aiming to enhance performance and reduce costs [23] Question: Will there be an acceleration in spending or M&A activities? - The CFO indicated that while they are hiring additional staff to accelerate technology development, there are no current plans for acquisitions, although strategic opportunities are being explored [27][28]

PART I. FINANCIAL INFORMATION [Item 1. Condensed Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, including the balance sheets, statements of operations, statements of mezzanine and stockholders' equity, and statements of cash flows, along with their accompanying notes, providing a snapshot of the company's financial position and performance for the periods ended June 30, 2025 and December 31, 2024 [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows a significant increase in total assets, primarily driven by a substantial rise in cash and cash equivalents, while total liabilities decreased due to a reduction in derivative liability, and stockholders' equity also saw a considerable increase | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change (in thousands) | % Change | | :----------------------------- | :----------------------------- | :------------------------------- | :-------------------- | :------- | | Cash and cash equivalents | $348,758 | $78,945 | $269,813 | 341.8% | | Total current assets | $350,225 | $79,151 | $271,074 | 342.5% | | Total assets | $426,084 | $153,559 | $272,525 | 177.5% | | Total current liabilities | $3,972 | $4,559 | $(587) | -12.9% | | Derivative liability | $24,594 | $40,532 | $(15,938) | -39.3% | | Total liabilities | $30,102 | $46,272 | $(16,170) | -34.9% | | Total shareholders' equity | $395,982 | $107,287 | $288,695 | 269.1% | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The company experienced a significant increase in net loss for both the three and six months ended June 30, 2025, primarily driven by a substantial change in the fair value of derivative liability and increased operating expenses, despite a decrease in total revenue | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total revenue | $61 | $183 | $100 | $210 | | Gross profit | $26 | $58 | $39 | $69 | | Total operating expenses | $10,197 | $5,325 | $18,496 | $11,654 | | Loss from operations | $(10,171) | $(5,267) | $(18,457) | $(11,585) | | Change in fair value of derivative liability | $(28,096) | $- | $(4,466) | $- | | Net loss attributable to common stockholders | $(36,482) | $(5,194) | $(19,500) | $(11,630) | | Basic Loss per share | $(0.26) | $(0.06) | $(0.14) | $(0.13) | [Condensed Consolidated Statements of Mezzanine and Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Mezzanine%20and%20Stockholders%27%20Equity) The company's stockholders' equity significantly increased during the six months ended June 30, 2025, primarily due to substantial proceeds from the issuance of shares for cash and the exercise of warrants, despite an accumulated deficit from net losses | Metric (in thousands) | Balances, January 1, 2025 | Issuance of shares for cash | Issuance of shares related to exercise of warrants | Stock-based compensation | Net Loss | Balances, June 30, 2025 | | :-------------------- | :------------------------ | :-------------------------- | :------------------------------------------------- | :----------------------- | :------- | :---------------------- | | Common Stock Amount | $13 | $2 | $1 | $- | $- | $16 | | Additional Paid-In Capital | $307,756 | $281,640 | $21,865 | $4,669 | $- | $615,948 | | Accumulated Deficit | $(200,482) | $- | $- | $- | $(19,500) | $(219,982) | | Total Stockholders' Equity | $107,287 | $281,642 | $21,866 | $4,669 | $(19,500) | $395,982 | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) The company experienced a significant net increase in cash and cash equivalents for the six months ended June 30, 2025, primarily driven by substantial cash provided by financing activities, which offset cash used in operating and investing activities | Cash Flow Activity (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(10,534) | $(7,862) | | Net cash used in investing activities | $(2,757) | $(2,656) | | Net cash provided by financing activities | $283,104 | $10,985 | | Net increase in cash and cash equivalents | $269,813 | $467 | | Cash and cash equivalents, end of period | $348,758 | $2,526 | [Notes to the Unaudited Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20the%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed information on the company's corporate history, business nature, significant accounting policies, segment reporting, income taxes, intangible assets, property and equipment, operating leases, commitments and contingencies, capital stock, stock-based compensation, related party transactions, license agreements, and subsequent events, offering crucial context to the condensed consolidated financial statements [Note 1. Nature of the Organization and Business](index=9&type=section&id=Note%201.%20Nature%20of%20the%20Organization%20and%20Business) Quantum Computing Inc. (QCi) is an American company focused on developing quantum computing, reservoir computing, and remote sensing, imaging, and cybersecurity applications using integrated photonics and non-linear quantum optics, with its products designed for room-temperature, low-power operation, and Entropy Quantum Computing (EQC) as its leading application, while recent equity issuances have significantly improved its liquidity despite historical losses - QCi develops quantum computing, reservoir computing, and remote sensing/imaging/cybersecurity applications using integrated photonics and non-linear quantum optics[26](index=26&type=chunk) - The company's products, including its leading Entropy Quantum Computing (EQC) application, are designed to operate at room temperature and low power, emphasizing scalability, accessibility, and affordability[26](index=26&type=chunk)[27](index=27&type=chunk) Liquidity Status (as of June 30, 2025) | Metric | Amount (in thousands) | | :-------------------- | :-------------------- | | Cash and cash equivalents | $348,800 | | Accumulated deficit | $(220,000) | | Working capital | $346,300 | | Shares of common stock issued (six months ended June 30, 2025) | 22,200 | | Net proceeds from common stock issuance | $281,600 | [Note 2. Significant Accounting Policies](index=9&type=section&id=Note%202.%20Significant%20Accounting%20Policies) This note outlines the significant accounting policies, including the basis of presentation, principles of consolidation, use of estimates, and specific policies for cash and cash equivalents, operating leases, goodwill valuation, property and equipment, impairment of long-lived assets, fair value of financial instruments, research and development costs, income taxes, and net loss per share, also detailing the adoption of new accounting pronouncements - The company prepares its consolidated financial statements in conformity with U.S. GAAP and SEC rules, with all intercompany balances and transactions eliminated[29](index=29&type=chunk)[30](index=30&type=chunk) - Management makes significant estimates for goodwill and intangible assets valuation, deferred tax assets, equity-based transactions, and liquidity assessment[33](index=33&type=chunk) Fair Value of Financial Instruments (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Cash and cash equivalents (Level 1) | $348,400 | $78,900 | | Derivative liabilities (Level 3) | $24,600 | $40,500 | - Research and development costs are expensed as incurred, covering direct costs, outside contractors, intellectual property acquisition, and compliance fees[44](index=44&type=chunk) - The company adopted ASU 2023-09 (Income Taxes) as of January 1, 2025, which did not have a material effect, and is evaluating ASU 2024-03 (Income Statement Expenses) and ASU 2025-05 (Credit Losses)[50](index=50&type=chunk)[52](index=52&type=chunk)[53](index=53&type=chunk) [Note 3. Segment Reporting](index=14&type=section&id=Note%203.%20Segment%20Reporting) The company operates as a single operating and reportable segment, with the CEO managing business activities at a consolidated level, and the segment information details revenue, significant expenses, and net loss for the three and six months ended June 30, 2025 and 2024 - The Chief Operating Decision Maker (CEO) manages the company's business activities as a single operating and reportable segment[55](index=55&type=chunk) Segment Information (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue | $61 | $183 | $100 | $210 | | Salaries and employee related costs | $3,994 | $2,623 | $7,239 | $4,836 | | Stock-based compensation | $1,778 | $651 | $3,182 | $1,936 | | Professional services and legal fees | $985 | $675 | $2,517 | $1,544 | | Operating loss | $(10,171) | $(5,267) | $(18,457) | $(11,585) | | Segment net (loss) income | $(36,482) | $(5,194) | $(19,500) | $(11,630) | [Note 4. Income Taxes](index=15&type=section&id=Note%204.%20Income%20Taxes) The company uses the asset and liability method for income taxes, recognizing deferred tax assets and liabilities, with a valuation allowance applied against all net deferred tax assets, resulting in a **0%** effective tax rate for the six months ended June 30, 2025 and 2024, and also has uncertain tax positions related to R&D tax credits - The total effective tax rate was approximately **0%** for both the six months ended June 30, 2025 and 2024, primarily due to a valuation allowance against net deferred tax assets[57](index=57&type=chunk) - As of June 30, 2025, the company has approximately **$264 thousand** in uncertain tax positions, all related to R&D tax credits, with no significant changes expected in the next 12 months[59](index=59&type=chunk) [Note 5. Intangible Assets, net](index=15&type=section&id=Note%205.%20Intangible%20Assets%2C%20net) This note details the company's intangible assets, primarily acquired through the QPhoton Merger, including non-compete agreements, website domain/trademark, and technology/licensed patents, and provides the amortization expense and future amortization schedule Intangible Assets, Net (in thousands) | Asset Category | June 30, 2025 (Net Carrying Amount) | December 31, 2024 (Net Carrying Amount) | | :----------------------------- | :---------------------------------- | :------------------------------------ | | Non-compete agreement with founder | $- | $451 | | Website domain name and trademark | $386 | $488 | | Technology and licensed patents | $7,124 | $8,033 | | **Total** | **$7,510** | **$8,972** | Amortization Expense (in thousands) | Period | Amortization Expense | | :----------------------------- | :------------------- | | Three months ended June 30, 2025 | $686 | | Three months ended June 30, 2024 | $776 | | Six months ended June 30, 2025 | $1,462 | | Six months ended June 30, 2024 | $1,552 | Expected Future Amortization Expense (in thousands) | Year | Amortization | | :-------------------- | :----------- | | 2025 (remaining six months) | $1,010 | | 2026 | $2,021 | | 2027 | $1,903 | | 2028 | $1,819 | | 2029 | $757 | | **Total** | **$7,510** | [Note 6. Property and Equipment, net](index=16&type=section&id=Note%206.%20Property%20and%20Equipment%2C%20net) This note provides a breakdown of the company's property and equipment, primarily located in Hoboken, NJ, and Tempe, AZ, including computer and lab equipment, network equipment, furniture, software, and leasehold improvements, and details the accumulated depreciation and depreciation expense for the periods Property and Equipment, Net (in thousands) | Asset Category | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Total cost of property and equipment | $11,935 | $9,178 | | Accumulated depreciation | $(1,366) | $(966) | | **Property and equipment, net** | **$10,569** | **$8,212** | Depreciation Expense (in thousands) | Period | Depreciation Expense | | :----------------------------- | :------------------- | | Three months ended June 30, 2025 | $202 | | Three months ended June 30, 2024 | $71 | | Six months ended June 30, 2025 | $400 | | Six months ended June 30, 2024 | $139 | [Note 7. Operating Leases](index=16&type=section&id=Note%207.%20Operating%20Leases) The company has operating leases for office space in Hoboken, NJ, Tempe, AZ, and Arlington, VA, expiring through November 2028, with operating lease ROU assets and liabilities recognized based on the present value of future minimum lease payments, using an incremental borrowing rate of **10%** - The company leases office space in three locations (Hoboken, NJ, Tempe, AZ, and Arlington, VA) with lease terms extending through November 30, 2028[62](index=62&type=chunk) Operating Lease Commitments (as of June 30, 2025, in thousands) | Year | Lease Payments Due | | :-------------------------- | :----------------- | | 2025 (remaining six months) | $396 | | 2026 | $807 | | 2027 | $828 | | 2028 | $458 | | Total minimum payments | $2,489 | | Present value of operating lease liabilities | $2,171 | | Long-term operating lease liabilities | $1,536 | - The weighted average remaining lease term is **3.1 years**, and the weighted average discount rate used is **10%**[63](index=63&type=chunk) [Note 8. Commitments and Contingencies](index=17&type=section&id=Note%208.%20Commitments%20and%20Contingencies) The company enters into standard indemnification arrangements and is involved in various legal proceedings, including a breach lawsuit and an appraisal action related to the QPhoton Merger with BV Advisory, which were settled in July 2025, and also faces a securities class action and shareholder derivative actions - The company has standard indemnification arrangements with business partners, customers, directors, and officers, with estimated minimal fair value[64](index=64&type=chunk)[65](index=65&type=chunk) - BV Advisory filed a breach lawsuit and an appraisal action against QCi related to the QPhoton Merger, both of which were settled on July 17, 2025[68](index=68&type=chunk)[69](index=69&type=chunk)[72](index=72&type=chunk) - As of June 30, 2025, the company had a **$536 thousand** estimated payable to BV Advisory and a **$24.6 million** carrying value for Unissued QPhoton Warrants as a liability[68](index=68&type=chunk)[72](index=72&type=chunk) [Note 9. Capital Stock](index=18&type=section&id=Note%209.%20Capital%20Stock) This note details the company's authorized stock, including Series A and B preferred stock (none outstanding), and common stock, covering various equity financing activities such as the Series A Convertible Preferred Offering (redeemed), an At-the-Market (ATM) Facility (no sales in H1 2025), and significant private placement offerings in January and June 2025, and also provides a summary of outstanding warrants and their impact on derivative liability - The company has authorized Series A and Series B preferred stock, with no shares issued and outstanding as of June 30, 2025[73](index=73&type=chunk) - The Series A Preferred Stock was fully redeemed by December 31, 2024, for an aggregate cash purchase price of **$8.195 million**[77](index=77&type=chunk) Equity Issuances (Six Months Ended June 30, 2025, in thousands) | Offering Type | Gross Proceeds | | :-------------------------- | :------------- | | January Private Placement | $100,000 | | June Private Placement | $200,000 | | Total net proceeds raised | $283,100 | Warrant Activity (Six Months Ended June 30, 2025, in thousands, except price) | Warrant Type | Exercise Price | Issued | Exercised | Forfeited / Cancelled | Outstanding (June 30, 2025) | | :-------------------------- | :------------- | :----- | :-------- | :-------------------- | :-------------------------- | | QPhoton Warrants | $0.0001 | 6,325 | (1,146) | (3,876) | 1,303 | | Placement Agent Warrants | $2.875 | 800 | (304) | - | 496 | | Placement Agent Warrants | $5.75 | 500 | (100) | - | 400 | | January Private Placement Warrants | $14.0875 | 327 | - | - | 327 | | Total Warrants Outstanding | | | | | 2,541 | - The company recognized a mark-to-market loss of **$28.1 million** and **$4.5 million** for the three and six months ended June 30, 2025, respectively, due to changes in the fair value of QPhoton Warrant liability, which had a carrying value of **$24.6 million** as of June 30, 2025[93](index=93&type=chunk) [Note 10. Stock-based Compensation](index=22&type=section&id=Note%2010.%20Stock-based%20Compensation) This note details the company's stock-based compensation plans, including the 2019 and 2022 Equity and Incentive Plans, summarizing stock option and restricted stock activity, as well as the recognized stock-based compensation expense for employees and for services rendered by consultants - The 2022 Equity and Incentive Plan reserved **19.0 million shares** of common stock for issuance, with **16.6 million shares** issued and outstanding as of June 30, 2025[96](index=96&type=chunk) Stock Option Activity (Six Months Ended June 30, 2025, in thousands, except price) | Metric | Number Outstanding | Weighted Average Exercise Price per Share | | :-------------------------- | :----------------- | :---------------------------------------- | | Balance as of December 31, 2024 | 12,983 | $2.34 | | Granted | 1,005 | $7.63 | | Exercised | (6,917) | $2.31 | | Forfeited | (260) | $9.26 | | Balance as of June 30, 2025 | 6,811 | $2.89 | | Vested and exercisable as of June 30, 2025 | 3,556 | $3.49 | Stock-based Compensation Expense (in thousands) | Expense Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Research and development | $467 | $505 | $964 | $1,199 | | Selling and marketing | $31 | $43 | $91 | $111 | | General and administrative | $1,279 | $143 | $2,109 | $607 | | **Total stock-based compensation** | **$1,777** | **$691** | **$3,164** | **$1,917** | [Note 11. Related Party Transactions](index=24&type=section&id=Note%2011.%20Related%20Party%20Transactions) There were no related party transactions during the three and six months ended June 30, 2025 and 2024 - No related party transactions occurred during the three and six months ended June 30, 2025 and 2024[104](index=104&type=chunk) [Note 12. License Agreement – Stevens Institute of Technology](index=24&type=section&id=Note%2012.%20License%20Agreement%20%E2%80%93%20Stevens%20Institute%20of%20Technology) The company holds a License Agreement with the Stevens Institute, assigned during the QPhoton Merger, granting commercial use and sublicensing rights for licensed patents, applications, and 'Know-How', requiring annual reports and quarterly royalty payments (**3.5%** of net sales) upon commercialization, with the company also responsible for patent prosecution and maintenance costs - The Stevens License Agreement grants the company commercial use and sublicensing rights for licensed technology, effective for **30 years** or until the last patent expires[105](index=105&type=chunk) - Consideration for the agreement includes an initial **$35 thousand** payment, **$28 thousand** annually, equity equivalent to **9%** of outstanding equity, and **3.5%** royalties on net sales of licensed products[107](index=107&type=chunk) - As of June 30, 2025, the company has begun commercializing some licensed technology but has not recognized related revenue or incurred royalty expenses[108](index=108&type=chunk) [Note 13. Subsequent Events](index=25&type=section&id=Note%2013.%20Subsequent%20Events) Subsequent to the reporting period, on July 17, 2025, the company settled all disputes with Barksdale and BV Advisory, agreeing to pay **$750,000** and issue **1.9 million shares** of common stock, with a resale registration statement filed on July 28, 2025 - On July 17, 2025, the company settled all disputes with Barksdale and BV Advisory[109](index=109&type=chunk) - The settlement terms included a payment of **$750,000** and the issuance of **1.9 million shares** of common stock to Barksdale or his designees[109](index=109&type=chunk) - A resale registration statement for the issued shares was filed on July 28, 2025, and declared effective on August 4, 2025[109](index=109&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition and results of operations, including a business overview, discussion of economic conditions and risks, detailed analysis of financial performance, and an assessment of liquidity and capital resources, highlighting the company's development stage, quantum technology focus, and significant financial changes [Business Overview](index=27&type=section&id=Business%20Overview) QCi is a development-stage company focused on quantum and ancillary non-quantum products for high-performance computing, sensing, imaging, and cybersecurity, utilizing proprietary photonics technology, with its Entropy Quantum Computer (EQC) as a key application, and has completed a Thin Film Lithium Niobate (TFLN) optical integrated circuits manufacturing facility in Tempe, Arizona - QCi is a development-stage company with limited operations and revenue, developing quantum and non-quantum products for high-performance computing applications based on proprietary photonics technology[116](index=116&type=chunk) - The company's core technology involves conditioning, manipulating, and measuring single photons, with the Entropy Quantum Computer (EQC) being a leading application designed to solve complex optimization problems at room temperature and low power[117](index=117&type=chunk) - QCi's longer-term plan is to migrate product designs to Thin Film Lithium Niobate (TFLN) optical integrated circuits, with a state-of-the-art TFLN chip manufacturing facility completed in Tempe, Arizona in March 2025[118](index=118&type=chunk) [Economic Conditions, Challenges, and Risks](index=27&type=section&id=Economic%20Conditions%2C%20Challenges%2C%20and%20Risks) The company operates in a dynamic and highly competitive market for high-performance computing and cloud services, facing challenges from new computing devices and competing cloud services, with investments in quantum optical chips increasing operating costs and reliance on third-party suppliers posing supply chain risks, while attracting and retaining qualified employees is also crucial for success - The markets for high-performance conventional and quantum computing and cloud-based services are dynamic and highly competitive, with competitors developing new devices and enhancing cloud services[120](index=120&type=chunk) - Investments in quantum optical chips and devices are expected to increase operating costs and may decrease operating margins, with reliance on third-party suppliers for critical components posing potential disruption risks[121](index=121&type=chunk) - Success is highly dependent on the ability to attract and retain qualified employees in a competitive talent market[122](index=122&type=chunk) [Results of Operations](index=28&type=section&id=Results%20of%20Operations) The company experienced a significant decrease in total revenue for both the three and six months ended June 30, 2025, primarily due to changes in customer contracts, despite an improved gross profit margin, while operating expenses, particularly research and development, sales and marketing, and general and administrative, increased substantially, and a significant non-operating loss was recorded due to changes in the fair value of derivative liability Key Financial Results (in thousands, except percentages) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | % Change | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | % Change | | :-------------------------------- | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | Total revenue | $61 | $183 | (67)% | $100 | $210 | (52)% | | Gross profit | $26 | $58 | (55)% | $39 | $69 | (43)% | | Gross profit margin | 43% | 32% | 34% | 39% | 33% | 19% | | Research and development | $5,975 | $2,094 | 185% | $8,960 | $4,315 | 108% | | Sales and marketing | $680 | $429 | 59% | $1,352 | $880 | 54% | | General and administrative | $3,542 | $2,802 | 26% | $8,184 | $6,459 | 27% | | Loss from operations | $(10,171) | $(5,267) | 93% | $(18,457) | $(11,585) | 59% | | Change in fair value of derivative liability | $(28,096) | $- | NM | $(4,466) | $- | NM | | Net loss | $(36,482) | $(5,194) | 602% | $(19,500) | $(11,630) | 68% | - Revenue decreased primarily due to changes in the number, size, and effort level of active customer proof-of-concept and R&D services and custom hardware contracts[123](index=123&type=chunk) - Research and development expenses increased significantly due to higher headcount, payroll costs, recurring lab equipment and consumables, and depreciation[127](index=127&type=chunk) - A substantial loss of **$28.1 million** (three months) and **$4.5 million** (six months) was recognized from the change in fair value of the QPhoton Warrant liability, driven by mark-to-market adjustments[133](index=133&type=chunk) [Liquidity and Capital Resources](index=30&type=section&id=Liquidity%20and%20Capital%20Resources) The company has historically incurred net losses and negative cash flows from operations but significantly improved its liquidity with **$348.8 million** in cash and cash equivalents as of June 30, 2025, primarily from **$281.6 million** in equity private placements, resulting in a substantial increase in working capital and providing sufficient funds for the next 12 months, though future funding will be required for continued investment in operations and product development - The company has incurred net losses and negative cash flows from operations since inception[134](index=134&type=chunk) Liquidity and Working Capital (in thousands) | Metric | June 30, 2025 | December 31, 2024 | Change | | :-------------------------- | :------------ | :---------------- | :----- | | Cash and cash equivalents | $348,800 | $78,945 | $269,855 | | Total current assets | $350,225 | $79,151 | $271,074 | | Total current liabilities | $3,972 | $4,559 | $(587) | | Working capital | $346,253 | $74,592 | $271,661 | - Net cash provided by financing activities was **$283.1 million** for the six months ended June 30, 2025, primarily from stock issuances, significantly increasing cash and cash equivalents[139](index=139&type=chunk)[141](index=141&type=chunk) - The company believes existing cash and cash equivalents, along with future cash generation and equity/debt issuances, will be sufficient to meet liquidity needs for at least the next 12 months[135](index=135&type=chunk) [Critical Accounting Estimates](index=31&type=section&id=Critical%20Accounting%20Estimates) The company's accounting policies require significant management judgment and estimates, but there have been no material changes to its critical accounting estimates since the Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes to critical accounting estimates have occurred since the Annual Report on Form 10-K for the year ended December 31, 2024[144](index=144&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=32&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section states that there are no quantitative and qualitative disclosures about market risk applicable to the company for the reporting period - Not applicable[145](index=145&type=chunk) [Item 4. Controls and Procedures](index=32&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were not effective as of June 30, 2025, to provide reasonable assurance for timely and accurate information disclosure, however, there were no material changes in internal control over financial reporting during the most recent fiscal quarter - As of June 30, 2025, the company's disclosure controls and procedures were not effective to provide reasonable assurance for timely and accurate information disclosure[147](index=147&type=chunk) - There were no changes in internal control over financial reporting during the most recent fiscal quarter that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[148](index=148&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=33&type=section&id=Item%201.%20Legal%20Proceedings) This section details the company's involvement in various legal proceedings, including resolved disputes with BV Advisory Partners, LLC concerning an appraisal action and breach of contract, and ongoing litigation such as a securities class action lawsuit, multiple shareholder derivative actions, and stock options arbitration with former consultants, with the company disputing the allegations and intending to vigorously defend against the claims - BV Advisory Partners, LLC filed an appraisal action and a breach of contract lawsuit against the company, both of which were settled on July 17, 2025, with the company agreeing to pay **$750,000** and issue **1.9 million shares** of common stock[151](index=151&type=chunk)[152](index=152&type=chunk)[155](index=155&type=chunk) - A securities class action lawsuit was filed on February 25, 2025, alleging violations of the Exchange Act due to false/misleading statements, with the company disputing allegations and intending to defend vigorously[156](index=156&type=chunk) - Multiple shareholder derivative actions were filed in March, May, and June 2025, alleging breaches of fiduciary duties and other claims, which have been stayed pending resolution of the securities class action[157](index=157&type=chunk)[158](index=158&type=chunk)[159](index=159&type=chunk) - The company is involved in arbitrations with two former consultants regarding the forfeiture of stock options, disputing their claims[160](index=160&type=chunk) [Item 1A. Risk Factors](index=35&type=section&id=Item%201A.%20Risk%20Factors) This section refers to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024, and the Form 10-Q for the quarter ended March 31, 2025, stating that there have been no material changes to these risks - No material changes to the company's risk factors have occurred since the 2024 Form 10-K, except for those disclosed in the first quarter 2025 Form 10-Q[161](index=161&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=35&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered, unreported sales of equity securities or company repurchases of equity securities during the three months ended June 30, 2025 - No unregistered or unreported sales of equity securities or company repurchases occurred during the three months ended June 30, 2025[162](index=162&type=chunk) [Item 3. Defaults Upon Senior Securities](index=35&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults in the payment of principal, interest, sinking or purchase fund installment, or any other material default with respect to any indebtedness - There has been no default in the payment of principal, interest, or any other material default with respect to any indebtedness of the company[163](index=163&type=chunk) [Item 4. Mine Safety Disclosures](index=35&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not Applicable[164](index=164&type=chunk) [Item 5. Other Information](index=35&type=section&id=Item%205.%20Other%20Information) There is no other information to report under this item - None[165](index=165&type=chunk) [Item 6. Exhibits](index=36&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the Form 10-Q, including employment agreements, purchase agreements, placement agency agreements, lock-up agreements, separation agreements, and certifications from the CEO and CFO, along with XBRL documents - Exhibits include various agreements (Employment, Purchase, Placement Agency, Lock-Up, Separation) and certifications (CEO, CFO) related to the reporting period[166](index=166&type=chunk) - The filing also includes Inline XBRL Instance, Taxonomy Extension Schema, Calculation, Definition, and Label Linkbase Documents, and a Cover Page Interactive Data File[166](index=166&type=chunk)

Quantum Computing, Inc. QUBT released its second-quarter results after Thursday's closing bell. Here's a look at the details in the report. QUBT stock is sliding after earnings. See the chart and price action here. The Details: Quantum Computing reported quarterly losses of 26 cents per share, which missed the consensus estimate for losses of six cents.  Quarterly revenue of $61,000 missed the Street estimate of $100,000 and is down from revenue of $183,000 from the prior year’s quarter. Read Next: Retail C ...

IonQ and Quantum Computing Inc. both build quantum equipment, but one stands out as the superior investment. The field of quantum computing is exciting. Quantum computers use atomic particles to perform complex calculations beyond the abilities of today's supercomputers, positioning them to revolutionize numerous industries. Quantum Computing Inc. takes a different approach. It embraces the inherent chaos of harnessing these particles in a technique called entropy quantum computing. This method allows QCi's ...

That said, if you are looking for potential upside with reduced volatility than standalone stocks, the Trefis High Quality portfolio offers an alternative — having surpassed the S&P 500 and yielding returns greater than 91% since its launch. In addition, see – Bigbear.ai: Sell BBAI Stock At $5? See earnings reaction history of all stocks CHONGQING, CHINA - MAY 11: In this photo illustration, the logo of Quantum Computing Inc. (QCi) is displayed on a smartphone screen, with the company's branding visible in ...

Company Overview - Quantum Computing Inc. (QCi) is an innovative company specializing in integrated photonics and quantum optics technology, providing accessible and affordable quantum machines and foundry services for photonic chip production based on thin-film lithium niobate (TFLN) [4] - The company's products are designed to operate at room temperature and low power, making them cost-effective [4] - QCi's technology portfolio includes capabilities in high-performance computing, artificial intelligence, cybersecurity, and remote sensing applications [4] Upcoming Events - QCi will host a conference call and webcast on August 14, 2025, at 4:30 p.m. Eastern Time to review its operational progress for the second quarter ended June 30, 2025 [1] - The company will release its second quarter 2025 financial results on the same day after the market closes [1] Access Information - Investors can access the live webcast through the QCi Investor Relations page or via a specific link provided [2] - For phone participation, a specific dial-in number and access code are provided for both domestic and international callers [2] Replay Information - A replay of the teleconference will be available until August 28, 2025, with specific dial-in numbers and conference ID for access [3]

Core Viewpoint - Defiance ETFs has launched the Defiance 2X Daily Long Pure Quantum ETF (Ticker: QPUX), which aims to provide investors with 2X daily leveraged exposure to a selected group of quantum computing companies, highlighting the potential of this transformative technology sector [1][4]. Company Overview - Defiance ETFs, founded in 2018, specializes in thematic, income, and leveraged ETFs, positioning itself as a leader in ETF innovation [5]. ETF Structure and Strategy - QPUX seeks to deliver daily investment results of 200% of the daily performance of its equal-weighted Target Portfolio, which includes IONQ, Inc. (IONQ), Rigetti Computing, Inc. (RGTI), D-Wave Quantum Inc. (QBTS), and Quantum Computing Inc. (QUBT) [2][16]. - The portfolio is rebalanced daily to maintain equal weighting among the four companies [2][16]. - The ETF utilizes derivatives, including swaps and listed options, to achieve its leveraged exposure [3][17]. Industry Context - Quantum computing leverages advanced phenomena like superposition and entanglement, enabling faster and more efficient information processing compared to classical computing [4]. - The companies within QPUX's portfolio are focused on developing quantum hardware, software, and related technologies, positioning them to benefit from advancements in the industry [4].

Group 1: Company Developments - Quantum Computing Inc. (QUBT) is making significant progress in 2025 with hardware advancements and strategic customer acquisitions, including the delivery of its first commercial entangled photon source to a South Korean research institution [1] - QUBT has made its commercial debut in quantum-secured communications by securing a $332,000 order from a top-five U.S. bank for a quantum communication system [2] - The company is targeting real-world applications across critical sectors such as finance, national security, space, and life sciences, indicating potential follow-on orders or scale-up discussions [3] Group 2: Industry Positioning - IonQ (IONQ) has partnered with Emergence Quantum to co-develop advanced materials and secured a $22 million deal to create a U.S. hub for quantum computing [4] - D-Wave Quantum (QBTS) raised $400 million to enhance liquidity for scaling and strategic M&A, and announced a NASA-partnered initiative to improve processor density [5] Group 3: Market Performance - QUBT shares have increased by 112.8% over the past three months, significantly outperforming the industry growth of 18.2% and the sector's rise of 19% [6] - The average target price for QUBT indicates a near-term upside, as it is currently trading 25% below its average Zacks price target [10]

Group 1 - Quantum concept stocks experienced an upward trend on Tuesday, with Quantum Computing (QUBT.US) rising nearly 5% [1] - IonQ Inc (IONQ.US) and Arqit Quantum (ARQQ.US) both increased by over 3% [1] - Rigetti Computing (RGTI.US) saw a rise of more than 1.8% [1]

About Quantum Computing Inc. HOBOKEN, N.J., Aug. 5, 2025 /PRNewswire/ -- Quantum Computing Inc. ("QCi" or the "Company") (Nasdaq: QUBT), an innovative, integrated photonics and quantum optics technology company, today announced it has been awarded a contract by the National Institute of Standards and Technology (NIST), part of the U.S. Department of Commerce, for the design and fabrication of thin-film lithium niobate (TFLN) photonic integrated circuits (PICs). In addition, the Company has received a chip o ...