D-Wave Quantum (QBTS) - 2024 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Revenue for fiscal year 2024 was $8.8 million, essentially flat compared to fiscal year 2023 revenue of$8.8 million [30] - Bookings for fiscal year 2024 reached a record $23.9 million, an increase of 128$10.5 million [30] - GAAP gross profit for fiscal year 2024 was $5.6 million, a 20$4.6 million [31] - Net loss for fiscal year 2024 was $143.9 million, compared to a net loss of$82.7 million in fiscal year 2023 [32] - Adjusted EBITDA loss for fiscal year 2024 was $56 million, an increase of 3$54.3 million in fiscal year 2023 [33] Business Line Data and Key Metrics Changes - The fourth quarter revenue totaled $2.3 million, a decrease of 21$2.9 million [34] - Bookings for the fourth quarter were a record $18.3 million, an increase of over 500$3 million [34] - Non-GAAP gross profit for the fourth quarter was $1.7 million, a decrease of 28$2.3 million [34] Market Data and Key Metrics Changes - D-Wave had a total of 135 customers in fiscal year 2024, compared to 133 customers in fiscal year 2023 [30] - The customer base included 59 research institution and government customers in 2024, up from 55 in fiscal year 2023 [30] - The number of commercial customers was 76 in fiscal year 2024, down from 78 in fiscal year 2023 [30] Company Strategy and Development Direction - D-Wave aims to be the first pure play quantum company to reach profitability with less cash invested than competitors [10] - The company is focusing on a quantum compute as a service model for the majority of its commercial customers while also pursuing system sales [18] - D-Wave is developing a sixth generation annealing quantum computer, Advantage 2, which is expected to deliver significant performance gains [15] Management's Comments on Operating Environment and Future Outlook - Management highlighted the importance of the recent demonstration of quantum supremacy as a significant milestone for the quantum industry [57] - The company expects to see increased interest in system sales and believes that the recent achievements will positively impact customer engagement [49] - Management anticipates fiscal year 2025 Q1 revenue to exceed $10 million, driven by the sale of an Advantage annealing quantum computer [39] Other Important Information - D-Wave's cash balance exceeded$300 million, which is believed to be sufficient to reach sustained profitability [10] - The company completed two separate ATM programs in the fourth quarter that brought in a total of $175 million in gross proceeds [25] - D-Wave announced a quantum uplift program to attract organizations dissatisfied with competitors' quantum systems [22] Q&A Session Summary Question: Insights on Advantage 2's impact on existing commercial engagements - Management confirmed that Advantage 2's capabilities will enhance performance for existing customers and attract new ones [44] Question: Future system sales and revenue expectations - Management indicated ongoing discussions with three other institutions for potential system sales, but did not provide specific revenue guidance [50] Question: Impact of recent publications on industry perception - Management noted that the recent achievement has positively influenced both the academic community and commercial entities, despite some resistance [56] Question: Breakdown of revenue recognition from the Jülich system sale - Management clarified that revenue from the Jülich system sale will be recognized in the first quarter following installation and acceptance [105] Question: Future revenue models for system sales - Management stated that future deals will be tailored to customer needs, affecting the structure of revenue recognition [75] Question: Potential for scaling and R&D acceleration - Management expressed interest in accelerating R&D efforts, particularly in scaling quantum systems and exploring gate model opportunities [86]