Expectations for quantum computing are rising fast, with global quantum computing revenues expected to reach around $9 billion by 2030. Up from $260 million in 2020, that points to over 40% annual growth for the decade.
Against that backdrop, D-Wave Quantum (QBTS) has announced a major $550 million agreement to acquire Quantum Circuits Inc., a developer of error-corrected superconducting gate-model quantum systems.
The deal is made up of about $300 million in D-Wave common stock and $250 million in cash. It's meant to combine D-Wave’s quantum cloud platform and annealing know-how with Quantum Circuits’ dual-rail, error-corrected gate-model technology. Management says this mix should accelerate its plan to build a scaled, fully error-corrected gate-model quantum computer. An initial dual-rail system is expected to be available in 2026.
With quantum computing still years away from mass commercial adoption and Wedbush calling the acquisition a “formidable ally,” does QBTS merit a spot in a portfolio at today’s levels, or is this latest acquisition-driven rally getting ahead of what the business can realistically deliver? Let’s find out.
QBTS’s Financial Check
D-Wave Quantum (QBTS) makes money in a few connected ways. It provides cloud access to its annealing quantum computers, builds out gate-model systems, and sells software and services that companies can use for optimization and increasingly AI-related work. Over the past 52 weeks, QBTS is up roughly 360% and up 7.5% year-to-date (YTD), which shows a shift in sentiment.
Latest results show quarterly revenue of about $3.7M, up 100% from a year ago and up more than 20% from the prior quarter, while trailing annual sales are around $9M. Bookings momentum has also improved, topping $2.4M in a quarter, with more than $12M signed just after period-end.
At the same time, gross metrics look better, with GAAP gross profit of roughly $2.7M and gross margin in the low 70% range, up from the mid 50% range a year earlier, as higher-value systems like the upgraded Advantage2 deployment begin to scale.
But spending remains heavy. Operating expenses were just over $30M in the latest quarter, driven by higher costs for staff, fabrication, and stock-based compensation, and the business is still deeply unprofitable with an annual net loss around $144M and EPS near -1.35. In the most recent quarter, net loss came in around $140M, mostly because of more than $120M in non-cash warrant-related charges linked to the stock’s sharp move.
The Real Growth Story Behind QBTS
D-Wave recently demonstrated scalable on-chip cryogenic control of gate-model qubits, described as an industry-first step that reduces wiring complexity without hurting qubit fidelity. This means the same multiplexed control technology D-Wave already uses to manage tens of thousands of qubits and couplers in its commercial annealing QPUs with about 200 bias wires can now be used for gate-model architectures also. This removes a major roadblock to building large, commercially practical gate-model systems.
Additionally, D-Wave is widening the reach of its annealing business in both geography and real-world deployments. In Italy, it is backing the new Q-Alliance with a €10M contract tied to an Advantage2 annealing quantum computer, including a five-year agreement for 50% of the system’s capacity and an option to buy the full system. The goal is to make D-Wave hardware a key shared resource for Italian universities, industry, and government, which helps build long-term usage.
Regarding software, D-Wave has released an open-source quantum AI toolkit plus a demo that lets developers connect its quantum processors to modern ML architectures and even generate simple images, demonstrating that annealing quantum hardware can be used in AI-focused work.
Street Targets and the Road Ahead for QBTS
Consensus estimates for the current quarter (12/2025) call for average EPS of -$0.05 versus -$0.37 a year ago, a near 86.49% year-over-year (YOY) improvement. Zooming out to the full fiscal year 12/2025, the Street is at -$0.20 versus -$0.75 last year, implying a 73.33% improvement.
That trend toward smaller losses helps explain why price targets are still sitting well above the current trading range. Jefferies is at the high end with a $45 target, which was about 73% upside from where the stock traded at the time of that December call, showing more willingness to put numbers around the long-term commercial opportunity. Wedbush is also leaning into the deal as the key catalyst, with an “Outperform” rating and a $35 price target, and the analyst calling the Quantum Circuits acquisition a “formidable ally” that could speed the push toward a scaled, error-corrected gate-model system.
Of 15 analysts surveyed, 13 rate QBTS a consensus “Strong Buy," one as a “Moderate,” and one as a “Hold,” and the mean target is $38.93. Against the current price of $28.11, that implies a 38.5% upside.
Conclusion
For now, QBTS still looks like a high-octane, high-risk speculative buy rather than a core portfolio holding. The Quantum Circuits deal, the on-chip cryogenic control breakthrough, and the growing quantum AI and European footprints all point in the right strategic direction, and the Street’s “Strong Buy” stance with roughly 39% implied upside suggests the path of least resistance is still higher over the next year, especially if execution stays on track.
On the date of publication, Ebube Jones did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
More news from Barchart
