D-Wave Quantum last week reported $1.7 million in revenue for the second quarter, a figure only slightly higher than the $1.6 million it reported in the first quarter this year, and giving the company about $3.3 million in revenue for the first half of 2023.
However, the company’s outlook for the remainder of the year suggested that things are about to get interesting. D-Wave is still expecting full-year 2023 revenue to fall in the range between $11 million and $13 million, meaning either D-Wave’s salesforce has a lot of work to do, or the company is expecting to close one or more big deals already in the works.
D-Wave officials are not saying much more for now. They declined on last week’s earnings call to offer a per-quarter breakout for the revenue outlook for the rest of the year. What is clear is that the company has reported increased bookings in each of the first two quarters this year, as well as an increase in average deal size. D-Wave CFO John Markovich said on the call that bookings for the second quarter this year amounted to $2.5 million, an increase of $1.5 million, or 146%, compared to the second quarter of 2022. Also, average deal size, or average dollar amount per booking, jumped 136% year-over-year. The bigger deals have been all aspects of the company’s business, including professional services and quantum computing-as-a-service.
Still, D-Wave has a lot of ground to cover the remainder of this year to more than double the revenue it reported for the first half just to reach the low end of its full-year revenue forecast. There is plenty of pressure on the company to do so, as its stock value remains well under its IPO price even after a recent boost in market interest that other quantum stocks also benefited from. D-Wave also continued to take in money from an existing equity line of credit last month to help it maintain a stronger cash position.
But, D-Wave CEO DR. Alan Baratz said last week that customer activity has started to enter a more mature and robust phase, and that it is taking less time than it once did to close deals–about five to seven months now, compared to more than a year not so long ago.
“…If I look back a year ago, our customers were mostly buying small amounts of time on our quantum system to kind of play around with it,” he said on the earnings call. “We affectionately called them the DIY or do-it-yourself customers. But they were not really focused on trying to solve a real business problem. They were just doing experimentation and trying to kind of understand the capabilities of the system. And over the course of the last year, we have really progressed to customers that have real business problems that they are interested in leveraging quantum computing to solve and working with us to help build out the solutions to those problems that do leverage our quantum computers through the proofs-of-concept.”
Maybe that will be enough to help D-Wave nail its full-year outlook.
Dan O’Shea has covered telecommunications and related topics including semiconductors, sensors, retail systems, digital payments and quantum computing/technology for over 25 years.
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- Source: https://www.insidequantumtechnology.com/news-archive/can-d-wave-reel-in-enough-revenue-to-hit-its-full-year-outlook/
