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D-Wave Quantum Inc.

D-Wave Quantum Inc.QBTS決算レポート

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D-Wave Quantum Inc. is a quantum computing company with locations in Palo Alto, California and Burnaby, British Columbia. D-Wave claims to be the world's first company to sell computers that exploit quantum effects in their operation. D-Wave's early customers include Lockheed Martin, the University of Southern California, Google/NASA, and Los Alamos National Laboratory.

What changed in D-Wave Quantum Inc.'s 10-K — 2024 vs 2025

Top changes in D-Wave Quantum Inc.'s 2025 10-K

670 paragraphs added · 601 removed · 257 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

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D-Wave was incorporated as a corporation organized and existing under the Delaware’s General Corporation Law on January 24, 2022. The Company was formed for the purpose of effecting a merger between DPCM, D‑Wave, and certain other affiliated entities through a series of transactions constituting the Merger pursuant to the Transaction Agreement.
Notes to Consolidated Financial Statements 1. DESCRIPTION OF BUSINESS D-Wave Quantum Inc. ("D-Wave" or the “Company”) was incorporated as a corporation organized and existing under the General Corporation Law of the State of Delaware on January 24, 2022. The Company was formed for the purpose of effecting a merger between DPCM Capital, Inc. (“DPCM”), D-Wave Systems Inc.
The closing of the Merger occurred on August 5, 2022, and is herein referred to as “the Closing.” On the date of the Closing, DPCM and D-Wave Systems became wholly-owned subsidiaries of, and are operated by, D‑Wave. Upon the completion of the Merger, D-Wave succeeded to all of the operations of its predecessor, D-Wave Systems.
Upon the completion of the Merger, the Company succeeded to all of the operations of its predecessor, D-Wave Systems. D-Wave is focused on the development and delivery of quantum computing systems, software, and services.
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Item 1. Business Unless the context requires otherwise, references in this section to “D-Wave,” “we,” “our” or “us” refer to D-Wave Quantum Inc., a Delaware corporation, and its consolidated subsidiaries following the consummation of the Transaction, and prior to the Consummation of the Transaction, to D-Wave Systems Inc., a British Columbia corporation ("D-Wave Systems").
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Financial Statements Report of Independent Registered Public Accounting Firm (Grant Thornton LLP, Bellevue, Washington, Auditor Firm ID: PCAOB ID 248) 85 Consolidated Balance Sheets as of December 31, 2025 and 2024 86 Consolidated Statements of Operations and Comprehensive loss for the years ended December 31, 2025 and 2024 87 Consolidated Statement of Stockholders' Equity (Deficit) for the years ended December 31, 2025 and 2024 88 Consolidated Statement of Cash Flows for the years ended December 31, 2025 and 2024 90 Notes to the Consolidated Financial Statements 91 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Board of Directors and Stockholders D-Wave Quantum Inc.
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Overview At D-Wave, our mission is to help customers realize the value of quantum computing to address problems that cannot be solved with classical computing alone.
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Opinion on the financial statements We have audited the accompanying consolidated balance sheets of D-Wave Quantum Inc.
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As a pioneer in the quantum industry for more than 25 years and the world’s first company to deliver commercial-grade annealing quantum computing solutions, we believe we are leading the industry in ushering in the era of enterprise quantum computing. This is a pivotal moment for the industry.
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(a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows for each of the two years in the period ended December 31, 2025, and the related notes (collectively referred to as the consolidated financial statements”).
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We are driving the transition from academic endeavors exploring quantum’s potential to enterprise-scale adoption and deployment, solving some of the world’s toughest problems. Based on our strategic decision to bring to market a different type of quantum technology— annealing quantum computing, we hold a first-mover advantage that no other company in the world can claim.
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In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.
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Our market leadership position is evident—we were the first to launch commercial quantum systems, the first to achieve a demonstration of quantum supremacy on a useful, real-world problem, and the first to have quantum applications running in production for commercial customers.
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Basis for opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits.
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Built upon our decades of quantum innovation, we offer a full stack of quantum systems, software and services capable of solving highly complex problems today. Our relentless commitment to innovation and invention means that we are laser-focused on continuously building quantum solutions that push the boundaries of what is possible.
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We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
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A key corporate strategy is to advance the science of quantum, and in support of that effort, we recently achieved a world-first quantum supremacy result—solving a useful, real-world problem that classical computation cannot. The peer-reviewed research paper was published in the esteemed publication, Science.
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We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
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The work was achieved using our latest qubit architecture, which shows increased coherence and thus more computational power. We will continue our groundbreaking research and innovation on qubit architecture design and fabrication and apply what we learn to new products and applications.
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The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.
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From a product perspective, we continue to develop systems that outperform previous generations, driving toward higher qubit count, greater qubit coherence, and increased energy scale.
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Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
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Benchmarking results from prototypes of our sixth-generation annealing quantum computing system, Advantage2™, indicate that this is our most performant system to date with 20-way connectivity, higher coherence times, and higher energy scales that to enable us to solve even larger and more complex problems, drive faster time-to-solution, and deliver higher-quality solutions.
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Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ GRANT THORNTON LLP We have served as the Company’s auditor since 2023. Bellevue, Washington February 26, 2026 85 D-Wave Quantum Inc.
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Our efforts to build a gate-model system are continuing to progress, with the development of high-coherence fluxonium qubits that show quantum properties comparable to the best seen to date in peer-reviewed scientific literature. We’re also extending the capabilities of hybrid and classical solvers to achieve best-in-class performance, expected to be unmatched by the industry.
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Consolidated Balance Sheets December 31, December 31, (In thousands, except share and per share data) 2025 2024 Assets Current assets: Cash and cash equivalents $ 635,347 $ 177,980 Marketable investment securities 249,134 — Trade accounts receivable, net of allowance for credit losses of $1 and $176 1,587 1,420 Inventories 2,776 1,686 Prepaid expenses and other current assets 7,388 3,954 Total current assets 896,232 185,040 Property and equipment, net 7,841 4,133 Operating lease right-of-use assets 6,518 7,261 Intangible assets, net 915 490 Other non-current assets, net 4,307 2,929 Total assets $ 915,813 $ 199,853 Liabilities and stockholders' equity Current liabilities: Trade accounts payable $ 950 $ 815 Accrued expenses and other current liabilities 15,838 8,784 Current portion of operating lease liabilities 1,448 1,512 Loans payable, net, current 134 348 Deferred revenue, current 2,778 18,686 Total current liabilities 21,148 30,145 Warrant liabilities — 69,875 Operating lease liabilities, net of current portion 6,050 6,389 Loans payable, net, non-current 35,825 30,128 Deferred revenue, non-current 560 670 Total liabilities 63,583 137,207 Commitments and contingencies (Note 14) Stockholders' equity: Common stock, par value $0.0001 per share; 675,000,000 shares authorized at both December 31, 2025 and December 31, 2024; 358,741,605 shares and 266,595,867 shares issued and outstanding as of December 31, 2025 and December 31, 2024, respectively. 35 27 Additional paid-in capital 1,843,218 700,069 Accumulated deficit (982,002) (626,940) Accumulated other comprehensive loss (9,021) (10,510) Total stockholders' equity 852,230 62,646 Total liabilities and stockholders’ equity $ 915,813 $ 199,853 The accompanying notes are an integral part of these consolidated financial statements. 86 D-Wave Quantum Inc.
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Our continuous software enhancements translate to production-grade reliability, access and security to support customers’ production deployments. Our solutions drive tangible business outcomes such as lower costs, increased operational efficiency and increased revenue opportunities, and our technical roadmap is focused on delivering product advancements that directly impact customer return on investment (“ROI”), now and in the future.
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Consolidated Statements of Operations and Comprehensive Loss Year Ended December 31, (In thousands, except share and per share data) 2025 2024 Revenue $ 24,587 $ 8,827 Cost of revenue 4,281 3,264 Total gross profit 20,306 5,563 Operating expenses: Research and development 50,734 35,300 General and administrative 41,186 32,422 Sales and marketing 28,754 15,064 Total operating expenses 120,674 82,786 Loss from operations (100,368) (77,223) Other income (expense), net: Interest income 24,115 1,738 Interest expense (4,013) (3,897) Change in fair value of Term Loan — (645) Gain (loss) on investment in marketable securities, net (159) 1,495 Change in fair value of warrant liabilities (270,540) (68,245) Other income (expense), net (4,097) 2,898 Total other income (expense), net (254,694) (66,656) Net loss $ (355,062) $ (143,879) Net loss per share, basic and diluted $ (1.11) $ (0.75) Weighted-average shares used in computing net loss per share, basic and diluted 321,202,025 192,129,049 Comprehensive loss: Net loss $ (355,062) $ (143,879) Other comprehensive income (loss), net of tax: Foreign currency translation adjustment 1,335 7 Unrealized gains on available-for-sale securities 154 — Total other comprehensive income (loss), net of tax 1,489 7 Net comprehensive loss $ (353,573) $ (143,872) The accompanying notes are an integral part of these consolidated financial statements. 87 D-Wave Quantum Inc.
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Our cloud-based approach offers customers real-time access to our technology, helping them not only find answers to their computationally challenging problems, but also better navigate unexpected disruptions that arise in daily business.
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Consolidated Statements of Stockholders’ Equity For the Year Ended December 31, 2025 Common stock Additional paid-in capital Accumulated deficit Accumulated other comprehensive loss Total stockholders' equity (In thousands, except share data) Shares Amount Balances at December 31, 2024 266,595,867 $ 27 $ 700,069 $ (626,940) $ (10,510) $ 62,646 Issuance of common stock in connection with the Lincoln Park Purchase Agreement 3,873,113 — 37,787 — — 37,787 Issuance of common stock in at-the-market offerings, net of issuance costs 50,948,852 5 536,736 — — 536,741 Issuance of common stock in connection with the Employee Stock Purchase Plan 129,748 — 769 — — 769 Issuance of common stock in connection with exercise of stock options and vesting of RSUs 11,535,642 1 11,431 — — 11,432 Issuance of common stock in connection with exercise of warrants 25,658,383 2 543,674 — — 543,676 Stock-based compensation — — 23,011 — — 23,011 Tax withholding related to vesting of restricted stock units — — (10,259) — — (10,259) Other comprehensive loss — — — — 1,489 1,489 Net loss — — — (355,062) — (355,062) Balances at December 31, 2025 358,741,605 $ 35 $ 1,843,218 $ (982,002) $ (9,021) $ 852,230 The accompanying notes are an integral part of these consolidated financial statements. 88 D-Wave Quantum Inc.
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We believe our recently announced initiative to develop and bring to market applications that combine the power of generative AI and quantum computing technologies will further extend our customer value, as we launch the commercial era of quantum AI.
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Consolidated Statements of Stockholders’ Equity (Deficit) For the Year Ended December 31, 2024 Common stock Additional paid-in capital Accumulated deficit Accumulated other comprehensive loss Total stockholders' equity (deficit) (In thousands, except share data) Shares Amount Balances at December 31, 2023 161,113,744 $ 16 $ 469,081 $ (483,061) $ (10,517) $ (24,481) Issuance of common stock in connection with the Lincoln Park Purchase Agreement 34,860,416 3 44,282 — — 44,285 Issuance of common stock in connection with the ATM agreement, net of issuance costs 65,388,915 7 169,899 — — 169,906 Issuance of common stock in connection with the Employee Stock Purchase Plan 487,782 1 424 — — 425 Issuance of common stock in connection with exercise of stock options and vesting of RSUs 4,745,010 — 1,724 — — 1,724 Stock-based compensation — — 17,801 — — 17,801 Tax withholding related to vesting of restricted stock units — — (3,142) — — (3,142) Foreign currency translation adjustment, net of tax — — — — 7 7 Net loss — — — (143,879) — (143,879) Balances at December 31, 2024 266,595,867 $ 27 $ 700,069 $ (626,940) $ (10,510) $ 62,646 The accompanying notes are an integral part of these consolidated financial statements. 89 D-Wave Quantum Inc.
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Our efforts across every facet of the business—from scientific research to processor development and hybrid solver advancements to production deployment support—remain squarely focused on helping our customers succeed in realizing value from quantum computing. 6 Introduction to Quantum Computing While classical computing technology has delivered significant advancements in performance, it has limitations.
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Consolidated Statements of Cash Flows Year Ended December 31, (in thousands) 2025 2024 Cash flows from operating activities: Net loss $ (355,062) $ (143,879) Adjustments to reconcile net loss to cash used in operating activities: Depreciation and amortization 1,563 1,109 Stock-based compensation 22,657 15,661 Amortization of operating right-of-use assets 743 823 Provision for excess and obsolete inventory 9 134 Non-cash interest income (3,947) — Non-cash interest expense 3,921 (1,441) Change in fair value of warrant liabilities 270,540 68,245 Change in fair value of Term Loan — 645 Loss (gain) on marketable equity securities 159 (1,495) Unrealized foreign exchange loss (gain) 1,836 (3,307) Other noncash items 267 — Change in operating assets and liabilities: Trade accounts receivable (204) 137 Inventories (2,398) (215) Prepaid expenses and other current assets (585) (1,580) Trade accounts payable 268 (570) Accrued expenses and other current liabilities 6,940 5,520 Deferred revenue (16,018) 16,608 Operating lease liability (745) 293 Other non-current assets, net (1,926) 669 Net cash used in operating activities (71,982) (42,643) Cash flows from investing activities: Purchase of property and equipment (3,862) (2,106) Purchases of marketable debt securities (247,787) — Purchase of convertible note — (1,000) Proceeds from recovery of previously written-off convertible note 959 — Sales of marketable securities — 254 Expenditures for internal-use software (445) (289) Net cash used in investing activities (251,135) (3,141) Cash flows from financing activities: Proceeds from the issuance of common stock pursuant to the Lincoln Park Purchase Agreement 37,787 44,285 Proceeds from the issuance of common stock in at-the-market offerings, net of issuance costs 536,741 169,906 Proceeds from issuance of common stock upon exercise of warrants 202,923 — Proceeds from the issuance of common stock upon exercise of stock options 11,432 1,347 Proceeds from common stock issued under the Employee Stock Purchase Plan 769 424 Payment of tax withheld pursuant to stock-based compensation settlements (10,259) (3,142) Debt payment for Term Loan — (30,000) Repayments on TPC loan (365) (370) Proceeds from equipment financing 412 — Payments for debt issuance costs (248) — Repayment of the equipment financing (43) — Net cash provided by financing activities 779,149 182,450 Effect of exchange rate changes on cash and cash equivalents 1,335 7 Net increase in cash and cash equivalents 457,367 136,673 Cash and cash equivalents at beginning of period 177,980 41,307 Cash and cash equivalents at end of period $ 635,347 $ 177,980 Supplemental disclosures of cash flow information: Cash Paid for Interest $ 25 $ 5,183 Supplemental disclosure of non-cash investing and financing activities: Capitalized stock-based compensation $ 354 $ 134 Inventory applied to capital projects $ 1,299 $ 473 Reclassification of warrant liability to equity upon exercise $ 340,411 $ — Debt issuance costs settled by issuing freestanding warrants $ 338 $ — Operating lease right-of-use assets exchanged for new operating lease obligations $ — $ 796 Bonus settled in vested share based compensation awards $ — $ 2,006 Unrealized gains (losses) on available-for-sale securities included in other comprehensive loss $ 154 $ — Stock option exercise proceeds in transit $ — $ 377 The accompanying notes are an integral part of these consolidated financial statements. 90 D-Wave Quantum Inc.
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In classical computation, binary information is encoded in bits that can be in a 0 or 1 state. Classical processors manipulate and transform this binary information to run classical algorithms and perform computations. Still, many important and high-value problems remain difficult or out of reach for classical computers, which creates a demand for quantum computing.
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(“D-Wave Systems”), and certain other affiliated entities through a series of transactions (the “Merger”) pursuant to the definitive agreement entered into on February 7, 2022 (the “Transaction Agreement”). On August 5, 2022, in conjunction with the Merger, DPCM and D-Wave Systems became wholly-owned subsidiaries of, and are operated by, the Company.
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Our quantum computing systems harness quantum mechanics to deliver powerful computational resources. Our systems contain quantum bits (qubits) that can be in a superposition of both 0 and 1 simultaneously, and support entanglement across many qubits. These properties provide computational tools that enable new algorithms and applications for solving problems that are outside the reach of classical computing systems.
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The Company is the world’s first commercial supplier of quantum computers, and the first to offer dual-platform quantum computing products and services, spanning both annealing and gate-model quantum computing technologies. The Company’s superconducting quantum computers provide sub-second response times and can be deployed on-premises or accessed through its Leap quantum cloud service, which offers 99.9% availability and uptime.
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The computational value of quantum computing underpins the promise of even greater societal and business impact, from the creation of new products and identification of new lines of business to solutions unimagined in drug discovery, weather modeling, global supply-chain distribution, financial market portfolio optimization, and new materials.
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Customers apply D-Wave’s technology to address use cases spanning optimization, artificial intelligence, research and more. The Company's current sixth-generation annealing quantum computing system is named Advantage2. D-Wave has four operating facilities, which it leases, in North America. These facilities are located in Burnaby, British Columbia, Richmond, British Columbia, Palo Alto, California, and New Haven, Connecticut. 2.
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As the only quantum computing company in the world building both commercial annealing quantum computing systems and gate-model quantum computing systems, we can help customers benefit from a simplified, cross-platform experience that provides access to the full breadth of potential quantum applications.
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BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The Company has prepared the accompanying consolidated financial statements in accordance with the accounting principles generally accepted in the United States of America ("U.S. GAAP"). Any reference in these notes to applicable guidance is meant to refer to the authoritative U.S.
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This dual-system approach is crucial to serving the full quantum total addressable market (“TAM”), as different types of quantum systems benefit different types of quantum applications: annealing quantum computing systems are optimal for optimization problems; gate-model systems are best for differential equations, such as those in quantum chemistry; and both annealing and gate-model systems can solve linear algebraic and factoring problems, such as those in cryptography.
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GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASUs”) of the Financial Accounting Standards Board (“FASB”) and pursuant to the regulations of the U.S. Securities and Exchange Commission ("SEC"). Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned su bsidiaries.
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As use of quantum computers accelerates, we expect to find an expanding set of use cases for annealing quantum computing systems and for gate-model quantum computing systems. By offering both annealing and gate-model quantum computers, we intend to impact the lifecycles of a broader range of use cases and serve as the only cross-platform solution for enterprise customers.
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All intercompany accounts and transactions have been eliminated in the consolidated financial statements upon consolidation. Use of estimates The preparation of the consolidated financial statements in conformity with U.S.
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For example, in the pharmaceutical sector, annealing quantum computing systems are best suited for patient trial and supply chain optimization, as well as protein folding, while gate-model systems are best suited to assist with drug discovery. Both systems will likely play a role in quantum AI for toxicity mitigation.
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GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in the Company’s consolidated financial statements and accompanying notes as of the date of the consolidated financial statements.
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In manufacturing, new materials may be designed with gate-model systems, while annealing quantum computing systems can be used to optimize factory automation to deliver new products that feature those new materials.
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The most significant estimates and assumptions are used in determining: (i) inputs used to recognize revenue over time relating to hours estimated to complete the remaining performance obligations, (ii) standalone selling prices, (iii) fair value of financial instruments, and (iv) long term revenue forecasts used in the accounting for the SIF Loan (see below and Note 8 for further information).
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By providing both annealing and gate-model quantum computing capabilities, D-Wave plans to address the entire TAM rather than only a portion thereof, unlocking customers’ ability to use annealing and gate-model systems as a single-point solution. Quantum computing gives our customers a set of tools for finding solutions to hard problems.
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These estimates and assumptions are based on current facts, historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources.
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In a June 2024 report by Hyperion Research, most surveyed businesses expect to make a long-term annual commitment of $3 to $6 million toward quantum optimization initiatives.
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On an ongoing basis, management evaluates its estimates as there are changes in circumstances, facts, and experience. The Company’s accounting estimates and assumptions may change over time in response to risks and uncertainties, including uncertainty in the current economic environment due to inflation, tariffs, changes in interest rates and monetary policy, various geopolitical conflicts, and any evolutions thereof.
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The survey also revealed a significant increase in quantum adoption planning, with 21 percent of survey respondents either currently using or planning to put quantum technology into production within the next 12 to 18 months.
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The change could be material in future periods. As of the date of issuance of these consolidated financial statements, the Company is not aware of any specific event or circumstances that would require the Company to update estimates, judgments or revise the carrying value of any assets or liabilities.
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This represents a 50 percent increase in adoption plans over findings in Hyperion Research’s 2022 report, which D-Wave believes indicates growing recognition of quantum computing’s real-world business value. All of this contributes to acceleration in the use of, and demand for, quantum computing.
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Actual results may differ from those estimates or assumptions. 91 Public Warrants and Private Warrants The Company evaluated its outstanding warrants which were issued in exchange for (i) the warrants initially included in the DPCM Units (the " Units ") issued in DPCM’s initial public offering (the “ Public Warrants ”), and (ii) the warrants of DPCM held by CDPM Sponsor Group, LLC (the “ Sponsor ”) that were issued to the Sponsor at the closing of DPCM’s initial public offering (the “ Private Warrants ,” and together with the Public Warrants, the “ Warrants ”), which are discussed in Note 11 - Warrant liabilities , in accordance with ASC 815-40, “Derivatives and Hedging - Contracts in Entity’s Own Equity .” The Public Warrants and Private Warrants were evaluated under ASC 480 and ASC 815 and were classified as liability-classified derivative instruments.
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The need for quantum computing solutions is here today, and we believe D-Wave is well positioned to capture a significant portion of the commercial quantum computing market.
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The Private Warrants did not qualify for the derivative scope exception because certain settlement provisions were dependent on the characteristics of the warrant holder, and the Public Warrants contained provisions that could limit the number of shares issuable in a cashless exercise under certain circumstances.
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Our customers have included a highly diversified global portfolio of blue-chip enterprise companies, including Mastercard, Deloitte, BASF, Unisys, Siemens Healthineers, NTT DOCOMO, Ford Otosan, Interpublic Group, Davidson Technologies, ArcelorMittal, Pattison Food Group (formerly Save-On-Foods), DENSO, BBVA, and NEC Corporation (“NEC”).
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Accordingly, the Warrants were not considered indexed to the Common Shares and were recorded as warrant liabilities at fair value, with changes in fair value recognized in the consolidated statements of operations at each reporting date. When a Warrant is exercised, the associated liability is remeasured at the exercise date and then reclassified to additional paid-in capital.
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In addition, thousands of developers around the globe have built early quantum software applications on our systems in areas as diverse as customer offer allocation, resource scheduling, factory scheduling, vehicle routing, logistics optimization, drug discovery, industrial construction design, portfolio optimization and maintenance, repair and overhaul optimization, plus many more under development, demonstrating increased recognition of the benefits of quantum computing across industries.
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The Public Warrants were measured using quoted market prices and classified as Level 1 fair value measurements, while the Private Warrants were classified as Level 2 fair value measurements based on observable inputs.
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We believe that most commercial quantum computation and successful application development will be hybrid, meaning that problems will be solved using powerful combinations of quantum and classical resources. Much like the value of a graphical processing unit in classical computation, quantum computers are accelerators.
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All the Private Warrants were converted into Public Warrants, all unexercised Public Warrants were redeemed and delisted during the year ended December 31, 2025, and no warrant liabilities remained outstanding as of December 31, 2025.
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Our quantum hybrid approach offers customers solvers that combine quantum and classical computing resources to solve industry scale optimization problems. This enables customers to realize quantum value today, and ensures that they can continue to address increasingly complex problems as the technology grows and their business requirements expand. 7 We have already demonstrated important results.
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Operating segments Operating segments are defined as components of an enterprise for which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance.
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In March 2025, we believe D-Wave became the first in the world to demonstrate quantum supremacy on a useful, real-world problem. This groundbreaking work, which was achieved using our 1,200 qubit Advantage2 quantum computing prototype, was published in a peer-reviewed paper in the esteemed journal, Science.
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The Company’s Chief Executive Officer, who is the chief operating decision maker ("CODM"), reviews financial information on an aggregate basis for allocating resources and evaluating financial performance. As such, the Company views its operations and manages its business in one operating and reportable segment. See Note 17 - Segment and geographic information for additional information .
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D-Wave’s quantum computer performed the complex simulation in minutes and with a level of accuracy that would take nearly one million years using one of the world’s most powerful supercomputers. It also would require more than the world’s annual electricity consumption to solve this problem using that supercomputer, which is built with graphics processing unit (GPU) clusters.
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Foreign currency translation and transactions The Company’s reporting currency is the U.S. Dollar. The functional currency of the Company's international subsidiaries is the currency of their primary economic environment.
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In addition, we have shown in the peer-reviewed paper published in Nature Communications in 2021 that our systems have demonstrated a three-million-times speed-up over the best-known classical approaches on an application in quantum materials simulation.
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All balance sheet accounts of subsidiaries where the functional currency is not the U.S. dollar have been translated into U.S. dollars using the rate of exchange at the respective balance sheet date. Components of the consolidated statements of operation and comprehensive loss have been translated at the average exchange rate for the year or the corresponding period.
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In another peer-reviewed paper published in Nature in 2023, our systems demonstrated a significant speed-up and scaling advantage on approach to optimality for an important class of hard optimization problems.
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Translation gains and losses are recorded in accumulated other comprehensive loss as a component of stockholders’ equity. Gains or losses arising from currency exchange rate fluctuations on transactions denominated in a currency other than the local functional currency are included in the consolidated statements of operations and comprehensive loss.
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We believe that our hybrid quantum computing approach will accelerate the value of quantum computing for enterprises today, and once fully developed, our cross-platform offerings of both annealing and gate-model systems will provide customers with access to quantum computing for all their use cases. We believe we are poised to disrupt and revolutionize the notion of computational power.
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For the years ended December 31, 2025 and 2024, the Company recorded a foreign currency transaction loss of $3.9 million and a gain of $3.0 million, respectively, in other income in its consolidated statements of operations and comprehensive loss. Comprehensive loss Comprehensive loss consists of two components, net loss and other comprehensive loss.
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In turn, we anticipate this will enable business and society to realize the value of quantum computing technology. We are more than our innovative products. We are an organization of professionals across many disciplines and boast distinguished domain experts with decades of experience in their respective fields.
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The Company’s other comprehensive loss consists of foreign currency translation adjustments that result from consolidation of its foreign entities and unrealized gains on available-for-sale securities. Cash and cash equivalents The Company considers all highly liquid investments purchased with an original maturity of 3 months or less to be cash equivalents.
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We believe the maturity of our technologies, our deep professional services expertise, our history of delivering both scientific advancements and new quantum products via cloud services, and our proven track record of building and growing new markets fully equip us to partner with customers on their quantum journeys and to continue to capture a significant portion of the growing market.
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As of December 31, 2025 and 2024, cash consisted of demand deposits, money market funds with no fixed term and government bonds. The amortized cost of these investments approximates their fair value. The Company regularly maintains deposits and money market funds with large and reputable financial institutions in excess of amounts insured by the U.S.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Acquisitions and investments involve a number of risks, such as: • use of resources that are needed in other areas of our business; • in the case of an acquisition, implementation or remediation of controls, procedures and policies of the acquired company; • in the case of an acquisition, difficulty integrating the accounting systems and operations of the acquired company, including potential risks to our corporate culture; • in the case of an acquisition, coordination of product, engineering and selling and marketing functions, including difficulties and additional expenses associated with supporting legacy services and products and hosting infrastructure of the acquired company, as applicable, difficulties associated with supporting new products or services, difficulty converting the customers of the acquired company onto our platform and difficulties associated with contract terms, including disparities in the revenues, licensing, support or professional services model of the acquired company; • in the case of an acquisition, retention and integration of employees from the acquired company; • in the case of an acquisition, past intellectual property infringement or data security issues arising from the acquired company; • unforeseen costs or liabilities; • adverse effects on our existing business relationships with customers as a result of the acquisition or investment; • the possibility of adverse tax consequences; • litigation or other claims arising in connection with the acquired company or investment; and • in the case of foreign acquisitions, the need to integrate operations across different cultures and languages and to address the particular economic, currency, political and regulatory risks associated with specific countries.
Acquisitions and investments involve a number of risks, such as: • use of resources that are needed in other areas of our business; 43 • in the case of an acquisition, implementation or remediation of controls, procedures and policies of the acquired company; • in the case of an acquisition, difficulty integrating the accounting systems and operations of the acquired company, including potential risks to our corporate culture; • in the case of an acquisition, coordination of product, engineering and selling and marketing functions, including difficulties and additional expenses associated with supporting legacy services and products and hosting infrastructure of the acquired company, as applicable, difficulties associated with supporting new products or services, difficulty converting the customers of the acquired company onto our platform and difficulties associated with contract terms, including disparities in the revenues, licensing, support or professional services model of the acquired company; • in the case of an acquisition, retention and integration of employees from the acquired company; • in the case of an acquisition, past intellectual property infringement or data security issues arising from the acquired company; • unforeseen costs or liabilities; • adverse effects on our existing business relationships with customers as a result of the acquisition or investment; • the possibility of adverse tax consequences; • litigation or other claims arising in connection with the acquired company or investment; and • in the case of foreign acquisitions, the need to integrate operations across different cultures and languages and to address the particular economic, currency, political and regulatory risks associated with specific countries.
Our current competitors include: • large, well-established tech companies that generally compete in all of our markets, including Google, Quantinuum, IBM, Microsoft, Intel and AWS; • companies based in countries such as China, Russia, Canada, the United States, Australia and the United Kingdom, and those in the European Union as of the date of this Form 10-K and we believe additional countries in the future; • less-established public and private companies with competing technology, including companies located outside the United States; • existing or new entrants seeking to enter the quantum annealing space; and • new or emerging entrants seeking to develop competing technologies.
Our current competitors include: • large, well-established tech companies that generally compete in all of our markets, including Google, Quantinuum, IBM, Microsoft, Intel and AWS; • companies based in countries such as China, Russia, Canada, the United States, Australia, the United Kingdom and Switzerland, and those in the European Union as of the date of this Form 10-K and we believe additional countries in the future; • less-established public and private companies with competing technology, including companies located outside the United States; • existing or new entrants seeking to enter the quantum annealing space; and • new or emerging entrants seeking to develop competing technologies.
Any claims of intellectual property infringement or other intellectual property violations, even those without merit, could: • be expensive and time consuming to defend; • cause us to cease making, licensing or using our platform or products that incorporate the challenged intellectual property; • require us to modify, redesign, reengineer or rebrand our platform or products, if feasible; • cause significant delays in introducing new or enhanced services or technology; • divert management’s attention and resources; or • require us to enter into royalty or licensing agreements in order to obtain the right to use a third party’s intellectual property.
Any claims of intellectual property infringement or other intellectual property violations, even those without merit, could: 50 • be expensive and time consuming to defend; • cause us to cease making, licensing or using our platform or products that incorporate the challenged intellectual property; • require us to modify, redesign, reengineer or rebrand our platform or products, if feasible; • cause significant delays in introducing new or enhanced services or technology; • divert management’s attention and resources; or • require us to enter into royalty or licensing agreements in order to obtain the right to use a third party’s intellectual property.
Evolving and scaling our business and operations places increased demands on our management as well as our financial and operational resources to: • effectively manage organizational change; • design scalable processes; • accelerate and/or refocus research and development activities; • expand supply chain and distribution capacity, and ultimately expand manufacturing capacity; • increase sales and marketing efforts; • scale and manage our professional services; • broaden customer-support and services capabilities; • maintain or increase operational efficiencies; • scale support operations in a cost-effective manner; • implement appropriate operational and financial systems; and • maintain effective financial disclosure controls and procedures.
Evolving and scaling our business and operations places increased demands on our management as well as our financial and operational resources to: • effectively manage organizational change; • design scalable processes; • accelerate and/or refocus research and development activities; • expand supply chain and distribution capacity, and ultimately expand manufacturing capacity; • increase sales and marketing efforts; • scale and manage our professional services; • broaden customer-support and services capabilities; • maintain or increase operational efficiencies; • scale support operations in a cost-effective manner; • implement appropriate operational and financial systems; and 34 • maintain effective financial disclosure controls and procedures.
See Item 5, " Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities ." General Risk Factors Our business is exposed to risks associated with litigation and may become subject to litigation, investigations and regulatory proceedings including product liability claims, which could harm our financial condition and liquidity if we are not able to successfully defend or insure against such claims.
See Item 5, " Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities ." 55 General Risk Factors Our business is exposed to risks associated with litigation and may become subject to litigation, investigations and regulatory proceedings including product liability claims, which could harm our financial condition and liquidity if we are not able to successfully defend or insure against such claims.
For example, we may face additional risks relating to: 37 • lack of familiarity and burdens and complexity involved with complying with multiple, conflicting and changing foreign laws, standards, regulatory requirements, tariffs, export controls and other barriers; • difficulties in ensuring compliance with countries’ multiple, conflicting and changing privacy, data security, international trade, customs and sanctions laws; • differing technology standards; and • new and uncertain protection for intellectual property rights in some countries.
For example, we may face additional risks relating to: • lack of familiarity and burdens and complexity involved with complying with multiple, conflicting and changing foreign laws, standards, regulatory requirements, tariffs, export controls and other barriers; • difficulties in ensuring compliance with countries’ multiple, conflicting and changing privacy, data security, international trade, customs and sanctions laws; • differing technology standards; and • new and uncertain protection for intellectual property rights in some countries.
Our ability to produce and scale our annealing and gate model quantum computers is dependent also upon components we must source from the electronics and semiconductor industries. Shortages or supply interruptions in any of these components will adversely impact our financial performance. Our platform and products depend on the ability to access and integrate with third-party cloud providers.
Our ability to produce and scale our annealing and gate-model quantum computers is dependent also upon components we must source from the electronics and semiconductor industries. Shortages or supply interruptions in any of these components will adversely impact our financial performance. 33 Our platform and products depend on the ability to access and integrate with third-party cloud providers.
In addition, other competitors might be able to compete with us by bundling their other products and services in a way that does not allow us to offer a competitive solution. 31 Additionally, we must be able to achieve our objectives in a timely manner lest quantum computing lose ground to competitors, including competing technologies.
In addition, other competitors might be able to compete with us by bundling their other products and services in a way that does not allow us to offer a competitive solution. Additionally, we must be able to achieve our objectives in a timely manner lest quantum computing lose ground to competitors, including competing technologies.
However, because this is proprietary and trade secret information we cannot or may not want to share, we may lose customers as a result. 34 Real or perceived errors, failures or bugs in our products and services could materially and adversely affect our operating results, financial condition and growth prospects.
However, because this is proprietary and trade secret information we cannot or may not want to share, we may lose customers as a result. Real or perceived errors, failures or bugs in our products and services could materially and adversely affect our operating results, financial condition and growth prospects.
Any change in export or import controls, economic sanctions or related legislation, or change in the countries, governments, persons, or technologies targeted by such restrictions or legislation, could result in decreased use of our platform by customers or in our decreased ability to offer our platform internationally, which would harm our business, operating results and financial condition.
Any change in export or import controls, economic sanctions or related legislation, or change in the countries, governments, persons, or technologies targeted by such restrictions or legislation, could result in decreased use of our products or platform by customers or in our decreased ability to offer our products or platform internationally, which would harm our business, operating results and financial condition.
Our assessments of competitive pricing may not be accurate and we could be underpricing or overpricing our platform and services. Further, in the past we concentrated on selling the hardware needed for customers to run dedicated systems. We have now transitioned from selling systems to selling cloud services and have added professional services as well.
Our assessments of competitive pricing may not be accurate and we could be underpricing or overpricing our platform and services. Further, in the past we concentrated on selling the hardware needed for customers to run dedicated systems. We have now transitioned from selling systems to selling cloud services and professional services as well.
All of these implications could adversely affect our revenue, results of operations, business and financial condition. 41 We are subject to United States, Canadian and foreign anti-corruption, anti-bribery and similar laws, and non-compliance with such laws may subject us to criminal or civil liability and harm our business.
All of these implications could adversely affect our revenue, results of operations, business and financial condition. We are subject to United States, Canadian and foreign anti-corruption, anti-bribery and similar laws, and non-compliance with such laws may subject us to criminal or civil liability and harm our business.
If other companies’ quantum computers reach a broad quantum advantage prior to the time ours reaches such capabilities, it could lead to a loss of customers. If any of these events occur, it could have a material adverse effect on our business, financial condition or results of operations.
If other companies’ quantum computers reach a broad quantum advantage prior to the time ours reach such capabilities, it could lead to a loss of customers. If any of these events occur, it could have a material adverse effect on our business, financial condition or results of operations.
As a result of our international operations, we are subject to a number of United States, Canadian and foreign laws relating to economic sanctions and to export and import controls which presently limit and could further limit our ability to offer our platform in certain jurisdictions or to certain customers.
As a result of our international operations, we are subject to a number of United States, Canadian and foreign laws relating to economic sanctions and to export and import controls which presently limit and could further limit our ability to offer our products or platform in certain jurisdictions or to certain customers.
Any problems with the transmission of increased data and requests could result in harm to our brand or reputation. Our growth has placed, and will likely continue to place, a significant strain on our managerial, administrative, operational, financial and other resources.
Any problems with the transmission of increased data and requests could result in harm to our brand or reputation. 32 Our growth has placed, and will likely continue to place, a significant strain on our managerial, administrative, operational, financial and other resources.
Despite efforts to create security barriers to such threats, it is not feasible, as a practical matter, for us to entirely mitigate these risks, as the techniques used to obtain unauthorized access to or compromise of our systems change frequently.
Despite efforts to create security barriers to such threats, it is not feasible, as a practical matter, for us to entirely mitigate these risks, as the techniques used to obtain unauthorized access to or compromise our systems change frequently.
Furthermore, regulations governing domain names may not protect our trademarks or similar proprietary rights. 43 We enter into confidentiality and intellectual property agreements with our employees and consultants and enter into confidentiality agreements with the parties with whom we have strategic relationships and business alliances.
Furthermore, regulations governing domain names may not protect our trademarks or similar proprietary rights. We enter into confidentiality and intellectual property agreements with our employees and consultants and enter into confidentiality agreements with the parties with whom we have strategic relationships and business alliances.
Item 1A. Risk Factors In this section, unless otherwise specified, the terms “we,” “our,” “us,” “D-Wave,” and “D-Wave Quantum” refer to D-Wave Quantum Inc. and its consolidated subsidiaries.
Item 1A. Risk Factors In this section, unless otherwise specified, the terms the "Company," “we,” “our,” “us,” “D-Wave,” and “D-Wave Quantum” refer to D-Wave Quantum Inc. and its consolidated subsidiaries.
If our products and services fail to deliver customer value to a broader range of customers than classical approaches, our business, financial condition and future prospects may be harmed.
If our products or services fail to deliver customer value to a broader range of customers than classical approaches, our business, financial condition and future prospects may be harmed.
Negative conditions in the general economy in Canada, the U.S. and foreign jurisdictions, including conditions resulting from changes in gross domestic product growth, financial and credit market fluctuations, inflation, tightening of the credit markets, including as a result of bank failures and any resulting issues in the broader U.S. financial system, any higher interest rates, recessions, international trade relations, pandemics (such as the COVID-19 pandemic), political turmoil, uncertain geopolitical conditions, natural catastrophes, warfare, and terrorist attacks could negatively impact our business, financial condition, results of operation, and liquidity or cause a decrease in business investments, including the progress on development of quantum technologies, and negatively affect the growth of our business.
Negative conditions in the general economy in Canada, the U.S. and foreign jurisdictions, including conditions resulting from changes in gross domestic product growth, financial and credit market fluctuations, inflation, tightening of the credit markets, including as a result of bank failures and any resulting issues in the broader U.S. financial system, changes in interest rates and monetary policy, recessions, international trade relations, pandemics (such as the COVID-19 pandemic), political turmoil, uncertain geopolitical conditions, natural catastrophes, warfare, and terrorist attacks could negatively impact our business, financial condition, results of operation, and liquidity or cause a decrease in business investments, including the progress on development of quantum technologies, and negatively affect the growth of our business.
We, therefore, may not be able to engage in any of the foregoing transactions unless we obtain the consent required by these agreements. Furthermore, our future working capital, borrowings or equity financing could be unavailable to repay or refinance the amounts outstanding under any of these agreements. 45 In addition, we may also incur additional indebtedness in the future.
We, therefore, may not be able to engage in any of the foregoing transactions unless we obtain the consent required by these agreements. Furthermore, our future working capital, borrowings or equity financing could be unavailable to repay or refinance the amounts outstanding under any of these agreements. We may also incur additional indebtedness in the future.
A key application of our technology is for optimization problems which, while a very broad market, requires continued research and development in order for our products and services to fully address the optimization market, and if that research and development is not successful this may limit its adoption to a narrow range of customers.
A key application of our quantum annealing technology is for optimization problems which, while a very broad market, requires continued research and development in order for our products and services to fully address the optimization market, and if that research and development is not successful this may limit its adoption to a narrow range of customers.
In addition, the implementation of more restrictive trade policies, including the recent imposition of further tariffs in the U.S. and retaliatory tariffs in response thereto, or the renegotiation of existing international trade agreements could have a material adverse effect on our business operations, financial results and growth plans.
In addition, the implementation of more restrictive trade policies, including the imposition of tariffs in the U.S. and retaliatory tariffs in response thereto, or the renegotiation of existing international trade agreements could have a material adverse effect on our business operations, financial results and growth plans.
There is also a possibility of future tariffs, trade protection measures or other restrictions imposed on our products or on our customers by the United States, China or other countries that could have a material adverse effect on our business.
There is also a possibility of future tariffs, trade protection measures or other restrictions imposed on our products or on our customers by the United States or other countries could have a material adverse effect on our business.
Similarly, geopolitical tensions in and around Ukraine, Israel and other areas of the world have created extreme volatility in the global capital markets and are expected to have further global economic consequences, including disruptions of the global supply chain and energy markets, and further acts of war, terror, or responses to each could result in similar or increased impacts on the global economy.
Similarly, geopolitical tensions in and around Ukraine, Israel, the Middle East, Venezuela and other areas of the world have created extreme volatility in the global capital markets and are expected to have further global economic consequences, including disruptions of the global supply chain and energy markets, and further acts of war, terror, or responses to each could result in similar or increased impacts on the global economy.
If the market for quantum computers in general does not develop as expected, or develops more slowly than expected, our business, prospects, financial condition and operating results could be harmed. 33 We have focused our efforts on the optimization market with our annealing quantum computers, and in the near term expect our business to grow from this market.
If the market for quantum computers in general does not develop as expected, or develops more slowly than expected, our business, prospects, financial condition and operating results could be harmed. Initially, we focused our efforts on the optimization market with our annealing quantum computers, and in the near term expect our business to grow from this market.
The quantum computing industry is in its early stages and is volatile, and if it does not develop, if it develops slower than we expect, if it develops in a manner that does not require use of our products and services, if it encounters negative publicity or if our solution does not drive commercial engagement, the growth of our business will be harmed.
The quantum computing industry is in its early stages and is volatile, and if it does not develop, if it develops slower than we expect, if it develops in a manner that does not require use of our products and services, if it encounters negative publicity or if our solutions do not drive commercial engagement, the growth of our business will be harmed.
If our customers do not perceive the benefits of our solution, or if our solution does not drive customer engagement, then our market may not develop at all, or it may develop more slowly than we expect. If any of these events occur, it could have a material adverse effect on our business, financial condition or results of operations.
If our customers do not perceive the benefits of our solutions, or if our solutions do not drive customer engagement, then our market may not develop at all, or it may develop more slowly than we expect. If any of these events occur, it could have a material adverse effect on our business, financial condition or results of operations.
Delays in future generations of our quantum computers or technical failures at other quantum computing companies could limit market acceptance of our solution. Negative publicity concerning our solution or the quantum computing industry as a whole could limit market acceptance of our solution.
Delays in future generations of our quantum computers or technical failures at other quantum computing companies could limit market acceptance of our solutions. Negative publicity concerning our solutions or the quantum computing industry as a whole could limit market acceptance of our solutions.
Further, even if the estimate of our market opportunity does prove to be accurate, we could fail to capture significant portions, or any portion, of the available markets. Alternatives to our quantum computing products may present themselves and if they do, could substantially reduce the market for our computing services.
Further, even if the estimates of our market opportunity prove to be accurate, we could fail to capture significant portions, or any portion, of the available markets. Alternatives to our quantum computing products may present themselves and if they do, could substantially reduce the market for our computing services.
Risks Related to D-Wave Quantum’s Business and Industry The immature market for quantum computing may lead to us misread market demand and the timeframes it will take to close customer contracts and grow revenue, which would adversely affect our business, results of operations and financial condition.
Risks Related to Our Business and Industry The immature market for quantum computing may lead to us misread market demand and the timeframes it will take to close customer contracts and grow revenue, which would adversely affect our business, results of operations and financial condition.
Any of the factors listed below could have a material adverse effect on your investment in our securities and our securities may trade at prices significantly below the price you paid for them. In such circumstances, the trading price of our securities may not recover and may experience a further decline.
Any of the factors listed below could have a material adverse effect on your investment in our Common Shares and our Common Shares may trade at prices significantly below the price you paid for them. In such circumstances, the trading price of our Common Shares may not recover and may experience a further decline.
The European Union adopted the General Data Protection Regulation (the "GDPR") and the United Kingdom enacted the UK General Data Protection Regulation (which implements the GDPR into UK law); both of which impose significant compliance requirements, including extensive documentation requirements and granting certain rights to individuals to control how businesses collect, use, disclose, retain and leverage information about them or how they obtain consent from them.
The European Union adopted the General Data Protection Regulation (the " GDPR ") and the United Kingdom enacted the UK General Data Protection Regulation and the Data Protection Act 2018 (which implements the GDPR into UK law); all of which impose significant compliance requirements, including extensive documentation requirements and granting certain rights to individuals to control how businesses collect, use, disclose, retain and leverage information about them or how they obtain consent from them.
The stock market in general, and the NYSE in particular, have experienced price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the particular companies affected. The trading prices and valuations of these stocks, and of our securities, may not be predictable.
The stock market in general, and the NYSE in particular, have experienced price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the particular companies affected. The trading prices and valuations of these stocks, and of our Common Shares, may not be predictable.
As a public company, we operate in an increasingly demanding regulatory environment, which requires us to comply with the Sarbanes-Oxley Act, the regulations of the NYSE, the rules and regulations of the SEC, expanded disclosure requirements, accelerated reporting requirements and more complex accounting rules.
As a public company, we operate in a demanding regulatory environment, which requires us to comply with the Sarbanes-Oxley Act, the regulations of the NYSE, the rules and regulations of the SEC, expanded disclosure requirements, accelerated reporting requirements and complex accounting rules.
Even if certain risks were identified in the past, unexpected risks may arise, and previously known risks may materialize in a manner not consistent with prior expectation.
Even if certain risks were identified in the past, unexpected risks may arise, and previously known risks may materialize in a manner not consistent with prior expectations.
A decline in the market price of our securities also could adversely affect our ability to issue additional securities and our ability to obtain additional financing in the future.
A decline in the market price of our Common Shares also could adversely affect our ability to issue additional securities and our ability to obtain additional financing in the future.
In addition, our planned quantum gate system, which is a strategic milestone for our technical roadmap and commercialization, is not yet available for customers and may not become available on the timelines we expect or at all.
In addition, our planned superconducting gate-model system, which is a strategic milestone for our technical roadmap and commercialization, is not yet available for customers and may not become available on the timelines we expect or at all.
As a public company, we are and will continue to be subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as rules adopted, and to be adopted, by the SEC and the NYSE.
We are and will continue to be subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as rules adopted, and to be adopted, by the SEC and the NYSE.
The market price of Common Shares has fluctuated significantly and may continue to do so in response to numerous factors, many of which are beyond its control, including: • actual or anticipated fluctuations in its revenue or other operating metrics; • changes in the financial guidance provided to the public or D-Wave Quantum’s failure to meet this guidance; • failure of securities analysts to initiate or maintain coverage of D-Wave Quantum, changes in financial estimates by any securities analysts who follow D-Wave Quantum, or its failure to meet the estimates or the expectations of investors; • changes in accounting standards, policies, guidelines, interpretations, or principles; • the economy as a whole and market conditions in its industry; • rumors and market speculation involving D-Wave Quantum or other companies in its industry; • announcements by D-Wave Quantum or its competitors of significant innovations, acquisitions, strategic partnerships, joint ventures, or capital commitments; • new laws or regulations or new interpretations of existing laws or regulations applicable to its business; • lawsuits threatened or filed against us; • other events or factors, including those resulting from war, incidents of terrorism, or responses to these events; • the expiration of contractual lock-up or market standoff agreements; and • sales of additional Common Shares by D-Wave Quantum or its stockholders.
The market price of our Common Shares has fluctuated significantly and may continue to do so in response to numerous factors, many of which are beyond our control, including: • actual or anticipated fluctuations in its revenue or other operating metrics; • changes in the financial guidance provided to the public or our failure to meet this guidance; • failure of securities analysts to initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow us, or our failure to meet the estimates or the expectations of investors; • changes in accounting standards, policies, guidelines, interpretations, or principles; • the economy as a whole and market conditions in our industry; • rumors and market speculation involving us or other companies in its industry; • announcements by us or our competitors of significant innovations, acquisitions, strategic partnerships, joint ventures, or capital commitments; • new laws or regulations or new interpretations of existing laws or regulations applicable to our business; • lawsuits threatened or filed against us; • other events or factors, including those resulting from war, incidents of terrorism, or responses to these events; • the expiration of any contractual lock-up or market standoff agreements that may be in effect at a given time; and • sales of additional Common Shares by us or our stockholders.
The determination to pay dividends will depend on many factors, including, among others, D-Wave Quantum’s financial condition, current and anticipated cash requirements, contractual restrictions and financing agreement covenants, solvency tests imposed by applicable corporate law and other factors that D-Wave Quantum’s board of directors may deem relevant.
The determination to pay dividends will depend on many factors, including, among others, our financial condition, current and anticipated cash requirements, contractual restrictions and financing agreement covenants, solvency tests imposed by applicable corporate law and other factors that our board of directors may deem relevant.
Factors that could have an adverse impact on the availability of these components include: • our inability to enter into agreements with suppliers on commercially reasonable terms, or at all; • difficulties of suppliers ramping up their supply of materials to meet our requirements; • a significant increase in the price of one or more components, including due to industry consolidation occurring within one or more component supplier markets or as a result of decreased production capacity at manufacturers; • any reductions or interruption in supply, including due to technological problems, equipment malfunctions, regulatory actions or disruptions on our global supply chain as a result of large scale public health restrictions or geopolitical factors, which we have experienced, and may in the future experience; 32 • financial problems of either contract manufacturers or component suppliers; • significantly increased freight charges, or raw material costs and other expenses associated with our business; • a failure to develop our supply chain management capabilities and recruit and retain qualified professionals; • a failure to adequately authorize procurement of inventory; • a failure to adequately maintain our or our suppliers’ manufacturing equipment; or • a failure to appropriately cancel, reschedule, or adjust our requirements based on our business needs.
Factors that could have an adverse impact on the availability of these components include: • our inability to enter into agreements with suppliers on commercially reasonable terms, or at all; • difficulties of suppliers ramping up their supply of materials to meet our requirements; • a significant increase in the price of one or more components, including due to industry consolidation occurring within one or more component supplier markets or as a result of decreased production capacity at manufacturers; • any reductions, delays or interruption in supply, including due to technological problems, a supplier's decision to re-prioritize their business with us or failure to perform satisfactorily under their agreement with us, equipment malfunctions, regulatory actions, or disruptions on our global supply chain as a result of large scale public health restrictions or geopolitical factors, which we have experienced, and may in the future experience; • financial problems of either contract manufacturers or component suppliers; • significantly increased freight charges, or raw material costs and other expenses associated with our business; • a failure to develop our supply chain management capabilities and recruit and retain qualified professionals; • a failure to adequately authorize procurement of inventory; 37 • a failure to adequately maintain our or our suppliers’ manufacturing equipment; or • a failure to appropriately cancel, reschedule, or adjust our requirements based on our business needs.
The risks discussed below may not prove to be exhaustive and are based on certain assumptions made by us that later may prove to be incorrect or incomplete. We may face additional risks and uncertainties that are not presently known to us, or that are currently deemed immaterial, which may also impair D-Wave Quantum’s business or financial condition.
The risks discussed below may not prove to be exhaustive and are based on certain assumptions made by us that later may prove to be incorrect or incomplete. We may face additional risks and uncertainties that are not presently known to us, or that are currently deemed immaterial, which may also impair our business or financial condition.
Government contracts are also generally subject to greater scrutiny by the government than commercial contracts are by commercial customers. For example, government agencies can initiate reviews, audits and investigations regarding our compliance with government contract requirements.
Government contracts are also generally subject to greater scrutiny by the government than commercial contracts are by commercial customers. For example, in the United States, government agencies can initiate reviews, audits and investigations regarding our compliance with government contract requirements.
This material weakness resulted in errors in the unaudited condensed consolidated financial statements for the quarterly and year to date periods ended September 30, 2023, June 30, 2023, and March 31, 2023 and the consolidated financial statements for the years ended December 2022, 2021, and 2020.
The material weaknesses resulted in errors in the unaudited condensed consolidated financial statements for the quarterly and year to date periods ended September 30, 2023, June 30, 2023, and March 31, 2023 and the consolidated financial statements for the years ended December 2022, 2021, and 2020.
These provisions could have the effect of depriving holders of our Common Shares of an opportunity to sell their Common Shares at a premium over prevailing market prices by discouraging third parties from seeking to obtain control of D-Wave Quantum in a tender offer or similar transaction.
These provisions could have the effect of depriving holders of our Common Shares of an opportunity to sell their Common Shares at a premium over prevailing market prices by discouraging third parties from seeking to obtain control of us in a tender offer or similar transaction.
Risks Related to D-Wave Quantum’s Financial Condition and Status as an Early-Stage Company We are in our growth stage which makes it difficult to forecast our future results of operations and our funding requirements.
Risks Related to Our Financial Condition and Status as an Early-Stage Company We are in our growth stage which makes it difficult to forecast our future results of operations and our funding requirements.
Any additional operating losses may have an adverse effect on our stockholders’ equity and the price of our common stock, and we cannot assure you that we will ever be able to achieve profitability. 26 Even if we achieve profitability, we may not be able to sustain or increase such profitability.
Any additional operating losses may have an adverse effect on our stockholders’ equity and the market price of our Common Shares, and we cannot assure you that we will ever be able to achieve profitability. Even if we achieve profitability, we may not be able to sustain or increase such profitability.
Factors affecting the trading price of our securities may include: • actual or anticipated fluctuations in our quarterly financial results or the quarterly financial results of companies perceived to be similar to it; • changes in the market’s expectations about our operating results; • success of competitors; • our operating results failing to meet the expectation of securities analysts or investors in a particular period; • changes in financial estimates and recommendations by securities analysts concerning D-Wave Quantum or the industries in which D-Wave Quantum operates; • operating and share price performance of other companies that investors deem comparable to D-Wave Quantum; • D-Wave Quantum’s ability to market new and enhanced products and technologies on a timely basis; • changes in laws and regulations affecting our business; • our ability to meet compliance requirements; • commencement of, or involvement in, litigation involving D-Wave Quantum; • changes in D-Wave Quantum’s capital structure, such as future issuances of securities or the incurrence of additional debt; • the volume of Common Shares available for public sale; • any changes in our board of directors or management; • sales of substantial amounts of Common Shares by our directors, executive officers or significant stockholders or the perception that such sales could occur; and • general economic and political conditions such as recessions, interest rates, international currency fluctuations and acts of war or terrorism.
Factors affecting the trading price of our Common Shares may include: • actual or anticipated fluctuations in our quarterly financial results or the quarterly financial results of companies perceived to be similar to us; • changes in the market’s expectations about our operating results; 56 • success of competitors; • our operating results failing to meet the expectation of securities analysts or investors in a particular period; • changes in financial estimates and recommendations by securities analysts concerning us or the industries in which we operate; • operating and share price performance of other companies that investors deem comparable to us; • our ability to market new and enhanced products and technologies on a timely basis; • changes in laws and regulations affecting our business; • our ability to meet compliance requirements; • commencement of, or involvement in, litigation involving us; • changes in our capital structure, such as future issuances of securities or the incurrence of additional debt; • the volume of Common Shares available for public sale; • any changes in our board of directors or management; • sales of substantial amounts of Common Shares by our directors, executive officers or significant stockholders or the perception that such sales could occur; and • general economic and political conditions such as recessions, changes in interest rates and monetary policy, international currency fluctuations and acts of war or terrorism.
In some instances, despite internal testing, we may not be able to identify the cause or causes of these problems or risks within an acceptable period of time. Any errors, bugs or vulnerabilities discovered in our products after it has been deployed, or never generally discovered, could result in interruptions in platform availability, product malfunctioning or data breaches.
In some instances, despite internal testing, we may not be able to identify the cause or causes of these problems or risks within an acceptable period of time. Any errors, bugs or vulnerabilities discovered in our products after deployment, or never generally discovered, could result in interruptions in platform availability, product malfunctioning or data breaches.
The D-Wave Quantum Charter requires, to the fullest extent permitted by law, that, unless D-Wave Quantum consents in writing to the selection of an alternative forum, (a) any derivative action or proceeding brought on behalf of D-Wave Quantum; (b) any claim or cause of action for breach of a fiduciary duty owed by any current or former director, officer, employee, agent or stockholder of D-Wave Quantum to D-Wave Quantum or D-Wave Quantum’s stockholders; (c) any claim or cause of action against D-Wave Quantum or any current or former director, officer or other employee of D-Wave Quantum, arising out of or pursuant to any provision of the DGCL, the D-Wave Quantum Charter or the amended and restated bylaws of D-Wave Quantum (the “ D-Wave Quantum Bylaws ”) (as each may be amended from time to time); (d) any claim or cause of action seeking to interpret, apply, enforce or determine the validity of the D-Wave Quantum Charter or the D-Wave Quantum Bylaws (as each may be amended from time to time, including any right, obligation or remedy thereunder); (e) any claim or cause of action as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware; and (f) any claim or cause of action against D-Wave Quantum or any current or former director, officer or other employee of the corporation, governed by the internal-affairs doctrine or otherwise related to the corporation’s internal affairs, in all cases to the fullest extent permitted by law and subject to the court having personal jurisdiction over the indispensable parties named as defendants.
Our Charter requires, to the fullest extent permitted by law, that, unless we consent in writing to the selection of an alternative forum, (a) any derivative action or proceeding brought on behalf of us; (b) any claim or cause of action for breach of a fiduciary duty owed by any current or former director, officer, employee, agent or stockholder of ours to us or our stockholders; (c) any claim or cause of action against us or any current or former director, officer or other employee of ours, arising out of or pursuant to any provision of the DGCL, our Charter or Bylaws (as each may be amended from time to time); (d) any claim or cause of action seeking to interpret, apply, enforce or determine the validity of our Charter or our Bylaws (as each may be amended from time to time, including any right, obligation or remedy thereunder); (e) any claim or cause of action as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware; and (f) any claim or cause of action against us or any current or former director, officer or other employee of the corporation, governed by the internal-affairs doctrine or otherwise related to the corporation’s internal affairs, in all cases to the fullest extent permitted by law and subject to the court having personal jurisdiction over the indispensable parties named as defendants.
In addition, the export of our software in certain jurisdictions may require governmental authorizations. Various jurisdictions also regulate the import of certain technology, including imposing import permitting and licensing requirements, and have enacted laws that could limit our ability to offer our platform in those countries.
In addition, the export of our products and services in certain jurisdictions may require governmental authorizations. Various jurisdictions also regulate the import of certain technology, including imposing import permitting and licensing requirements, and have enacted laws that could limit our ability to offer our products or platform in those countries.
The D-Wave Quantum Charter contains provisions to limit the ability of others to acquire control of D-Wave Quantum or cause it to engage in change-of-control transactions, including, among other things: • provisions that authorize its board of directors, without action by its stockholders, to issue additional Common Shares and preferred stock with preferential rights determined by its board of directors; • provisions that permit only a majority of its board of directors, the chairperson of the board of directors or the chief executive officer to call stockholder meetings and therefore do not permit stockholders to call special meetings of the stockholders; • provisions generally eliminating stockholders’ ability to act by written consent; • provisions requiring a two-thirds super majority vote to remove a director; and • provisions requiring certain amendments to our governing documents be made by a two-thirds super majority vote.
Our Charter contains provisions to limit the ability of others to acquire control of us or cause us to engage in change-of-control transactions, including, among other things: 54 • provisions that authorize our board of directors, without action by our stockholders, to issue additional Common Shares and preferred stock with preferential rights determined by our board of directors; • provisions that permit only a majority of our board of directors, the chairperson of the board of directors or the chief executive officer to call stockholder meetings and therefore do not permit stockholders to call special meetings of the stockholders; • provisions generally eliminating stockholders’ ability to act by written consent; • provisions requiring a two-thirds supermajority vote to remove a director; and • provisions requiring certain amendments to our governing documents to be made by a two-thirds supermajority vote.
The occurrence of one or more of the events or circumstances described in these risk factors, alone or in combination with other events or circumstances, may have a material adverse effect on the business, cash flows, financial condition and results of operations of D-Wave Quantum.
The occurrence of one or more of the events or circumstances described in these risk factors, alone or in combination with other events or circumstances, may have a material adverse effect on our business, cash flows, financial condition and results of operations.
Many of our customers invest in quantum computing products and services as part of their medium to longer-term strategies to optimize aspects of their business, and significant global disruptions such as the COVID-19 pandemic or geopolitical conflicts may result in potential customers focusing on short-term challenges, resulting in a reduction in their investments in quantum computing.
Many of our customers invest in quantum computing products and services as part of their medium to longer-term strategies to optimize aspects of their business, and significant global disruptions or geopolitical conflicts may result in potential customers focusing on short-term challenges, resulting in a reduction in their investments in quantum computing.
Our management team may not successfully or effectively manage D-Wave Quantum’s transition to a public company that is subject to significant regulatory oversight and reporting obligations under U.S. securities laws.
Our management team may not successfully or effectively manage our continuing transition to a public company that is subject to significant regulatory oversight and reporting obligations under U.S. securities laws.
Near term, our ability to generate revenue will largely be dependent on our ability to continue to develop and produce annealing quantum computers and hybrid quantum-classical solvers that are able to solve customer business problems at scale. Longer term, our ability to generate revenue will also be dependent on our ability to develop, produce and commercialize gate-model quantum computers.
Near term, our ability to generate revenue will largely be dependent on our ability to continue to develop and produce annealing quantum computers and hybrid quantum-classical solvers that are able to solve customer business problems at scale. In addition, our ability to generate revenue will depend on our ability to develop, produce and commercialize gate-model quantum computers.
In making such forecasts, we rely on data provided by industry sources and customers, among other things, that we have not independently verified and such data may not be accurate, and any inaccuracy will affect the accuracy of our forecasts.
In making such forecasts, we rely on data provided by industry sources and customers, among other things, that we have not independently verified and such data may not be accurate, and any inaccuracy will affect the accuracy of our forecasts. The accuracy of our forecasts may also be affected by human error in the interpretation of such data.
The D-Wave Quantum Charter provides, subject to limited exceptions, that the Court of Chancery of the State of Delaware is the sole and exclusive forum for certain stockholder litigation matters, which could limit D-Wave Quantum’s stockholders’ ability to obtain a favorable judicial forum for disputes with D-Wave Quantum or D-Wave Quantum’s directors, officers, employees or stockholders.
Our Charter provides, subject to limited exceptions, that the Court of Chancery of the State of Delaware is the sole and exclusive forum for certain stockholder litigation matters, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, employees or stockholders.
At this time, we have made no commitments or agreements with respect to any such material transactions. We may in the future be adversely affected by future global public health crises such as epidemics or pandemics. Public health crises such as epidemics or pandemics could materially and adversely impact our business.
At this time, except for our acquisition of Quantum Circuits, we have made no commitments or agreements with respect to any such material transactions. We may in the future be adversely affected by future global public health crises such as epidemics or pandemics. Public health crises such as epidemics or pandemics could materially and adversely impact our business.
See “Our products and services are dependent upon our relationship with third-party providers and any disruption of or interference with our use of such third-party providers would adversely affect our business, results of operations and financial condition ” below.
See “ Risks Related to Our Business and Industry— Our products and services are dependent upon our relationship with third-party providers and any disruption of or interference with our use of such third-party providers would adversely affect our business, results of operations and financial condition ” below.
Risks Related to D-Wave Quantum’s Intellectual Property We may be unable to obtain, maintain and protect our intellectual property rights and proprietary information or prevent third parties from making unauthorized use of our technology, which could cause it to lose its competitive advantage. Our intellectual property is important to our business.
Risks Related to Our Intellectual Property We may be unable to obtain, maintain and protect our intellectual property rights and proprietary information or prevent third parties from making unauthorized use of our technology, which could cause us to lose our competitive advantage. Our intellectual property is important to our business.
The choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with D-Wave Quantum or its directors, officers, or other employees, which may discourage such lawsuits against D-Wave Quantum and its directors, officers, and other employees.
The choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, or other employees, which may discourage such lawsuits against us and our directors, officers, and other employees.
D-Wave Quantum’s management will have considerable discretion in the application of its cash, cash equivalents and investments, and its stockholders will not have the opportunity to approve how such funds are being used. If such funds are used for corporate purposes that do not result in an increase to the value of its business, D-Wave Quantum’s stock price could decline.
Our management has considerable discretion in the application of our cash, cash equivalents and investments, and our stockholders do not have the opportunity to approve how such funds are being used. If such funds are used for corporate purposes that do not result in an increase to the value of our business, our stock price could decline.
These government contracts customarily contain provisions that give the government substantial rights and remedies, many of which are not typically found in commercial contracts and which are unfavorable to contractors.
Government contracts customarily contain provisions that give the government substantial rights and remedies, many of which are not typically found in commercial contracts.
In addition to the material weakness identified below, we may discover additional weaknesses in our system of internal financial and accounting controls and procedures that could result in a material misstatement of our financial statements. Our internal control over financial reporting will not prevent or detect all errors and all fraud.
In addition to our previously reported and remediated material weaknesses referred to below, we may discover additional weaknesses in our system of internal financial and accounting controls and procedures that could result in a material misstatement of our financial statements. Our internal control over financial reporting will not prevent or detect all errors and all fraud.
If any of our current or potential partners elect to not utilize our products or services, or reduce their current or potential use of our technology in favor of competing products, we may have to change our product strategies, which could have a material and adverse effect on our business, operating results and financial condition. 29 Currency exchange rate fluctuations may negatively affect our results of operations.
If any of our current or potential partners elect to not utilize our products or services, or reduce their current or potential use of our technology in favor of competing products, we may have to change our product strategies, which could have a material and adverse effect on our business, operating results and financial condition.
Our revenues are denominated in U.S. dollars, while some of our operating expenses, including relating to employees, are incurred in Canadian dollars. As a result, our results of operations will be adversely impacted by an increase in the value of the Canadian dollar relative to the U.S. dollar.
Currency exchange rate fluctuations may negatively affect our results of operations. Our revenues are denominated in U.S. dollars, while some of our operating expenses, including relating to employees, are incurred in Canadian dollars. As a result, our results of operations will be adversely impacted by an increase in the value of the Canadian dollar relative to the U.S. dollar.
We have a history of losses and expect to incur significant expenses and continuing losses for the foreseeable future. Since our inception, we have incurred significant net losses. As of December 31, 2024 and 2023 , the Company had an accumulated deficit of $626.9 million and $483.1 million, respectively.
We have a history of losses and expect to incur significant expenses and continuing losses for the foreseeable future. Since our inception, we have incurred significant net losses. As of December 31, 2025 and 2024 , we had an accumulated deficit of $982.0 million and $626.9 million , respectively.
D-Wave may be required to take write-downs or write-offs, or D-Wave may be subject to restructuring, impairment or other charges that could have a significant negative effect on D-Wave’s financial condition, results of operations and the price of D-Wave’s securities, which could cause you to lose some or all of your investment.
We may be required to take write-downs or write-offs, or may be subject to restructuring, impairment or other charges that could have a significant negative effect on our financial condition, results of operations and the price of our Common Shares, which could cause you to lose some or all of your investment.
In addition, D-Wave Quantum’s ability to pay dividends may be limited by covenants of any existing and future outstanding indebtedness it or its subsidiaries incur. As a result, you may not receive any return on an investment in Common Shares unless you sell Common Shares for a price greater than that which you paid for it.
In addition, our ability to pay dividends may be limited by covenants of any existing and future outstanding indebtedness that we or our subsidiaries incur. As a result, you may not receive any return on an investment in our Common Shares unless you sell your Common Shares for a price greater than that which you paid for them.
If any of the analysts who currently or may in future cover D-Wave Quantum change their recommendation regarding the Common Shares adversely, or provide more favorable relative recommendations about D-Wave Quantum’s competitors, the price of the Common Shares would likely decline.
If any of the analysts who currently or may in future cover us change their recommendation regarding the Common Shares adversely, or provide more favorable relative recommendations about our competitors, the market price of the Common Shares would likely decline.
If any analyst who may cover D-Wave Quantum were to cease coverage of D-Wave Quantum or fail to regularly publish reports on it, D-Wave Quantum could lose visibility in the financial markets, which in turn could cause its share price or trading volume to decline.
If any analyst who may cover us were to cease coverage of us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our share price or trading volume to decline.
Our estimates of the magnitude of the market opportunity, forecasts of market growth and our operating metrics may prove to be inaccurate and may not be indicative of our future growth. Our estimates of market opportunity included in this Form 10-K may prove to be inaccurate and may not be indicative of our future growth or performance.
Our estimates of the magnitude of the market opportunity, forecasts of market growth and our operating metrics may prove to be inaccurate and may not be indicative of our future growth. Our estimates of market opportunity may prove to be inaccurate and may not be indicative of our future growth or performance.
We are subject to export and import controls and economic sanctions laws that could impair our ability to offer our products or make our platform available in some jurisdictions, or subject us to liability if we are not in compliance with applicable laws.
Any non-compliance with such laws may subject us to criminal or civil liability and harm our business. 47 We are subject to export and import controls and economic sanctions laws that could impair our ability to offer our products or make our platform available in some jurisdictions, or subject us to liability if we are not in compliance with applicable laws.
Risks Related to Ownership of the Common Shares D-Wave will have broad discretion in the use of its cash, cash equivalents and investments, and it may invest or spend such amounts in ways with which you may not agree or in ways which may not yield a return.
Risks Related to Ownership of the Common Shares Our management has broad discretion in the use of our cash, cash equivalents and investments, and may invest or spend such amounts in ways with which you may not agree or in ways which may not yield a return.
Pending their use, D-Wave Quantum may invest its cash, cash equivalents and investments in a manner that does not produce income or that loses value.
Pending their use, we may invest our cash, cash equivalents and investments in a manner that does not produce income or that loses value.
D-Wave Quantum has not paid any dividends to its stockholders and has no intention to pay dividends on Common Shares for the foreseeable future. D-Wave Quantum’s board of directors will consider whether or not to institute a dividend policy.
We have not paid any dividends to our stockholders and have no intention to pay dividends on our Common Shares for the foreseeable future. Our board of directors will consider whether or not to institute a dividend policy.
There are increasing and rapidly evolving concerns over the risks of climate change and related environmental sustainability matters. Our operations, business, customers and partners could be adversely affected by climate change. The physical risks of climate change include rising average global temperatures, rising sea levels and an increase in the frequency and severity of extreme weather events and natural disasters.
Our operations, business, customers and partners could be adversely affected by climate change. The physical risks of climate change include rising average global temperatures, rising sea levels and an increase in the frequency and severity of extreme weather events and natural disasters.
Any disruptions or difficulties in implementing or using such a system could adversely affect our controls and harm our business. Moreover, such disruption or difficulties could result in unanticipated costs and diversion of management’s attention.
However, the enhancement and/or implementation of a system have and may continue to result in substantial costs. Any disruptions or difficulties in implementing or using such a system could adversely affect our controls and harm our business. Moreover, such disruption or difficulties could result in unanticipated costs and diversion of management’s attention.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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This includes verifying that encryption is in place both in transit and at rest. Additionally, we require vendors to provide a SOC 2 Type 2 report, which we review to confirm that security controls have been audited and validated. These measures help ensure that third-party vendors maintain appropriate safeguards for handling and sharing confidential information.
This includes verifying that encryption is in place both in transit and at rest. Additionally, we require key vendors to provide a SOC 2 Type 2 report, which we review to confirm that security controls have been audited and validated. These measures help ensure that third-party vendors maintain appropriate safeguards for handling and sharing confidential information.
We assess the risks facing the Company after our controls are accounted for, and then determine mitigation measures for each such risk. Our risk management processes also assess third party risks, and we perform third-party risk management to identify and mitigate risks from third parties such as vendors, suppliers, and other business partners.
We assess the risks facing us after our controls are accounted for, and then determine mitigation measures for each such risk. Our risk management processes also assess third party risks, and we perform third-party risk management to identify and mitigate risks from third parties such as vendors, suppliers, and other business partners.
For additional information regarding risks from cybersecurity threats, please refer to Item 1A, “Risk Factors,” in this Form 10-K. Governance Our board of directors addresses the Company’s cybersecurity risk management as part of its general oversight function.
For additional information regarding risks from cybersecurity threats, please refer to Item 1A, “Risk Factors,” in this Form 10-K. Governance Our board of directors addresses our cybersecurity risk management as part of its general oversight function.
While the Company's Leap TM quantum cloud system holds SOC 2 Type 2 compliance, it's noteworthy that the correlation extends to all our IT systems, even though they are not explicitly within the defined scope. As a result, these interconnected IT systems align with SOC 2 Type 2 standards.
While our Leap quantum cloud system holds SOC 2 Type 2 compliance, it is noteworthy that the correlation extends to all our IT systems, even though they are not explicitly within the defined scope. As a result, these interconnected IT systems align with SOC 2 Type 2 standards.
The Cybersecurity Committee will convene as necessary to address critical or emerging cybersecurity concerns and to ensure alignment on approach.
The Cybersecurity Committee convenes as necessary to address critical or emerging cybersecurity concerns and to ensure alignment on approach.
In the event of an incident, the Company has developed an incident response plan, which sets forth the steps to be followed from incident detection and assessment to mitigation, recovery and notification and reporting, including notifying functional areas (e.g. legal), as well as senior leadership and the Board, as appropriate.
In the event of an incident, we have developed an incident response plan, which we are continuously updating and which sets forth the steps to be followed from incident detection and assessment to mitigation, recovery and notification and reporting, including notifying functional areas (e.g. legal), as well as senior leadership and the Board, as appropriate.
T he Company conducts due diligence prior to engaging a vendor to provide services and requires the vendor to contractually commit to appropriate data protection measures, depending on the nature of the services provided. As part of the software request and vendor evaluation process, we ensure there is a secure method for transmitting data.
We conduct due diligence prior to engaging a vendor to provide services and require the vendor to contractually commit to appropriate data protection measures, depending on the nature of the services provided. As part of the software request and vendor evaluation process, we ensure there is a secure method for transmitting data.
While the board of directors’ audit committee is responsible for overseeing management's risk assessment and risk management policies generally, to enhance oversight and governance in this area, the board of directors has recently established a standing committee (the “Cybersecurity Committee”), that will advise on cybersecurity matters and provide strategic guidance and direction for our cybersecurity program.
While the board of directors’ audit committee is responsible for overseeing management's risk assessment and risk management policies generally, to enhance oversight and governance in this area, the board of directors in 2025 established a standing committee that advises on cybersecurity matters and provides strategic guidance and direction for our cybersecurity program (the “ Cybersecurity Committee ”).
These risk assessments include identification of reasonably foreseeable internal and external risks, the likelihood and potential damage that could result from such risks, and the sufficiency of existing policies, procedures, systems, and safeguards in place to manage such risks.
We also conduct regular risk assessments to identify threats to our information security systems. These risk assessments include identification of reasonably foreseeable internal and external risks, the likelihood and potential damage that could result from such risks, and the sufficiency of existing policies, procedures, systems, and safeguards in place to manage such risks.
The Company’s overall risks and assessments are monitored by a cross functional team composed of members of senior management, security, legal, information technology and financial reporting, which evaluates risks associated with assets such as infrastructure, software, people, processes, and data.
Our Chief Information Security Officer oversees our cybersecurity policies and processes, including those described above. Our overall risks and assessments are monitored by a cross-functional team composed of members of senior management and the security, legal, information technology and financial reporting departments, which evaluates risks associated with assets such as infrastructure, software, people, processes, and data.
A partnership exists between these aforementioned individuals and departments so that identified issues are addressed in a timely manner and incidents are escalated to the appropriate parties as required. The Company’s incident response plan is tested and adjusted regularly or in response to a particular incident or significant threats where appropriate.
A partnership exists between these aforementioned individuals and departments so that identified issues are addressed in a timely manner and incidents are escalated to the appropriate parties as required.
Following these risk assessments, we re-examine our systems and processes to ensure that reasonable safeguards are in place to minimize identified risks and address any issues that arise.
Following these risk assessments, we re-examine our systems and processes to ensure that reasonable safeguards are in place to minimize identified risks and address any issues that arise. Our Chief Information Security Officer works with management to continuously evaluate and address cybersecurity risks in alignment with our business objectives and operational needs.
Our Chief Financial Officer and the head of our IT department, both of whom are primarily responsible for managing our cybersecurity risks, mitigation strategies and responses to any such issues that may arise, collaborate with the Cybersecurity Committee and report to the entire Board on a quarterly basis, or more frequently as needed.
The incident response plan includes escalation thresholds, decision authorities, and post-incident review processes. Our Chief Information Security Officer, who is primarily responsible for managing our cybersecurity risks, mitigation strategies and responses to any such issues that may arise, collaborates with the Cybersecurity Committee and reports to the entire Board on a quarterly basis, or more frequently as needed.
Subsequently, the Company will undertake a meticulous examination of the internal risk register to potentially recalibrate the likelihood of identified risks, taking into consideration the vulnerabilities unearthed by the third-party assessment.
These providers undertake comprehensive evaluations that delineate potential risks, categorized by criticality and associated level of effort. Subsequently, we undertake a meticulous examination of the risks to potentially recalibrate the likelihood of identified risks, taking into consideration the vulnerabilities unearthed by the third-party assessment.
In addition, the Company maintains policies and procedures for backups, business continuity, and disaster recovery, and regularly tests its policies and procedures to ensure they allow for timely recovery and restoration of backups and the availability of critical resources..
In addition, we maintain policies and procedures for backups, business continuity, and disaster recovery, and regularly test our policies and procedures to ensure they allow for timely recovery and restoration of backups and the availability of critical resources. 58 We enlist third-party service providers to support us in conducting information security reviews of our infrastructure, and the evaluation of our company policies.
Item 1C. Cybersecurity Risk management and strategy We have implemented policies and procedures to evaluate, identify, and handle material risks associated with cybersecurity threats. These protocols are integrated into a comprehensive risk register dedicated to our cloud-based platform and internal systems access.
These protocols are integrated into a comprehensive risk register dedicated to our cloud-based platform and internal systems access.
Personnel at all levels receive regular mandatory training on our cybersecurity policies and practices, no less than once per quarter. Key safeguards include, but are not limited to, access controls, authentication, third-party security obligations, and other technical and organizational measures.
Key safeguards include, but are not limited to, access controls, authentication, third-party security obligations, and other technical and organizational measures.
Our Chief Financial Officer oversees the Company’s IT department and has extensive experience in managing IT organizations and securing cybersecurity insurance coverages, which we currently maintain.
Our Chief Information Security Officer oversees our IT department and has extensive experience in managing IT organizations and securing cybersecurity insurance coverages, which we currently maintain. Our Chief Information Security Officer drives our strategic IT initiatives and cybersecurity risk assessments, drawing upon over two decades of enterprise technology management expertise.
The register undergoes an annual review conducted by the internal information technology (IT) department, overseeing cybersecurity protection for our on-premises systems, and the DevOps department, responsible for cybersecurity protection in the cloud. We also conduct regular risk assessments to identify threats to our information security systems.
The register undergoes a review, at least annually, conducted by the internal information technology (" IT ") department, overseeing cybersecurity protection for our on-premises systems, and the DevOps department, responsible for cybersecurity protection in the cloud, and is updated upon material changes, acquisitions, or significant threat activity.
The head of our IT department, who reports to our Chief Financial Officer, works with management to continuously evaluate and address cybersecurity risks in alignment with our business objectives and operational needs. 53 As part of our overall risk management system, we monitor and test our safeguards and train our employees on these safeguards, in collaboration with IT and management.
As part of our overall risk management system, we monitor and test our safeguards and train our employees on these safeguards, in collaboration with IT and management. Personnel at all levels receive regular mandatory training on our cybersecurity policies and practices.
Removed
We enlist third-party service providers to support us in conducting information security reviews of our infrastructure, and the evaluation of our company policies. These providers undertake comprehensive evaluations that delineate potential risks, categorized by criticality and associated level of effort.
Added
Item 1C. Cybersecurity Risk management and strategy We have adopted certain policies and are continuously updating our policies and procedures to evaluate, identify, and handle material risks associated with cybersecurity threats to align with industry and regulatory expectations, including the U.S. Department of Defense's Cybersecurity Maturity Model Certification (CMMC) program.
Removed
The head of our IT department drives our strategic IT initiatives and cybersecurity risks assessments, drawing upon over two decades of enterprise technology management expertise. 54 Our Chief Financial Officer and the head of our IT department oversee our cybersecurity policies and processes, including those described above.
Added
As noted above, this register is reviewed at least annually and updated upon material changes, acquisitions, or significant threat activity.
Added
Our incident response plan, which includes escalation thresholds, decision authorities, and post-incident review processes, is tested and adjusted regularly or in response to a particular incident or significant threats where appropriate. 59

Item 2. Properties

Properties — owned and leased real estate

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We also lease approximately 7,000 square feet of space in Richmond, B.C., outside of Vancouver, under an agreement that expires in December 2028. That facility is used to develop and manufacture proprietary superconducting circuit boards for internal consumption, and for customer sales.
We also lease approximately 7,000 square feet of space in Richmond, British Columbia, outside of Vancouver, under an agreement that expires in December 2028. That facility is used to develop and manufacture proprietary superconducting circuit boards for internal consumption, and for customer sales.
Item 2. Properties We operate three facilities in North America. Our Canadian operations and the Quantum Engineering Center of Excellence is located in Burnaby, B.C., outside of Vancouver, where we lease approximately 42,000 square feet of space under an agreement that expires in December 2033. Most of the facility is used for research and development and manufacturing.
Item 2. Properties We operate four facilities in North America. Our Canadian operations and the Quantum Engineering Center of Excellence is located in Burnaby, British Columbia, outside of Vancouver, where we lease approximately 42,000 square feet of space under an agreement that expires in December 2033. Most of the facility is used for research and development and manufacturing.
Our in-house fabrication activities are performed in a facility in Palo Alto, California, where we lease approximately 6,000 square feet of space under an agreement that expires in June 2026. We believe our current and planned facilities are adequate for the foreseeable future.
As of February 2026, we also lease approximately 18,000 square feet of space for our gate-model focused research and development center in New Haven, Connecticut. Our in-house fabrication activities are performed in a facility in Palo Alto, California, where we lease approximately 6,000 square feet of space under an agreement that expires in June 2027.
Added
However, we plan to transition our corporate headquarters before the end of 2026 from Palo Alto, California to Boca Raton, Florida, and open a key U.S. R&D facility in Boca Raton, under a new lease agreement. We believe our current and planned facilities are adequate for the foreseeable future.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Mine Safety Disclosures Not applicable. 55 Part II
Mine Safety Disclosures Not applicable. 60 Part II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our Common Shares and Warrants began trading on the NYSE under the symbols “QBTS” and “QBTS.WT”, respectively, on August 8, 2022. Prior to that, there was no public trading market for our Common Shares and Warrants.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our Common Shares began trading on the NYSE under the symbol “QBTS” on August 8, 2022. Prior to that, there was no public trading market for our Common Shares.
Any future determination to pay dividends will be made at the discretion of our board of directors, subject to applicable laws and will depend upon, among other factors, our results of operations, financial condition, contractual restrictions and capital requirements. Issuer Purchases of Equity Securities None. Stock Performance Graph Not applicable.
Any future determination to pay dividends will be made at the discretion of our board of directors, subject to applicable laws and will depend upon, among other factors, our results of operations, financial condition, contractual restrictions and capital requirements.
There were no other unregistered sales of equity securities which have not been previously disclosed in a Quarterly Report on Form 10-Q or a Current Report on Form 8-K during the fiscal year ended December 31, 2024. Item 6. [Reserved] 56
There were no other unregistered sales of equity securities which have not been previously disclosed in a Quarterly Report on Form 10-Q or a Current Report on Form 8-K during the fiscal year ended December 31, 2025. Purchases of Equity Securities by the Issuer and Affiliated Purchasers None. Item 6. [Reserved] 61
Such numbers do not include beneficial owners holding our securities through nominee names. Dividend Policy We have never declared or paid any cash dividends on our Common Shares to our stockholders and we do not currently intend to pay any cash dividends on Common Shares for the foreseeable future.
Dividend Policy We have never declared or paid any cash dividends on our Common Shares to our stockholders and we do not currently intend to pay any cash dividends on our Common Shares for the foreseeable future.
The issuances under the Lincoln Park Purchase Agreement were exempt from registration under the Securities Act in reliance on Section 4(a)(2) of the Securities Act, including Regulation D and Rule 506 promulgated thereunder, as transactions by an issuer not involving a public offering.
We relied on exemptions from registration under the Securities Act provided by Rule 506(b) of Regulation D and/or Section 4(a)(2) of the Securities Act with respect to the issuance of such warrants.
Removed
Holders of Record On March 12, 2025, the last reported sales prices of the Common Shares and Warrants were $5.82 and $2.44, respectively. As of March 12, 2025, there were approximately 89 holders of record of our Common Shares, approximately 23 holders of record of our Exchangeable Shares and 1 holders of record of our Warrants.
Added
Holders of Record On February 25, 2026, the last reported sale price of the Common Shares was $19.65. As of February 25, 2026, there were approximately 132 holders of record of our Common Shares and approximately 15 holders of record of our Exchangeable Shares. Such numbers do not include beneficial owners holding our securities through nominee names.
Removed
Unregistered Sales of Equity Securities During the year ended December 31, 2024, we have sold an aggregate number of 34,860,416 Common Shares to Lincoln Park pursuant to the Purchase Agreement (excluding the Common Shares paid in respect of the Commitment Fee) for aggregate consideration of $44.3 million.
Added
Equity Compensation Plan Information Information required by Item 5(a) of Form 10-K regarding our equity compensation plans to be contained in the Proxy Statement (as defined below). Stock Performance Graph Not applicable to Smaller Reporting Companies.
Added
Recent Sales of Unregistered Securities On August 1, 2025, we issued ten-year warrants to purchase an aggregate of 21,563 Common Shares at an exercise price of $16.05 per share, equal to $337,909 of value or 2.4% of the total conditional commitment of $13.8 million, to the lender under the Equipment Financing Agreement.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

64 edited+29 added−24 removed23 unchanged
However, non-cash stock-based compensation expenses may cause upward and downward fluctuations in these costs from time to time. 58 Sales and Marketing Sales and marketing expenses consist primarily of personnel-related expenses, including salaries, benefits and stock-based compensation for personnel, direct advertising, marketing and promotional material costs, sales commission expense, consulting fees and allocated facility costs for our sales and marketing functions.
However, non-cash stock-based compensation expenses may cause upward and downward fluctuations in these costs from time to time. Sales and Marketing Sales and marketing expenses consist primarily of personnel-related expenses, including salaries, benefits and stock-based compensation for personnel, direct advertising, marketing and promotional material costs, sales commission expense, consulting fees and allocated facility costs for our sales and marketing functions.
See Note 8 - Leases to the accompanying consolidated financial statements for further discussion of the nature and timing of cash obligations due under these leases. Critical Accounting Estimates Our consolidated financial statements included in this Form 10-K have been prepared in accordance with accounting principles generally accepted in the United States.
See Note 9 - Leases to the accompanying consolidated financial statements for further discussion of the nature and timing of cash obligations due under these leases. Critical Accounting Estimates Our consolidated financial statements included in this Form 10-K have been prepared in accordance with accounting principles generally accepted in the United States.
Additionally, changes in assumptions, estimates or assessments due to unforeseen events or otherwise could have a material impact on our financial position or results of operations. The critical accounting estimates, assumptions and judgements we believe to have the most significant impact on our audited annual consolidated financial statements are described below.
Additionally, changes in assumptions, estimates or assessments due to unforeseen events or otherwise could have a material impact on our financial position or results of operations. The critical accounting estimates, assumptions and judgments we believe to have the most significant impact on our audited annual consolidated financial statements are described below.
We expect our general and administrative expenses to increase in absolute dollars for the foreseeable future as we continue to invest in more comprehensive compliance and governance functions, increased IT security and compliance, and expanded internal controls over financial reporting in accordance with the Sarbanes-Oxley Act of 2002.
We expect our general and administrative expenses to increase in absolute dollars for the foreseeable future as we continue to invest in more comprehensive compliance and governance functions, increased IT security and compliance, and expanded internal controls over financial reporting in accordance with the Sarbanes-Oxley Act.
Cost of revenue for quantum computing systems includes direct manufacturing costs, such as materials and labor for system production, as well as expenses related to installation, warranty, and support. Additionally, it includes shipping and handling costs associated with delivering the systems. These costs are also expensed as incurred.
Cost of revenue for quantum computing systems includes direct manufacturing costs, such as materials and labor for system production, as well as expenses related to installation, maintenance, and support. Additionally, it includes shipping and handling costs associated with delivering the systems. These costs are also expensed as incurred.
When we determine that our contracts with customers contain multiple performance obligations, for these arrangements, we allocate the transaction price based on the relative standalone selling price (“SSP”) method by comparing the SSP of each distinct performance obligation to the total value of the contract.
When we determine that our contracts with customers contain multiple performance obligations, for these arrangements, we allocate the transaction price based on the relative standalone selling price (“ SSP ”) method by comparing the SSP of each distinct performance obligation to the total value of the contract.
In instances where SSP is not directly observable, such as when we don't sell the product or service separately, we determine the SSP by considering overall pricing objectives and market conditions, including cost plus a reasonable margin.
In instances where SSP is not directly observable, such as when we do not sell the product or service separately, we determine the SSP by considering overall pricing objectives and market conditions, including cost plus a reasonable margin.
If in the future we receive government grants and research incentives, which have historically offset a portion of research and development costs, these costs could decrease in absolute dollars. Also, non-cash share based compensation expenses may cause downward fluctuations in these costs from time to time.
If in the future we receive government grants and research incentives, which have historically offset a portion of research and development costs, these costs could decrease in absolute dollars. Also, non-cash stock-based compensation expenses may cause upward and downward fluctuations in these costs from time to time.
On January 5, 2024, an investee of the Company was acquired for a combination of cash and stock in an observable orderly transaction.
On January 5, 2024, the same former investee of the Company was acquired for a combination of cash and stock in an observable orderly transaction.
The Company drew down two tranches totaling $30.0 million and, on October 22, 2024, the Company had prepaid the entire the Term Loan, including $30.0 million in principal and $4.3 million in accrued PIK interest.
The Company drew down two tranches totaling $30.0 million and, on October 22, 2024, the Company had prepaid the entire Term Loan, including $30.0 million in principal and $4.3 million in accrued payable in kind interest.
Recently Issued and Adopted Accounting Standards A discussion of recent accounting pronouncements is included in Note 2 to our audited consolidated financial statements included elsewhere in this Form 10-K. JOBS Act Accounting Election In April 2012, the JOBS Act was enacted.
Recently Issued and Adopted Accounting Standards A discussion of recent accounting pronouncements is included in Note 2 - Basis of Presentation and Summary of Significant Accounting Policies to our audited consolidated financial statements included elsewhere in this Form 10-K. JOBS Act Accounting Election In April 2012, the JOBS Act was enacted.
Under this agreement, the Company could sell shares of its common stock with an aggregate offering price of up to $100.0 million through or to the Agents. During the year ended December 31, 2024, the Company has received $97.2 million in net proceeds through the issuance of 49,812,287 Common Shares under the Sales Agreement.
Under this agreement, the Company could sell Common Shares with an aggregate offering price of up to $100.0 million through or to the $100M ATM Agents. During the year ended December 31, 2024, the Company received $97.2 million in net proceeds through the issuance of 49,812,287 Common Shares.
Under this agreement, the Company could sell shares of its common stock with an aggregate offering price of up to $75.0 million through or to the Agents. During the year ended December 31, 2024, the Company has received $72.9 million in net proceeds through the issuance of 15,576,628 Common Shares under the Sales Agreement.
Under this agreement, the Company could sell Common Shares with an aggregate offering price of up to $75.0 million through or to the $75M ATM Agents. During the year ended December 31, 2024, the Company received $72.9 million in net proceeds through the issuance of 15,576,628 Common Shares.
Section 107 of the JOBS Act provides that an “emerging growth company” may take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. Therefore, as an emerging growth company we can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.
Section 107 of the JOBS Act provides that an “emerging growth company” may take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards, delaying the adoption of certain accounting standards until those standards would otherwise apply to private companies.
Each agreement may be terminated by: (a) the election of the Agents upon the occurrence of certain adverse events, (b) five business days’ advance notice from the Company to the Agents or five days’ advance notice from any of the Agents to the Company or (c) otherwise by mutual agreement of the parties pursuant to the terms of the Sales Agreement.
Each agreement could have been terminated by: (a) the election of the applicable Agents upon the occurrence of certain adverse events, (b) five business days’ advance notice from the Company to the applicable Agents or five days’ advance notice from any of the applicable Agents to the Company or (c) otherwise by mutual agreement of the parties pursuant to the terms of the applicable sales agreement.
The Purchase Agreement may provide the Company and D-Wave with additional liquidity to fund the business, subject to the conditions set forth in the agreement, including volume limitations tied to periodic market prices, ownership limitations restricting Lincoln Park from owning more than 9.9% of the then total outstanding share of common stock of the Company, par value $0.0001, (the "Common Shares") and a floor price of $1.00 at or below which the Company may not sell to Lincoln Park any Common Shares.
The Purchase Agreement provided the Company with additional liquidity to fund the business, subject to the conditions set forth in the agreement, including volume limitations tied to periodic market prices, ownership limitations restricting Lincoln Park from owning more than 9.9% of the then total outstanding Common Shares and a floor price of $1.00 at or below which the Company could not sell any Common Shares to Lincoln Park.
Macroeconomic Environment Unfavorable conditions in the economy in the United States, Canada and abroad, including conditions resulting from changes in inflationary pressure, gross domestic product growth, financial and credit market fluctuations, banking collapses and related uncertainty, international trade relations, political turmoil, natural catastrophes, outbreaks of contagious diseases, warfare and terrorist attacks on the United States, Europe or elsewhere, including military actions affecting Russia, Ukraine, Israel or elsewhere, could cause a decrease in business investments on our products and negatively affect the growth of our business and our results of operations.
As of December 31, 2025, we had an accumulated deficit of $982.0 million. 63 Macroeconomic Environment Unfavorable conditions in the economy in the United States, Canada and abroad, including conditions resulting from changes in inflationary pressure, gross domestic product growth, financial and credit market fluctuations, banking collapses and related uncertainty, international trade relations, political turmoil, natural catastrophes, outbreaks of contagious diseases, warfare and terrorist attacks on the United States, Europe or elsewhere, including military actions affecting Russia, Ukraine, Israel, Venezuela, the Middle East, or elsewhere, could cause a decrease in business investments in our products and negatively affect the growth of our business and our results of operations.
Lincoln Park Purchase Agreement In conjunction with the Merger with DPCM, the Company and D-Wave Systems entered into a purchase agreement with Lincoln Park Capital Fund, LLC on June 16, 2022 (the "Purchase Agreement") which provides D-Wave the sole right, but not the obligation, to direct Lincoln Park to buy specified dollar amounts up to $150 million of D-Wave's common stock, par value $0.0001 per share through November 1, 2025 .
Liquidity and Capital Resources Lincoln Park Purchase Agreement In conjunction with the Merger with DPCM, the Company and D-Wave Systems entered into a purchase agreement with Lincoln Park Capital Fund, LLC (" Lincoln Park ") on June 16, 2022 (the " Purchase Agreement ") which provided D-Wave the sole right, but not the obligation, to direct Lincoln Park to buy specified dollar amounts up to $150 million of Common Shares through November 1, 2025 .
Cash Flows Used in Investing Activities Net cash used in investing activities during the year ended December 31, 2024 was $3.1 million, an increase of $2.5 million from $0.6 million for the year ended December 31, 2023.
Cash Flows Used in Investing Activities Net cash used in investing activities during the year ended December 31, 2025 was $251.1 million, an increase of $248.0 million from $3.1 million for the year ended December 31, 2024.
We expect our research and development expenses will trend upward on an absolute dollar basis for the foreseeable future as we continue to invest in research and development efforts to enhance the performance of our annealing quantum computers, to complete the development of our gate model quantum computer, and to broaden the functionality, improve the reliability, availability and scalability of our QCaaS cloud platform.
We expect our research and development expenses will trend upward on an absolute dollar basis for the foreseeable future as we continue to invest in research and development efforts to enhance the performance of our annealing quantum computers, further develop our gate-model quantum computer, advance our superconducting bump bond process, upgrade our printed circuit board packaging manufacturing, and broaden the functionality and improve the reliability, availability and scalability of our QCaaS cloud platform.
Our business model is focused primarily on generating revenue from providing customers access to our quantum computing systems via the cloud in the form of quantum computing as a service ("QCaaS") products, and from providing professional services wherein we assist our customers in identifying and implementing quantum computing applications. We have three operating facilities, which we lease, in North America.
Our business model is focused on generating revenue from providing customers access to our quantum computing systems via the cloud in the form of quantum computing as a service (" QCaaS ") products, from providing professional services wherein we assist our customers in identifying and implementing quantum computing applications, as well as selling our quantum computer systems to customers.
Change in fair value of Term Loan The fair value of Term Loan increased by $0.6 million for the year ended December 31, 2024 as compared to a decrease of $0.6 million for the year ended December 31, 2023. On April 13, 2023, the Company entered into a Term Loan with PSPIB.
Change in fair value of Term Loan Change in fair value of Term Loan was zero for the year ended December 31, 2025 as compared to $0.6 million for the year ended December 31, 2024. On April 13, 2023, the Company entered into a Term Loan with PSPIB Unitas Investments II Inc. (" PSPIB ").
Cash Flows The following table sets forth our cash flows for the periods indicated (in thousands): Year Ended December 31, 2024 2023 Net cash provided by (used in): Operating Activities $ (42,643) $ (60,649) Investing Activities (3,141) (630) Financing Activities 182,450 95,636 Effect of exchange rate changes on cash and cash equivalents 7 (115) Net increase in cash and cash equivalents $ 136,673 $ 34,242 62 Cash Flows Used in Operating Activities Our cash flows from operating activities are significantly affected by the growth of our business, and are primarily related to research and development, sales and marketing and general and administrative activities.
Cash Flows The following table sets forth our cash flows for the periods indicated (in thousands): Year Ended December 31, 2025 2024 Net cash provided by (used in): Operating Activities $ (71,982) $ (42,643) Investing Activities (251,135) (3,141) Financing Activities 779,149 182,450 Effect of exchange rate changes on cash and cash equivalents 1,335 7 Net increase in cash and cash equivalents $ 457,367 $ 136,673 Cash Flows Used in Operating Activities Our cash flows from operating activities are significantly affected by the growth of our business, and are primarily related to research and development, sales and marketing and general and administrative activities.
The Company opted for the fair value option for accounting for the Term Loan (see Note 2 to the accompanying consolidated financial statements ).
The Company opted for the fair value option for accounting for the Term Loan (see Note 2 - Basis of Presentation and Summary of Significant Accounting Policies to the accompanying consolidated financial statements ).
As of December 31, 2024, D-Wave had $37.8 million of issuance capacity under the Purchase Agreement. 61 At-the-Market Offerings On May 24, 2024, the Company entered into an at-the-market sales agreement (the "$100M ATM") with Needham & Company, LLC, B. Riley Securities, Inc., and Roth Capital Partners, LLC (the "$100M ATM Agents").
As of December 31, 2025, D-Wave had completed 100% of the issuances available under the Purchase Agreement. At-the-Market Offerings On May 24, 2024, the Company entered into an at-the-market sales agreement (the " $100M ATM ") with Needham & Company, LLC, B. Riley Securities, Inc., and Roth Capital Partners, LLC (the " $100M ATM Agent s").
The increase was primarily driven by increases in personnel costs of $3.3 million, stock-based compensation expense of $0.8 million, travel expenses of $0.4 million and marketing expenses of $0.3 million.
The increase was primarily driven by increases in personnel costs of $7.2 million, marketing expenses of $2.9 million and stock-based compensation expense of $2.2 million.
Cash Flows Provided by Financing Activities Net cash provided by financing activities during the year ended December 31, 2024 was $182.5 million, an increase of $86.8 million from $95.6 million for the year ended December 31, 2023.
Cash Flows Provided by Financing Activities Net cash provided by financing activities during the year ended December 31, 2025 was $779.1 million, an increase of $596.7 million from $182.5 million for the year ended December 31, 2024.
As of December 31, 2024, D-Wave had zero issuance capacity under the ATM Agreement. On December 9, 2024, the Company entered into a new sales agreement (the "$75M ATM") with Needham & Company, LLC, Roth Capital Partners, LLC, B. Riley Securities, Inc., and Craig-Hallum Capital Group, LLC (the "$75M ATM Agents").
As of December 31, 2025, D-Wave had completed 100% of the issuances available under the $100M ATM. On December 9, 2024, the Company entered into its second at-the-market sales agreement (the " $75M ATM "), with Needham & Company, LLC, Roth Capital Partners, LLC, B. Riley Securities, Inc., and Craig-Hallum Capital Group, LLC (the " $75M ATM Agents ").
All other capitalized terms have the meanings ascribed thereto elsewhere in this Form 10-K. All dollar amounts are expressed in thousands of United States dollars (“$”), unless otherwise indicated.
All other capitalized terms have the meanings ascribed thereto elsewhere in this Form 10-K. All dollar amounts are expressed in thousands of United States dollars (“$”), unless otherwise indicated. 62 Overview We are focused on the development and delivery of quantum computing systems, software, and services.
Sales and Marketing Expenses Sales and marketing expenses increased by $4.8 million, or 47%, to $15.1 million for the year ended December 31, 2024 as compared to $10.3 million for the year ended December 31, 2023.
Sales and Marketing Expenses Sales and marketing expenses increased by $13.7 million, or 91%, to $28.8 million for the year ended December 31, 2025 as compared to $15.1 million for the year ended December 31, 2024.
The fair value of the warrant liabilities varies primarily with the trading price of the Public Warrants listed on the New York Stock Exchange (see Note 2 and Note 10 to the accompanying condensed consolidated financial statements).
The fair value of the warrant liabilities varied primarily with the trading price of the Public Warrants, which were listed on the New York Stock Exchange (see Note 2 - Basis of Presentation and Summary of Significant Accounting Policies and Note 11 - Warrant Liabilities to the accompanying consolidated financial statements).
The fair value of the Term Loan varied primarily based on the market yield rate, market yield volatility, and the probabilities of various settlement scenarios. The Company fully repaid and extinguished the Term Loan on October 22, 2024.
The fair value of the Term Loan varied primarily based on the market yield rate, market yield volatility and the probabilities of various settlement scenarios. The Company fully repaid and extinguished the Term Loan on October 22, 2024; as a result, no fair value change was recorded for the year ended December 31, 2025.
See Note 7 to the accompanying consolidated financial statements for additional information concerning the SIF Loan. 64 The accounting treatment for the SIF Loan considers the "sale of future revenues" guidance outlined in ASC 470-10-25.
See Note 8 - Loans payable, net to the audited consolidated financial statements included elsewhere in this Form 10-K for additional information concerning the SIF Loan. 71 The accounting treatment for the SIF Loan considers the "sale of future revenues" guidance outlined in ASC 470-10-25.
For the years ended December 31, 2024 and 2023, our net losses were $143.9 million and $82.7 million, respectively. We expect to continue to incur significant losses for the foreseeable future as we continue to invest in a number of research and development programs as well as a variety of go-to-market initiatives.
We expect to continue to incur significant losses for the foreseeable future as we continue to invest in a number of research and development programs as well as a variety of go-to-market initiatives.
The increase in noncash items was primarily due to an increase in change in fair value of warrant liabilities of $68.5 million, partially offset by a decrease in stock-based compensation of $6.3 million, an increase in unrealized foreign exchange gain of $4.3 million, and a gain on marketable securities of $1.5 million.
The increase in noncash items was primarily due to an increase in change in fair value of warrant liabilities of $202.3 million, an increase in stock-based compensation of $7.0 million, an increase in non-cash interest expense of $5.4 million and an increase in unrealized foreign exchange loss of $5.1 million, partially offset by an increase in non-cash interest income of $3.9 million.
Operating Expenses Research and Development Expenses Research and development expenses decreased by $2.6 million, or 7%, to $35.3 million for the year ended December 31, 2024 compared to $37.9 million for the year ended December 31, 2023.
Operating Expenses Research and Development Expenses Research and development expenses increased by $15.4 million, or 44%, to $50.7 million for the year ended December 31, 2025 compared to $35.3 million for the year ended December 31, 2024.
Gain (loss) on investment in marketable equity securities Gain (loss) on investment in marketable equity securities increased by $1.5 million for the year ended December 31, 2024 as compared to zero for the year ended December 31, 2023.
Gain (loss) on investment in marketable securities, net Gain (loss) on investment in marketable securities, net was a loss of $0.2 million for the year ended December 31, 2025 as compared to a gain of $1.5 million for the year ended December 31, 2024.
Subsequent changes in forecasted cash flows will be accounted for under the catch-up method, which entails adjusting the accrued interest portion of the principal balance through earnings to reflect the effective interest rate.
Subsequent changes in forecasted cash flows will be accounted for under the catch-up method, which entails adjusting the accrued interest portion of the principal balance through earnings to reflect the effective interest rate. The liability is classified as non-current, as the current forecast indicates that repayments will not commence within the 12 months following the balance sheet date.
However, to date, these unfavorable conditions have not affected our business. Key Components of Results of Operations Revenue We currently generate our revenue primarily through subscription sales to access our QCaaS cloud platform and professional services related to the development and implementation of quantum computing applications and delivery of quantum computing application training.
Key Components of Results of Operations Revenue We currently generate our revenue through subscription sales to access our QCaaS cloud platform, professional services related to the development and implementation of quantum computing applications and delivery of quantum computing application training. The Company also sells its superconducting annealing quantum computer systems to customers.
The change is primarily due to an increase in noncash items added back to net loss of $55.6 million and an increase in cash released from working capital of $23.6 million, offset by an increase in net loss of $61.2 million.
The change is primarily due to an increase in net loss of $211.2 million and an increase in cash absorbed by working capital of $35.5 million (primarily related to recognition of deferred revenue), offset by an increase in noncash items added back to net loss of $217.4 million.
The decrease was primarily driven by a decrease in stock-based compensation expenses of $3.2 million, partially offset by an increase in personnel costs of $0.4 million and professional fees of $0.4 million. 59 General and Administrative Expenses General and administrative expenses decreased by $4.6 million, or 12%, to $32.4 million for the year ended December 31, 2024 as compared to $37.0 million for the year ended December 31, 2023.
The increase was primarily driven by an increase in fabrication costs of $5.7 million, personnel costs of $5.3 million and stock-based compensation expense of $2.8 million. 66 General and Administrative Expenses General and administrative expenses increased by $8.8 million, or 27%, to $41.2 million for the year ended December 31, 2025 as compared to $32.4 million for the year ended December 31, 2024.
As of March 14, 2025, D-Wave had zero issuance capacity under the ATM Agreement. Sales under these agreements are classified as "at-the-market" equity offerings under Rule 415(a)(4) of the Securities Act and may be conducted on the NYSE or other trading platforms. The Agents will use commercially reasonable efforts to sell shares based on the Company’s instructions.
As of December 31, 2025, D-Wave had completed 100% of the issuances available under the $400M ATM. Sales under these agreements are classified as "at-the-market" equity offerings under Rule 415(a)(4) of the Securities Act and may be conducted on the NYSE or other trading platforms.
The liability is classified as non-current, as the current forecast indicates that repayments will not commence within the 12 months following the balance sheet date. As the SIF Loan is originated through a government program, a market rate of interest is not imputed in accordance with the scope limitations of ASC 835.
As the SIF Loan is originated through a government program, a market rate of interest is not imputed in accordance with the scope limitations of ASC 835.
The compensation to the Agents is up to 3.0% of the gross sales price, along with expense reimbursements. The Company has also agreed to provide indemnification against certain liabilities under the Securities Act. The Company is not obligated to sell shares under these agreements.
The Company also agreed to provide indemnification against certain liabilities under the Securities Act. The Company was not obligated to sell Common Shares under any of these sales agreements.
As of December 31, 2024, D-Wave had zero issuance capacity under the ATM Agreement. On January 10, 2025, the Company entered into another at-the-market sales agreement (the "$150M ATM") with Needham & Company, LLC, Stifel, Nicolaus & Company, Incorporated, B. Riley Securities, Inc., Roth Capital Partners, LLC, The Benchmark Company, LLC, and Craig-Hallum Capital Group, LLC (the "$150M ATM Agents").
As of December 31, 2025, D-Wave had completed 100% of the issuances available under the $75M ATM. On January 10, 2025, the Company entered into its third at-the-market sales agreement (the " $150M ATM "), with Needham & Company, LLC, Stifel, Nicolaus & Company, Incorporated, B.
Our operating cash flows are also affected by our working capital needs to support growth in personnel-related expenditures and fluctuations in accounts payable, accounts receivable and other current assets and liabilities.
Our operating cash flows are also affected by our working capital needs to support growth in personnel-related expenditures and fluctuations in accounts payable, accounts receivable and other current assets and liabilities. 69 For the year ended December 31, 2025, net cash used in operating activities was $72.0 million, an increase of $29.3 million from $42.6 million for the year ended December 31, 2024.
Change in fair value of warrant liabilities The fair value of warrant liabilities increased by $68.5 million for the year ended December 31, 2024 as compared to a decrease of $0.3 million for the year ended December 31, 2023.
There was no similar activity for the year ended December 31, 2025. 67 Change in fair value of warrant liabilities The change in fair value of warrant liabilities was an increase of $270.5 million for the year ended December 31, 2025 as compared to an increase of $68.2 million for the year ended December 31, 2024.
We have irrevocably elected to avail ourselves of this extended transition period and, as a result, we will not adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies.
As a result, from October 2022 through December 31, 2025, we did not adopt new or revised accounting standards on the relevant dates on which adoption of such standards was required for other public companies.
The decrease in working capital was primarily driven by an increased change in deferred revenue of $15.7 million and an increased change in accrued expenses and other current liabilities of $6.9 million.
The increase in cash absorbed by working capital was primarily driven by a decreased change in deferred revenue of $32.6 million, an increased change in other non-current assets, net of $2.6 million and an increased change in inventories of $2.2 million, partially offset by an increased change in accrued expenses and other current liabilities of $1.4 million and a decreased change in prepaid expenses and other current assets of $1.0 million.
However, quantum computing system revenue may have an outsized impact on our revenue and shift our product mix during the period when such revenue is recognized, though this revenue is expected to be irregular and intermittent.
Meanwhile, quantum computing system revenue may impact our overall product mix in periods when recognized, although this revenue is expected to remain irregular and intermittent.
Cost of Revenue Cost of revenue decreased by $0.9 million, or 21%, to $3.3 million for the year ended December 31, 2024 as compared to $4.1 million for the year ended December 31, 2023. The decrease in cost of revenue was primarily driven by a decrease in non-cash stock-based compensation of $0.6 million and personnel costs of $0.2 million.
Cost of Revenue Cost of revenue increased by $1.0 million, or 31%, to $4.3 million for the year ended December 31, 2025 as compared to $3.3 million for the year ended December 31, 2024. The increase in cost of revenue was primarily due to an increase in infrastructure costs of $0.5 million and system sales-related costs of $0.4 million.
Under this agreement, the Company could sell shares of its common stock with an aggregate offering price of up to $150.0 million through or to the Agents. As of March 14, 2025, the Company has received $146.2 million in net proceeds through the issuance of 24,604,021 Common Shares under the Sales Agreement.
(collectively, the “ $400M ATM Agents ”). Under this agreement, the Company could sell Common Shares with an aggregate offering price of up to $400.0 million through or to the $400M ATM Agents. During the three months ended June 30, 2025, the Company received $390.6 million in net proceeds through the issuance of 26,344,831 Common Shares.
("PSPIB" or the "Lender"), a related party to the Company's largest shareholder as of December 31, 2024, that was initially entered into on April 13, 2023 (the "Closing Date"). The Term Loan, outlined in Note 7 - Loans payable, net to the consolidated financial statements, provided for $50.0 million in three tranches, subject to certain terms and conditions.
Repayment of the Term Loan The Term Loan, outlined in Note 8 - Loans payable, net to the consolidated financial statements, provided for $50.0 million in three tranches, subject to certain terms and conditions.
The decrease was primarily driven by decreases in professional fees of $3.8 million, stock-based compensation expense of $3.2 million and insurance costs of $1.0 million, partially offset by an increase in personnel expenses of $2.3 million and credit loss expenses of $1.3 million.
The increase was primarily driven by system sales of $16.2 million and an increase in professional service revenue of $0.8 million, partially offset by a decrease in QCaaS revenue of $1.2 million.
Other Income (Expense), net Interest Expense Interest expense increased by $3.9 million, or 10,432%, to $3.9 million for the year ended December 31, 2024 as compared to $37.0 thousand for the year ended December 31, 2023. The increase is primarily due to interest expenses related to the Term Loan and the SIF Loan.
Interest Expense Interest expense increased by $0.1 million, or 3%, to $4.0 million for the year ended December 31, 2025 as compared to $3.9 million for the year ended December 31, 2024.
These facilities are located in Burnaby, British Columbia, Richmond, British Columbia, and Palo Alto, California. During the years ended December 31, 2024 and 2023, we generated revenue totaling $8.8 million and $8.8 million, respectively. We have incurred significant operating losses since inception.
R&D facility in Boca Raton, Florida under a new lease agreement. During the years ended December 31, 2025 and 2024, we generated revenue totaling $24.6 million and $8.8 million, respectively. We have incurred significant operating losses since inception.
The increase is primarily due to an increase in proceeds from the issuance of common stock pursuant to the ATM Agreements of $169.9 million, partially offset by an increase in debt repayments of $30.0 million, a decrease in debt financing proceeds of $29.0 million, a decrease in proceeds from the issuance of common stock pursuant to the Purchase Agreement of $19.4 million, a decrease in proceeds of government assistance of $3.0 million and an increase in the payment of tax withheld for common stock issued under stock-based compensation settlements of $2.7 million. 63 Contractual Obligations and Commitments The Company has various operating leases of real estate and equipment.
The increase is primarily due to an increase in proceeds from the issuance of Common Shares pursuant to at-the-market offerings of $366.8 million, an increase in proceeds from issuance of Common Shares upon exercise of Warrants of $202.9 million, the non-recurrence of $30.0 million in debt repayments related to the Term Loan and an increase in proceeds from the issuance of Common Shares upon exercise of stock options of $10.1 million, partially offset by a decrease in proceeds from the issuance of Common Shares pursuant to the Purchase Agreement with Lincoln Park of $6.5 million. 70 Contractual Obligations and Commitments The Company has various operating leases of real estate and equipment.
In addition, as an emerging growth company, we may take advantage of certain reduced disclosure and other requirements that are otherwise applicable generally to public companies. D-Wave Quantum will take advantage of these exemptions until such time that it is no longer an emerging growth company.
In addition, as an emerging growth company from October 2022 through December 31, 2025, we were permitted to take advantage of, and availed ourselves of, certain reduced disclosure and other requirements otherwise applicable generally to public companies.
When the Company sells shares to Lincoln Park, Lincoln Park may resell all, some, or none of those Common Shares at any time or from time to time in its discretion. During the year ended December 31, 2024, the Company has received $44.3 million in proceeds through the issuance of 34,860,416 Common Shares to Lincoln Park under the Purchase Agreement.
For Common Shares sold by the Company to Lincoln Park, Lincoln Park may resell all, some, or none of those Common Shares at any time or from time to time in its sole discretion.
We expect our cost of revenue as a percentage of total revenue to trend downward over time due to a higher mix of QCaaS revenue that has a lower cost to deliver compared to professional service revenue. Operating Expenses Our operating expenses consist of research and development, general and administrative, and sales and marketing expenses.
Over the long term, as QCaaS becomes a larger component of our revenue mix, we expect gross margin to improve, reflecting the lower delivery costs of QCaaS relative to professional services. 64 Operating Expenses Our operating expenses consist of research and development, general and administrative, and sales and marketing expenses.
As the trading price of the Public Warrants appreciates, generally in correlation with the trading price of the Company’s common stock, the fair value of the warrant liabilities increases. 60 Other income (expense), net Other income (expense), net increased by $5.6 million or 606%, to a net other income of $4.6 million for the year ended December 31, 2024 as compared to net other expense of $0.9 million for the year ended December 31, 2023.
Other income (expense), net Other income (expense), net decreased by $7.0 million or 241%, to a net other expense of $4.1 million for the year ended December 31, 2025 as compared to a net other income of $2.9 million for the year ended December 31, 2024.
Results of Operations The following table sets forth our results of operations for the periods indicated (in thousands): Year Ended December 31, Variance (In thousands, except share and per share data) 2024 2023 Amount % Revenue $ 8,827 $ 8,758 $ 69 1 % Cost of revenue 3,264 4,136 (872) (21) % Total gross profit 5,563 4,622 941 20 % Operating expenses: Research and development 35,300 37,878 (2,578) (7) % General and administrative 32,422 37,014 (4,592) (12) % Sales and marketing 15,064 10,276 4,788 47 % Total operating expenses 82,786 85,168 (2,382) (3) % Loss from operations (77,223) (80,546) 3,323 (4) % Other income (expense), net: Interest expense (3,897) (37) (3,860) 10,432 % Change in fair value of Term Loan (645) 640 (1,285) (201) % Term Loan debt issuance costs — (2,118) 2,118 (100) % Gain on investment in marketable securities 1,495 — 1,495 100% Change in fair value of warrant liabilities (68,245) 262 (68,507) (26,148) % Other income (expense), net 4,636 (916) 5,552 (606) % Total other income (expense), net (66,656) (2,169) (64,487) 2,973 % Net loss $ (143,879) $ (82,715) $ (61,164) 74 % Foreign currency translation adjustment 7 (115) 122 (106) % Net comprehensive loss $ (143,872) $ (82,830) $ (61,042) 74 % Revenue Revenue for the year ended December 31, 2024 remained consistent to the prior year.
However, non-cash stock-based compensation expenses may cause upward and downward fluctuations in these costs from time to time. 65 Results of Operations Comparison of the Year Ended December 31, 2025 and 2024 The following table sets forth our results of operations for the periods indicated (in thousands): Year Ended December 31, Variance (In thousands, except share and per share data) 2025 2024 Amount % Revenue $ 24,587 $ 8,827 $ 15,760 179 % Cost of revenue 4,281 3,264 1,017 31 % Total gross profit 20,306 5,563 14,743 265 % Operating expenses: Research and development 50,734 35,300 15,434 44 % General and administrative 41,186 32,422 8,764 27 % Sales and marketing 28,754 15,064 13,690 91 % Total operating expenses 120,674 82,786 37,888 46 % Loss from operations (100,368) (77,223) (23,145) 30 % Other income (expense), net: Interest income 24,115 1,738 22,377 1,288 % Interest expense (4,013) (3,897) (116) 3 % Change in fair value of Term Loan — (645) 645 (100) % Gain (loss) on investment in marketable securities, net (159) 1,495 (1,654) (111) % Change in fair value of warrant liabilities (270,540) (68,245) (202,295) 296 % Other income (expense), net (4,097) 2,898 (6,995) (241) % Total other income (expense), net (254,694) (66,656) (188,038) 282 % Net loss $ (355,062) $ (143,879) $ (211,183) 147 % Foreign currency translation adjustment 1,335 7 1,328 18,971 % Net comprehensive loss $ (353,573) $ (143,872) $ (209,701) 146 % Revenue Revenue increased by $15.8 million, or 179%, to $24.6 million for the year ended December 31, 2025 as compared to $8.8 million for the year ended December 31, 2024.
In order for the Company to issue Common Shares under the Purchase Agreement, the Company's share price must be above the floor price of $1.00. There is no assurance that the floor price will not fall below $1.00 preventing the Company from being able to make sales to Lincoln Park in the future.
In order for the Company to issue Common Shares under the Purchase Agreement, the Company's share price was required to be above the floor price of $1.00. During the year ended December 31, 2025, the Company issued 3,873,113 Common Shares to Lincoln Park under the Purchase Agreement, resulting in $37.8 million of net proceeds.
The increase was primarily driven by the impact of net foreign exchange gains driven by appreciation of the U.S. Dollar against the Canadian Dollar of $4.0 million, and an increase in interest income of $1.4 million due primarily to interest earned on higher cash and cash equivalent balances.
Other Income (Expense), net Interest income Interest income increased by $22.4 million, or 1,288%, to $24.1 million for the year ended December 31, 2025 as compared to $1.7 million for the year ended December 31, 2024. The increase was driven primarily by interest earned on higher cash and cash equivalent balances and the Company’s investment in short-term government debt.
Removed
Overview We are a commercial quantum computing company that provides customers with a full suite of professional services and web-based access to our superconducting quantum computer systems and integrated software environment through our Leap TM quantum cloud service.
Added
We are the world’s first commercial supplier of quantum computers, and the first to offer dual-platform quantum computing products and services, spanning both annealing and gate-model quantum computing technologies. Our superconducting quantum computers provide sub-second response times and can be deployed on-premises or accessed through our Leap quantum cloud service, which offers 99.9% availability and uptime.
Removed
Historically, we have developed our own annealing superconducting quantum computer and associated software, and our current generation quantum system is the D-Wave Advantage TM system.
Added
Customers apply our technology to address use cases spanning optimization, artificial intelligence, research and more. Our current sixth-generation annealing quantum computing system is named Advantage2.
Removed
We are a leader in the development and delivery of quantum computing systems, software and services, and we are the world’s first commercial supplier of quantum computers—and the only company developing both annealing quantum computers and gate-model quantum computers.
Added
We have four operating facilities, which we lease, in North America. These facilities are located in Burnaby, British Columbia, Richmond, British Columbia, Palo Alto, California, and New Haven, Connecticut. In addition, we plan to transition our corporate headquarters before the end of 2026 from Palo Alto, California to Boca Raton, Florida, and open a key U.S.
Removed
As of December 31, 2024, we had an accumulated deficit of $626.9 million.
Added
For the years ended December 31, 2025 and 2024, our operating losses were $100.4 million and $77.2 million, respectively, and our net losses were $355.1 million and $143.9 million, respectively. The differences between operating and net losses were principally due to $270.5 million and $68.2 million, respectively, of mark-to-market charges related to the value of our publicly traded warrants.
Removed
Revenue from quantum computing system is recognized at a point in time when control transfers to the customer, typically upon delivery or installation, based on the terms of the sales contract. 57 We expect that QCaaS revenue, as a percentage of total revenue, will increase due to an increasing number of QCaaS agreements being driven by the completion of professional services engagements yielding production applications that require QCaaS services, as well as by customers that choose to access our Leap TM cloud service without utilizing our professional services organization.
Added
However, to date, these unfavorable conditions have not affected our business. On July 4, 2025, the One Big Beautiful Bill Act (“ OBBBA ”) was enacted, which includes permanent extensions of most expiring Tax Cuts and Jobs Act provisions and international tax changes.
Removed
However, non-cash stock-based compensation expenses may cause upward and downward fluctuations in these costs from time to time.
Added
The Company has assessed the provisions of the OBBBA and determined that the tax changes will not have a material effect on its financial statements for the 2025 fiscal year and are not expected to have a material effect on its financial statements for future periods.
Removed
QCaaS revenue increased by $1.9 million, primarily due to an increase in the average revenue per QCaaS customer. This was offset by a decrease of $1.9 million in professional service revenue, as a result of the timing of closing new professional services engagements.
Added
Revenue from quantum computing system sales is recognized over time during the installation period using an input method, with progress measured based on costs incurred to date relative to total estimated costs, as the Company concludes that the criteria for over-time revenue recognition under ASC 606 are met.
Removed
The Company fully repaid and extinguished the Term Loan on October 22, 2024, including $30.0 million in principal and $4.3 million in accrued payable in kind ("PIK") interest.
Added
Revenue from system upgrade projects is also recognized over time using an input method, measuring progress based on costs incurred to date relative to total estimated costs. This approach is applied to system sales and upgrade projects that span multiple reporting periods and meet the criteria for over-time revenue recognition in accordance with ASC 606.

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