D-Wave Announces Successful Completion of $150 Million At-the-Market Equity Offering

Rhea-AI Summary

D-Wave Quantum (NYSE: QBTS) has successfully completed a $150 million at-the-market equity offering program, selling shares at an average price of $6.10 per share, representing a 3.7% premium over the Volume Weighted Average Price during the four-day sale period from January 15th to January 21st.

The company's current cash balance stands at approximately $320 million. The funds will be allocated to working capital and capital expenditures to support ongoing technical development efforts and business operations. According to CEO Dr. Alan Baratz, this equity offering provides the necessary capital to execute their operating plan toward sustained profitability and positive cash flow.

D-Wave, a leader in quantum computing systems, emphasizes its position in commercializing quantum computing with deployed customer applications, quantum computers capable of solving complex problems, and new market developments in quantum optimization and quantum AI.

Positive

• Raised $150 million through ATM offering at 3.7% premium to VWAP
• Strong cash position of $320 million post-offering
• Shares sold at premium price of $6.10 per share

Negative

• Significant shareholder dilution through new share issuance
• Company still not profitable and cash flow negative

Insights

Financial Analyst

The successful completion of D-Wave's $150 million ATM offering at a 3.7% premium to VWAP represents a remarkable achievement in the current market environment, particularly for a quantum computing company. The pricing premium suggests strong institutional investor confidence, while the rapid completion (just 4 trading days) indicates robust demand.

The expanded cash position of $320 million significantly strengthens D-Wave's financial foundation. This capital infusion provides an estimated 24-36 month runway, based on typical burn rates in the quantum computing sector, allowing the company to accelerate its technical development and commercialization efforts without immediate funding concerns.

Three key strategic implications emerge:

• The successful raise at a premium demonstrates market validation of D-Wave's commercial-first approach in quantum computing
• The bolstered balance sheet enhances D-Wave's competitive position against well-funded rivals like IonQ and Rigetti
• The timing suggests management's confidence in near-term commercial milestones, particularly in quantum AI applications

The focus on achieving sustained profitability and positive cash flow indicates a strategic shift from pure growth to operational efficiency. This maturation in business strategy, combined with the successful capital raise, positions D-Wave favorably in the evolving quantum computing landscape.

Technology Industry Analyst

D-Wave's strategic focus on quantum optimization and AI represents a important differentiator in the quantum computing landscape. Their annealing-based approach, distinct from gate-based competitors, has demonstrated particular strength in optimization problems that have immediate commercial applications.

The expansion into quantum AI marks a significant market opportunity. While classical AI faces computational limitations, quantum-enhanced AI could potentially overcome these barriers, particularly in areas like machine learning optimization and large-scale pattern recognition. D-Wave's emphasis on this emerging market suggests they've identified substantial commercial potential.

The company's business evolution is notable through three key developments:

• The introduction of on-premise systems sales opens new revenue streams in high-security and high-performance computing markets
• Their focus on deployed customer applications demonstrates a mature commercial approach rather than just theoretical capabilities
• The emphasis on problems "unreachable with classical computing" indicates successful identification of quantum advantage use cases

This capital raise enables D-Wave to accelerate its technical roadmap while maintaining its first-mover advantage in commercial quantum computing applications. The focus on practical problem-solving and customer deployments positions them uniquely in an industry often criticized for being long on promise but short on practical applications.

Company now has the capital necessary to fully execute its plan to sustained profitability and positive cash flow

PALO ALTO, Calif.--(BUSINESS WIRE)-- D-Wave Quantum Inc. (NYSE: QBTS) (“D-Wave” or the “Company”), a leader in quantum computing systems, software, and services, and the world’s first commercial supplier of quantum computers, today announced that it has successfully completed sales of $150 million in gross proceeds of its common stock pursuant to its previously disclosed $150 million "at-the-market" equity offering program (the “ATM Program”). The $150 million ATM Program, which was filed on January 10, commenced on January 15^th and ended on January 21^st, was completed at an average price per share of $6.10 representing a $0.22 per share, or 3.7%, premium over the Volume Weighted Average Price (“VWAP”) of D-Wave’s common stock (per Bloomberg) for the four days that D-Wave sold common stock. The Company’s current cash balance is approximately $320 million. The funds were used, and will continue to be used, for working capital and capital expenditures in support of D-Wave’s ongoing technical development efforts and business operations.

“We believe that the completion of this equity offering provides us with the capital necessary to fully execute our operating plan to sustained profitability and positive cash flow,” said Dr. Alan Baratz, CEO of D-Wave. “We’ve built an incredibly strong business that we expect will continue to drive value not only for our customers but for our stockholders as well. We are leading the commercialization of quantum computing with customer applications deployed in production, quantum computers that have demonstrated the ability to solve useful problems that are unreachable with classical computing, new go-to-market offerings in quantum optimization and on-premise systems sales, and the development of an important new market – quantum AI. Our momentum is evident.”

About D-Wave Quantum Inc.

D-Wave is a leader in the development and delivery of quantum computing systems, software, and services, and is the world’s first commercial supplier of quantum computers—and the only company building both annealing quantum computers and gate-model quantum computers. Our mission is to unlock the power of quantum computing today to benefit business and society. We do this by delivering customer value with practical quantum applications for problems as diverse as logistics, artificial intelligence, materials sciences, drug discovery, scheduling, cybersecurity, fault detection, and financial modeling. D-Wave’s technology has been used by some of the world’s most advanced organizations including Mastercard, Deloitte, Davidson Technologies, ArcelorMittal, Siemens Healthineers, Unisys, NEC Corporation, Pattison Food Group Ltd., DENSO, Lockheed Martin, Forschungszentrum Jülich, University of Southern California, and Los Alamos National Laboratory.

Forward-Looking Statements

Certain statements in this press release are forward-looking, as defined in the Private Securities Litigation Reform Act of 1995. These statements involve risks, uncertainties, and other factors that may cause actual results to differ materially from the information expressed or implied by these forward-looking statements and may not be indicative of future results. These forward-looking statements are subject to a number of risks and uncertainties, including, among others, various factors beyond management’s control, including the risks set forth under the heading “Risk Factors” discussed under the caption “Item 1A. Risk Factors” in Part I of our most recent Annual Report on Form 10-K or any updates discussed under the caption “Item 1A. Risk Factors” in Part II of our Quarterly Reports on Form 10-Q and in our other filings with the SEC. Undue reliance should not be placed on the forward-looking statements in this press release in making an investment decision, which are based on information available to us on the date hereof. We undertake no duty to update this information unless required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250123582998/en/

Investor Contact:

D-Wave

Kevin Hunt

ir@dwavesys.com

Media Contact:

D-Wave

Alex Daigle

media@dwavesys.com

Source: D-Wave Quantum Inc.

FAQ

How much did D-Wave Quantum (QBTS) raise in its January 2024 ATM offering?

D-Wave raised $150 million in gross proceeds through its ATM offering program completed between January 15th and January 21st, 2024.

What was the average share price for QBTS's ATM offering?

The average price per share was $6.10, representing a 3.7% premium over the Volume Weighted Average Price during the offering period.

What is D-Wave's (QBTS) cash balance after the ATM offering?

D-Wave's cash balance after the ATM offering is approximately $320 million.

How will D-Wave (QBTS) use the proceeds from the ATM offering?

The proceeds will be used for working capital and capital expenditures to support ongoing technical development efforts and business operations.

What is the strategic goal of QBTS's $150 million ATM offering?

The offering aims to provide D-Wave with the capital necessary to execute its operating plan to achieve sustained profitability and positive cash flow.