D-Wave Quantum (QBTS) Stock Could Double as Analysts See 110% Upside Ahead

TLDR

• TD Cowen analyst Krish Sankar started coverage on D-Wave Quantum (QBTS) with a Buy rating, noting the company generates actual revenue unlike quantum computing competitors
• Revenue projections show growth from $26 million in 2025 to $135 million by 2028, marking over 70% compound annual growth
• D-Wave’s Advantage systems command $20-40 million per unit with strong margins while cloud services drive recurring revenue
• Recent Quantum Circuit Inc. acquisition positions D-Wave for AI and machine-learning applications with 99.9% fidelity rates
• Wall Street consensus shows 12 out of 12 analysts rating QBTS a Strong Buy with $41.25 average price target

TD Cowen kicked off coverage on D-Wave Quantum (QBTS) with a Buy rating Thursday. Analyst Krish Sankar emphasized the company’s revenue generation as a key differentiator in quantum computing.

D-Wave Quantum Inc., QBTS

Most quantum companies remain stuck in research and development. D-Wave already sells hardware and cloud services to paying customers.

The company’s technology handles real-world tasks like scheduling and logistics optimization. Sankar expects broader enterprise adoption as quantum tools prove their value.

Revenue Growth Trajectory Impresses Analysts

TD Cowen forecasts D-Wave will post $26 million in 2025 revenue. That number should surge to $135 million by 2028, representing more than 70% annual growth.

The business model centers on high-margin enterprise sales. Each Advantage quantum system fetches between $20 million and $40 million.

Cloud services through the Leap platform add recurring revenue. Businesses access quantum computing power without capital equipment purchases.

D-Wave reported 156.2% revenue growth over the past year. Gross margins hit 82.82% as the company scales operations.

Usage metrics show strong momentum. Advantage2 annealing quantum computer usage jumped 314% year-over-year. The Stride hybrid solver saw 114% usage growth in six months.

Strategic Acquisition Expands Capabilities

D-Wave’s purchase of Quantum Circuit Inc. technology could accelerate product development. The QCI DRQ technology delivers fidelity rates exceeding 99.9%.

Higher fidelity opens doors to new applications. Sankar said the acquisition positions D-Wave for AI and machine-learning workloads later this decade.

The move expands the company’s total addressable market. More problem types become solvable as technical capabilities improve.

Balance Sheet Supports Growth Plans

D-Wave maintains a fortress balance sheet. The company holds more cash than debt with a 54.68 current ratio.

The debt-to-equity ratio stands at just 0.06. Financial flexibility enables acquisitions and faster product rollouts.

D-Wave recently landed a $10 million, two-year contract with a Fortune 100 company. The Quantum Computing as a Service deal involves developing multiple quantum applications.

The company plans to relocate headquarters from Palo Alto to Florida’s Boca Raton Innovation Campus by 2026. Florida Atlantic University committed $20 million to purchase an Advantage2 system for its nearby campus.

Sankar, ranked 10th among 12,108 analysts on TipRanks, maintains a 66% success rate with 41.90% average returns. He cautioned that production challenges and competitive threats remain risks.

All 12 Wall Street analysts covering D-Wave rate the stock a Strong Buy. The $41.25 consensus price target suggests 110% upside potential from current levels, though shares trade above InvestingPro’s Fair Value estimate with a $7.26 billion market cap.

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