Why Is D-Wave Quantum Stock A Better Pick Than Peers?

D-Wave (NYSE:QBTS) is commercializing quantum annealing technology—a specialized quantum approach designed for optimization problems. Unlike competitors pursuing universal quantum computing, they’ve chosen a narrower but more immediately practical path. They’re essentially betting that solving specific optimization problems today is more valuable than promising to solve everything tomorrow.

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How real is the revenue?

This is where QBTS gets interesting. It posted $3.74 million in Q3 2025 with nearly 100% year-over-year growth. Trailing twelve-month revenue hit $24.14 million, up dramatically from $8.82 million in 2024. That’s not just growth—that’s acceleration.

Why does this matter? Most quantum companies are science experiments with revenue as an afterthought. D-Wave has actual customers paying actual money for quantum annealing solutions. The revenue is tiny in absolute terms, but the growth trajectory suggests real commercial traction.

What about the valuation absurdity?

Here’s the uncomfortable truth: QBTS trades at a $9.84 billion market cap against $24 million in revenue. That’s a revenue-to-market-cap ratio of 0.25%. You’re paying $408 for every dollar of revenue. Is this insane? On traditional metrics, absolutely. But quantum computing isn’t a traditional market. The question isn’t “what are they worth today?” but “what probability do we assign to quantum computing becoming a massive market, and what’s D-Wave’s position if it does?”

The market is pricing in a significant probability that quantum computing reaches the projected $9 billion market by 2030, and that D-Wave captures a meaningful share.

Why did the stock triple in 2025?

Two factors drove this. First, quantum computing hype reached a fever pitch as technical milestones from various companies convinced investors that the technology is transitioning from research to commercialization. Second, D-Wave’s specific revenue acceleration provided concrete evidence that they’re ahead in the race to monetization.

The market is rewarding execution, and D-Wave is executing better than most quantum pure-plays.

Also, D-Wave announced a $550 million acquisition of Quantum Circuits—more than double their trailing revenue. This is a massive bet. What’s the play? D-Wave recognizes that quantum annealing, while commercially viable today, may have a ceiling. Gate-based quantum computing offers broader applications. By acquiring Quantum Circuits, they’re hedging their technological approach while leveraging their commercial lead. Does this increase risk? Absolutely. Integration challenges, technology overlap, and resource allocation all become complex. But it shows management recognizes the limitations of a single-approach strategy.

How sustainable is the current cash position?

The company ended Q3 2025 with $819 million in cash. Given current burn rates and growth investments, this provides roughly 2-3 years of runway, depending on spending velocity. The Quantum Circuits acquisition will consume resources. But here’s the calculus: if they can maintain revenue growth rates above 80-100% annually while expanding their technology portfolio, they’re building real enterprise value before needing additional capital.

The risk? If revenue growth stalls or the acquisition proves problematic, that cash disappears faster than expected.

What’s the core technology risk?

Quantum annealing solves optimization problems well, but can’t address the broader computational challenges that gate-based quantum computers target. D-Wave has essentially chosen depth over breadth. Can this limitation be overcome? The Quantum Circuits acquisition suggests D-Wave is trying to have it both ways—commercial optimization revenue today, universal quantum computing tomorrow. But technology integration is hard. There’s no guarantee they successfully bridge these approaches.

How does QBTS compare to Rigetti?

Rigetti pursues gate-based quantum computing with an $8.15 billion market cap but only $7.49 million in trailing revenue. They’re chasing the bigger prize (universal quantum computing) but monetizing more slowly.

D-Wave has 3x Rigetti’s revenue with a comparable market cap. The market is valuing both companies similarly despite D-Wave’s superior commercial execution. Why? Because investors believe gate-based quantum computing (Rigetti’s approach) addresses larger markets if technical challenges are solved. Related – Rigetti Computing’s Upside Potential Remains Intact.

D-Wave’s advantage is time—they’re generating revenue now. Their disadvantage is the potential market size if quantum annealing remains niche.

What’s the bull case?

Quantum computing commercializes faster than expected. D-Wave’s revenue growth continues to accelerate as enterprise optimization problems prove valuable. The Quantum Circuits acquisition successfully expands its addressable market. By 2028-2030, they can potentially be generating $200-300 million in revenue with clear paths to profitability, and the market will re-rate the company as a proven quantum leader rather than a speculative play.

What’s the bear case?

Quantum annealing proves too limited for broad adoption. Gate-based competitors achieve technical breakthroughs that make D-Wave’s approach obsolete. The Quantum Circuits acquisition fails to integrate properly. Revenue growth stalls as the optimization market saturates. Cash burns through acquisition costs and expansion before commercialization justifies the spending. The stock reprices to reflect a niche player rather than a quantum leader. Also, see – What’s The Downside Risk For D-Wave Quantum Stock?

So what’s the verdict?

QBTS is a high-conviction bet on quantum computing commercialization with better near-term execution than most peers. The valuation is absurd by traditional metrics but reasonable if quantum computing achieves projected growth and D-Wave maintains market position.

This isn’t a value investment. It’s a speculation on technology transition timing and commercial execution. D-Wave’s advantage is that they’re ahead in monetization. Their risk is whether quantum annealing remains relevant as the technology matures.
If you believe quantum computing will be commercialized within 3-5 years and optimization problems represent a valuable subset of applications, QBTS offers asymmetric upside despite valuation concerns. If you’re skeptical about near-term quantum commercialization or believe gate-based approaches will dominate entirely, the premium is unjustified.

The stock price reflects optimism. The revenue growth suggests that optimism isn’t entirely unfounded. Still, investing in a single stock without comprehensive analysis can be risky. Consider the Trefis Reinforced Value (RV) Portfolio, which has outperformed its all-cap stocks benchmark (combination of the S&P 500, S&P mid-cap, and Russell 2000 benchmark indices) to produce strong returns for investors. Why is that? The quarterly rebalanced mix of large-, mid-, and small-cap RV Portfolio stocks provided a responsive way to make the most of upbeat market conditions while limiting losses when markets head south, as detailed in RV Portfolio performance metrics.

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