D-Wave Quantum: The Paradox of Plunging Sales and Surging Orders — and a Two-Pronged Federal Lifeline

D-Wave Quantum's revenue plunged 81% but new orders surged to $33.4M. The firm pursues dual quantum tech (annealing & gate-model) and eyes $100M CHIPS Act funding. Stock volatility high.

It is a picture of radical opposites. D-Wave Quantum’s revenue collapsed 81% to $2.9 million in the first quarter, a hangover from the year-ago sale of its first full quantum computer. Yet new orders hit a record $33.4 million, a nearly 2,000% surge, swelling the backlog to $42.4 million. The stock closed at €19.68, with the shares down 18% year?to?date but still up 39% over twelve months. The chasm between the top line and the order book defines every investment decision now.

While investors try to price that disconnection, the company is pushing forward on two distinct technological fronts. D?Wave has long been identified with quantum annealing, a method for optimisation problems. Now it is also investing heavily in gate?model computing — the approach that researchers believe will unlock complex scientific applications beyond annealing’s reach. A $1.57 million grant from the U.S. National Science Foundation, channelled through Yale’s ERASE project under the National Quantum Virtual Laboratory program, explicitly targets gate?model systems. D?Wave is contributing its superconducting dual?rail gate?model hardware and development toolkits to improve error?correction protocols. This dual?track bet, executed through the Quantum Circuits subsidiary acquired in January 2026, is set to take a concrete next step in September, when D?Wave launches its first gate?model simulator on the Leap cloud platform, supporting up to 21 qubits.

Alongside the research grant, Washington is dangling a far larger carrot. D?Wave has signed a non?binding memorandum of understanding with the Department of Commerce for up to $100 million under the CHIPS and Science Act. The funds are meant to advance critical quantum metrics such as qubit counts and error rates. But the structure is unusual: if the deal closes, the government receives equity in return for its contribution, diluting existing shareholders. The MoU is not a signed contract, and the stock’s ability to rally on a headline about federal money is a reminder of the sector’s extreme volatility — measured at an annualised 92% for D?Wave.

Despite the record order inflow — which included a $20 million deal with Florida Atlantic University — investors remain fixated on cash burn and the path to sustainable profitability. Chief executive Alan Baratz dismisses the revenue plunge as a timing issue, pointing to lumpy hardware sales, while highlighting the backlog as a better gauge of momentum. Technical indicators show no conviction: the relative strength index sits at 45.6, right in neutral territory, and the shares are wedged between the 50?day and 200?day moving averages, some 3?5% below each. From the October 2025 peak of €38.48, the stock has lost 49%; from the March 2026 trough of €11.12, it has bounced 77%.

Analysts see a consensus price target of €32.68, but in a sector where sentiment moves faster than fundamentals, such targets often reflect mood as much as calculation. The government’s dual support — the NSF research grant and the CHIPS MoU — creates a stable policy backdrop, especially after recent executive orders accelerating quantum use for national security. But the market is waiting for a binding contract on the $100 million and, more importantly, for D?Wave to turn its swelling order book into revenue that can sustain a market capitalisation of €7.77 billion. Until then, the stock remains trapped between the promise of state?backed technology and the reality of a revenue freefall.