D-Wave Quantum: Institutional Conviction Meets Legal Scrutiny in a Tale of Two Signals

D-Wave faces securities probes after Q2 miss and CFO exit, but bookings surge 1,120% and backlog grows 668% to $40.7M.

The most telling detail about D-Wave Quantum's current predicament isn't the share-price slide or the freshly opened law-firm investigations — it's the fact that The Manufacturers Life Insurance Company quietly bought roughly 204,700 shares worth about $4.9 million in early September, right as the company's legal exposure was hardening into a formal review.

That institutional vote of confidence cuts against a decidedly murkier picture forming elsewhere. Two prominent US firms — Pomerantz LLP and Kessler Topaz Meltzer & Check LLP — launched investor investigations late last week into potential securities violations at the quantum-computing company. Both are examining whether D-Wave and individual executives ran afoul of capital-markets law, though neither has filed a lawsuit and both remain in the evidence-gathering phase.

What Triggered the Probes

The investigations trace back to a specific sequence of events: the second-quarter earnings miss on August 6 and the abrupt departure of Chief Financial Officer John Markovich, effective September 2. D-Wave reported revenue of $3.08 million for the quarter, falling short of the $4.03 million analysts had penciled in. The adjusted loss per share of $0.10 also came in wider than the $0.08 consensus estimate.

Morningstar's subsequent reporting on those figures helped lay the groundwork for the legal scrutiny now underway. The timing of Markovich's exit — so soon after the earnings release — has amplified concerns, even though no evidence of wrongdoing has emerged. Greg Golkov, previously Senior Vice President of Finance, has stepped in on an interim basis as Principal Financial and Principal Accounting Officer.

Adding another layer to the probes: media reports indicate insiders, including members of the C-suite and a board member, have sold more than one million shares over the past 90 days. Whether those transactions were executed under pre-arranged trading plans or were tax-driven mandatory sales remains unclear from public filings. The law firms are citing the insider activity in connection with the post-earnings share decline and the CFO transition as part of their review — but again, that constitutes examination, not a legal finding.

The Bull Case Hiding in the Backlog

For investors willing to look past the headline noise, the bookings data tells a considerably more constructive story. First-half bookings surged 1,120 percent year over year, while remaining performance obligations — the contracted work still on the books — climbed 668 percent to $40.7 million. Roughly 57 percent of that backlog is expected to convert to revenue within the next twelve months.

Commercial customers accounted for 62.4 percent of quarterly revenue, and the subscription business for quantum-computing services grew 50 percent to $1.9 million. The picture that emerges is of a company selling considerably more than it currently invoices — a dynamic that supports the bull thesis but leaves the crucial question unanswered: can that order momentum translate into actual top-line growth?

That gap between bookings and billings is precisely where the risk lies, and it's the terrain the plaintiffs' firms are now circling.

A Stock That Has Given Back the Rally

The market's verdict so far has been unforgiving. Shares closed Monday at €14.40, roughly 64 percent below the 52-week high of €40.41 reached in October. Since the quarterly report landed more than a month ago, the stock has shed an additional 8.7 percent. Year to date, the decline stands at 36 percent — evidence that investors are treating the earnings miss and the CFO's exit as material concerns rather than background noise.

The stock has moved 16.6 percent since Markovich's resignation became public, underscoring how sensitive the situation has become.

Two Narratives, No Clear Winner

D-Wave now sits at the intersection of competing storylines. One frames the company as an operation gaining genuine commercial traction despite disappointing accounting results — supported by the explosive bookings growth, the expanding subscription base, and institutional buyers like Manulife willing to look past short-term governance questions. The other, advanced by the law firms, casts D-Wave as a company whose communications around its financials and personnel changes warrant closer examination.

Neither interpretation currently dominates. The bookings momentum suggests operational substance beyond the headlines, while the combination of missed expectations, a sudden CFO departure, and active legal reviews argues for caution in assessing how management has handled its disclosures.

For those holding the stock, the position effectively amounts to a wager that the order backlog converts into real revenue — with the legal overhang of the coming months priced in as the cost of that bet.