D-Wave Keeps Delivering Good News—So Why Is It Falling?

Key Points

• D-Wave Quantum shares remain down about a third year-to-date despite numerous technological and business successes.
• The company's bookings and revenue have climbed rapidly alongside gross margin, but operating expenses are also climbing, keeping profitability distant for now.
• With a major new Fortune 100 client and other sales momentum, D-Wave may test investor patience while it works to bring its financials in line with its valuation.

A longtime speculative play in the equally risky and emergent quantum computing industry, D-Wave Quantum Inc. NYSE: QBTS appears to be in a position to further separate the true quantum bulls from investors who merely went along for the ride as the company soared by some 168% in 2025. This is because D-Wave shares, despite a significant rally, have spent almost all of 2026 on either a steep decline or, at best, flat trading. QBTS stock is down by nearly a third year-to-date (YTD).

Some of the reasons for this decline may be obvious: the company failed to meet analyst expectations on both earnings and revenue in the latest quarter. At the same time, rivals like IonQ Inc. NYSE: IONQ may be quietly outperforming in some metrics.

Nonetheless, there are still a number of key positive developments that D-Wave has touted in recent months that might have otherwise helped to reverse this recent downward trend.

Namely, its major bookings growth, a highly prominent new deal, and a sudden expansion into a unique two-pronged technological approach have all so far failed to right the QBTS ship.

D-Wave's Rally, Cut Short in October, Waits for a Reason to Relaunch

To better understand D-Wave's current position, it may help to backtrack to October 2025, when the selloff began. After reaching a high of around $45 per share by mid-month, QBTS plunged to less than half that in the weeks before a modest recovery through the end of the year. The issue for investors trying to assess how D-Wave's rally might reignite is that there wasn't exactly any specific fundamental catalyst for this reversal. It may have simply been a case of shareholders cashing out or otherwise growing concerned that the hype had exceeded D-Wave's real-world achievements at that point.

If the latter is true, it would make sense that D-Wave's rally might resume when it starts to prove that investors have reasons to be excited about the company beyond general market enthusiasm. However, this has yet to happen despite a number of major financial wins, including well over $30 million in bookings so far in 2026, a 265% increase in gross profit for full-year 2025, and an impressive gross margin of nearly 83% last year as well.

Financials and Tech-Side Potential May Still Be Mismatched

The financial performance D-Wave has illustrated is increasingly impressive, but two metrics may still prevent it from convincing investors its $45-per-share price tag is worthwhile. First, revenue remains substantially low at around $25 million last year for a company with a market capitalization of $7 billion, despite nearly tripling year-over-year (YOY). Second, operating expenses for 2025 increased by 46% to roughly $121 million.

Revenue is certainly growing at a faster rate than expenses seem to be, and D-Wave's strong bookings growth and margin may help as well, but there remains a substantial distance between the company (based on its latest earnings report) and a quarter in which it breaks even or generates a profit. On top of that, D-Wave's valuation remains sky-high, with a price/sales (P/S) ratio of 286.5 and a book value of just $2.30 per share. Even with a recently announced new agreement with a Fortune 100 company, investors may question D-Wave's commercial viability based on those metrics.

At the same time, D-Wave's technology potential is impressive, particularly given its new dual-tech approach since completing its purchase of Quantum Circuits earlier in the year, which should also help it to design and build quantum systems more efficiently.

Wall Street Analysts Remain Bullish, But Retail Investors May Not Have the Patience

QBTS stock is still favored across Wall Street, with 14 of 16 ratings being a Buy or equivalent and a consensus price target about 92% above current levels.

Retail investors may not be so willing to continue to make a speculative bet on a company that could still be a long way off from bringing its financials in line with its technological potential, however.

On the other hand, those who have a tolerance for the volatility likely to come with D-Wave shares while it focuses on increasing revenue, reducing expenses, and further distinguishing its quantum technology from competitors may find they were early adopters of a major quantum industry leader.

This is by no means guaranteed, however, and the timeline may be difficult to assess.