D-Wave Quantum Marks ‘Milestone’ With Further Push Into Europe

D-Wave Quantum said it had signed an agreement with a Swiss company to deploy one of its quantum computers in Europe. (COURTESY D-WAVE QUANTUM)

Key Points

• D-Wave Quantum secures a nearly $12 million agreement with Swiss Quantum Technology to deploy an Advantage2 quantum computer in Europe.
• D-Wave notes the placement of the system supports the Q-Alliance, a new initiative tied to the Italian government’s aspirations in quantum technology.
• D-Wave shares have surged 400% this year and almost 4,000% over the past 12 months.

D-Wave Quantum continued its push into Europe after signing an agreement for nearly $12 million with a Swiss company to deploy one of its quantum computers.

D-Wave said Swiss Quantum Technology SA had agreed to deploy a D-Wave Advantage2 annealing quantum computer in Europe. The agreement represents a commitment of €10 million ($11.6 million), with an option to purchase the system.

A source with knowledge of the matter told Barron’s the Swiss company was established to focus on quantum hybrid applications and research.

Customers will be able to access quantum computing power over the cloud using D-Wave’s Leap service. The company noted that the placement of the system also supports the Q-Alliance, a new initiative tied to the Italian government’s aspirations in quantum technology.

The announcement coincided with D-Wave CEO Alan Baratz’s appearance at a conference in Italy this week. Baratz described the Swiss Quantum Technology agreement as “an important milestone” in the company’s ongoing effort to expand access to its fleet of quantum systems.

In February, D-Wave delivered its previous-generation system, the D-Wave Advantage, to the Jülich Supercomputing Centre in Germany for hybrid computing with a classical supercomputer. Baratz told Barron’s that the system would be upgraded over time, describing it as a “multi-month exercise.”

D-Wave Quantum fell 2.5% after rising earlier in the session. Peers also were trading lower Wednesday. Rigetti Computing and IonQ fell 8.4% and 7.6%, respectively, while Quantum Computing declined 4.2%.

D-Wave declared earlier this year it was the first to demonstrate quantum supremacy on a “useful, real-world problem.” A peer-reviewed paper showed how one of its processors bested one of the world’s most powerful classical supercomputers, Hewlett Packard Enterprise’s Frontier, at a materials simulation problem.

Although the statement attracted skepticism at the time, Masoud Mohseni, distinguished technologist at Hewlett Packard Labs, told Barron’s that D-Wave’s claims largely were sound.

“There are some recent classical algorithms that could wash away the reported quantum advantage for a small subset of systems that were explored,” Mohseni explained over email. “However, the general beyond-classical claim made by D-Wave Quantum still holds.”

D-Wave stresses the commercial applications of quantum technology, and has a growing roster of clients including NTT Docomo, one of the largest wireless carriers in Japan.

Shares have soared 400% this year and almost 4,000% over the past 12 months due to unflagging investor enthusiasm. However, D-Wave’s earnings haven’t reflected this future potential.

Like its peers, D-Wave remains unprofitable. While revenue grew 42% year over year in its most recent quarter, the company’s loss swelled to $167.3 million from $17.8 million, largely due to charges related to the “significant price appreciation” of the company’s warrants.

CEO Baratz explained in an interview with Barron’s earlier this year that the company would likely continue to see “lumpiness,” or revenue that arrives in large chunks at irregular times, due to the infrequent nature of system sales.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com