D-Wave Quantum recorded $7.2 million in revenue for the full year of 2022, but with the company’s available cash dwindling to $7.1 million at the end of the 2022 it has since accessed $15.7 million from a previously established line of credit, and during its earnings call last week announced another loan agreement that could infuse it with another $50 million.
The $15.7 million came from a Lincoln Park Capital Equity Line of Credit (ELOC) that D-Wave was no longer able to access after its stock price earlier this year fell below $1, the minimum required to be able to take advantage of the loan. The firm’s share price fell below $1 on Feb. 14, and has remained below that mark ever since, closing at $0.50 per share last Friday after D-Wave announced Q$ and full-year 2022 earnings.
The new $50 million four-year term loan agreement the company announced last week was with PSPIB Unitas Investments II Inc., an affiliate of PSP Investments. The initial advance under the term loan is $15 million with second and third advances of $15 million and $20 million respectively, subject to certain terms and conditions.
D-Wave is adding to its debt load just nine months after raising about $50 million in its IPO, although that figure was well short of the $340 million it had hoped to raise. Despite the mounting pressure, the company continues to increase revenue quarter to quarter, and both its customer list and the size of its bookings with customers continue to grow, giving D-Wave reason to continue envisioning a bright future for itself.
On a sequential quarter-to-quarter basis, fiscal 2022 fourth quarter revenue of $2.4 million increased by $700,000, or 41%, from the immediately preceding fiscal 2022 third quarter revenue of $1.7 million, The Q3 figure itself increased by $326,000, or 24%, from the immediately preceding fiscal 2022 second quarter revenue of $1.4 million.
D-Wave reported that for 2022 it increased average deal size for quantum-computing-as-a-service deals by 78% year-over-year basis, and that it entered 2023 with $5.8 million “in a combination of firm backlog and prior-year contracts expected to renew in 2023.” D-Wave CEO Alan Baratz said on the company’s earnings call Friday that this “is an indicator that we have customers that are moving forward towards larger-scale production deployments on our technology.”
D-Wave also had 67 revenue-generating commercial customers in 2022, a 18% year-over-year increase over 2021.
Baratz added that for 2023, the company expects its revenue to land in the range of $12 million to $13 million “representing year-over-year growth of 67% to 80%, a growth rate range that the company expects to maintain over the next several years.” He said that revenue guidance is supported by $4.6 million in contracted backlog from last year and $1.2 million in contracts entered into in prior periods that are expected to renew throughout 2023, representing potentially up to 48% of this year’s projected revenue.
Dan O’Shea has covered telecommunications and related topics including semiconductors, sensors, retail systems, digital payments and quantum computing/technology for over 25 years.