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D-Wave said it tapped into Lincoln Park ELOC for $20 million

By Dan O'Shea posted 20 Feb 2023

D-Wave acknowledged late last week that since late October last year it has raised about $20 million under a previously announced Equity Line of Credit (ELOC) with Chicago-based Lincoln Park Capital. 

The announcement, which was placed at the end of a press release that contained other technology and market news, comes after The Globe and Mail recently reported that D-Wave is facing a cash shortage barely six months after it raised around $50 million through a SPAC merger and IPO. The funds raised through the public offering fell far short of the roughly $340 million in proceeds that D-Wave had expected via the deal and some additional private investment, and the company originally announced the ELOC agreement with Lincoln Park the same week that its stock started trading in August 2022.

The ELOC allows D-Wave to draw up the $150 million, but the money can’t be claimed all at once, and as The Globe and Mail reported the ELOC can’t be accessed if the company’s share price dips below $1. It’s stock, QBTS, closed at $0.94 per share last Friday after the announcement was made

Regarding the $20 million draw since last October, the D-Wave press release stated,  “The ELOC has been an efficient source of capital during this period. Subject to the ELOC being available in accordance with its terms and under effective S-1 filings (including the 35 million shares to be registered under the recent S-1 filing), D-Wave may seek to access additional capital under the ELOC at whatever points in time the company determines appropriate as an ongoing mechanism to fund D-Wave’s operations.”

The press release also stated that D-Wave’s current cash balance “has improved over the cash balance previously reported as of September 30, 2022.” In its November 2022 third quarter earnings call, the company reported a cash balance of $13.8 million. It also said at that time it had more than 100 customers and had earned just under $5 million in revenue for the first nine months of 2022, with about $1.7 million of that coming in the third quarter.

D-Wave has not yet reported earnings for the fourth quarter of 2022. In its most recent public event, the company held its annual Qubits conference last month, during which several customers, including Mastercard, Davidson Technologies, and others, showcased their work with D-Wave’s quantum annealing and computing solutions.

Dan O’Shea has covered telecommunications and related topics including semiconductors, sensors, retail systems, digital payments and quantum computing/technology for over 25 years.

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