IQM Quantum Computers Oyj

Good morning. Welcome to IQM Quantum Computers' first earnings call as a public company, following our historic debut on the NASDAQ Global Select Market and NASDAQ Helsinki. Joining me today are Dr. Jan Gutz, our Chief Executive Officer, and Jan Kertner, our Chief Financial Officer. Before we begin, I'd like to remind everyone that today's discussion may include forward-looking statements, including comments on our product roadmap, customer demand, system deliveries, bookings, revenue timing, operating plans, and outlook. These statements are subject to risks and uncertainties that could cause actual results to differ materially from our current expectations. Please refer to today's earning materials, our public filings with applicable regulatory authorities, and our listing prospectus and subsequent stock exchange releases for more information on those risks. We will also discuss certain non-IFRS measures and reconciliations to the most comparable IFRS measures are provided in our earnings release. With that, I'll turn the call over to Jan Guts.

Thank you, Chiara, and thank you to everyone who is joining us for our first earnings call as a public company. Our first earnings call and the underlying transaction of going public has been important milestones for IQM. We officially entered the public markets on July 2nd under the ticker ITMX. We listed at Global Select Market on NASDAQ New York, followed by a listing on NASDAQ Helsinki. From the announcement in February to trading in July, our GoPublic transaction was completed in just five months. The successful closing of the transaction reflects the execution capability and the organizational strength we have built over the years. Part of building organizational strength We have also significantly strengthened our board of directors. We welcomed three new independent board members. First, Barbara Vennemann, former global head of IT at Deloitte and a board member at Vanguard. Second, Juho Sarvikas, CEO of Nasdaq-listed Intego and former president of Qualcomm North America. Third, Jeff Tudor, an experienced investor and board professional. They join our chairman, Sirk Pötting, COO of Nasdaq listed by Yontech, Alex Doll, co-founder of PGP Corporation and managing partner at 10.11 VC, Anu Mathola, President and CEO of Detection Technology, an experienced board professional, and myself. Our dual listing in particular marks a historic milestone, showcasing how technology from Europe can capture global investments, to turn quantum computing from a research ambition into real product and customer-ready computing infrastructure. At IQM, we have a differentiated business model. We are leading the deployment of quantum computers into data centers. And we have a unique technology approach based on vertically integrated full-stack quantum computers with advanced error correction. From day one, our founding thesis was to bring working full-stack quantum computers directly into the hands of HPC data centers. connecting quantum computers to AI supercomputers. We have deployed more quantum computers than any other company, with a focus on modular, open architectures. Our quantum computers are optimized across the full stack to create a faster lane toward fault-tolerant quantum computing. Our performance across the first half of 2026 shows that we are on the right track with this thesis. Our future success can be measured in three distinct KPIs. First, commercial traction. This KPI becomes visible through our order backlog that converts into revenue over time. Second, product development. We have consistently hit our technology milestones and developed competitive products for a global market. We have a very detailed technology roadmap scaling to millions of qubits. And third, financial strength. We are well capitalized by a global investor base leading to a multi-year runway. These three KPIs are enabled by our distinct business model. We operate our own quantum computer factory and quantum data center, enabling us to manufacture, deploy, and support quantum computers for customers around the world. Our quantum computers are designed for commercial adoption and can be easily integrated into existing data centers. We call this approach production quantum, quantum computing that institutions own, operate, and grow with it. Before diving into our financial performance and operational updates, I want to address our view on the broader quantum industry. Investors are navigating a complex technology with competing modalities, research milestones, and commercial statements. I also want to speak directly to the risk disclosure noted in our listing prospectus about the timeline of large-scale commercial quantum traction. As a quantum computing pioneer, IQM operates in a highly regulated and naturally cautious environment. Yet our growing commercial traction demonstrates that quantum computing is already delivering real-world value when being integrated into supercomputing data centers. IQM is the commercial leader in full-stack quantum computing, based on a differentiated and vertically integrated approach. We have sold more on-premise quantum computers than anyone else, and we distribute quantum computing via the cloud. We have our own chip design tool, our own chip factory, our own assembly line, and our own quantum data center. Running our quantum computers works with a vertically integrated open and modular software stack for real use cases. So let's take a first look at these use cases we are exploring at IQM. Looking ahead, we see commercial adoption solidifying across three key application archetypes, where our superconducting clock speed forms a distinctive competitive mode. First, quantum simulation. Driven by heavy infrastructure investments from advanced material science and pharmaceuticals. For example, we have reported an 85% accuracy boost and an 88% reduction in execution time when validating quantified chemistry algorithms on IQM Garnet hardware. Second, optimization. Focused on real-world enterprise optimization across finance, manufacturing, logistics, and transportation. Most recently, IQM and Deutsche Bahn demonstrated a hybrid quantum classical railway scheduling solution using real operational data on today's IQM hardware. And third, quantum machine learning, an explosive cross-industry layer accelerated directly by the growth of artificial intelligence. Speaking of commercial acceleration across these exact verticals, on the 6th of July, we acquired selected assets of Quantistry GmbH, and I want to explain why. Quantistry is a pioneer in cloud-native AI-powered chemical and material simulation. Through this strategic acquisition, we acquired a proprietary software platform, valuable application IP, and a world-class quantum chemistry and machine learning team. This expands our application capabilities and accelerates the delivery of practical quantum solutions for our customers. Now, let's have a look at the products we are offering at IQM to implement these use cases. We deliver value to our customers through a unique and diversified product portfolio. Our commercial success is based on a three-tier system lineup plus a cloud offering. First, IQM Spark, our flexible on-premises entry point for universities and research laboratories, focused on education, training, and early-stage research. Paired with IQM Academy, it helps address the quantum talent gap while expanding the IQM ecosystem. Strategically, IQM Spark allows us to build early platform familiarity. As students, researchers, and developers trained on IQM systems move into industry, we believe Spark can support broader long-term adoption of our technology. IQM Spark also serves as a springboard for inventing new supporting technologies that will be directly compatible with IQM's quantum computers. Second product is IQM Radiant, or Scalable Noisy Intermediate Scale Quantum, or NISQ platform. It has been our core on-premises system for HPC centers, national labs, and enterprise customers. IQM Radiance is designed for direct HPC integration, delivered as an open platform, and upgradable with the latest IQM processors. With configurations from 5, 20, and 54 qubits today to 150 qubits, IQM Radiance gives customers a clear path to scale quantum capability within their own computing infrastructure. The third product line is ITM Halocene, our next generation on-premises platform for quantum error correction. Designed to bridge the transition from today's NISQ systems toward false tolerance quantum computing. It gives customers a platform to learn, research, create IP, and build applications on the critical path to error correction. This includes compilers, code implementations, AI-enabled error decoders, HPC integration software, calibration tools, and quantum algorithms. These research areas are critical for future fault-tolerant quantum computers and are areas where our customers get to innovate and spin out companies based on their research results. IQM Halocene is also built to explore architectures and software techniques that reduce the physical qubit overhead required for error correction. For IQM, this makes Halocene a strategic platform to deepen customer engagement around the technologies that will define the path to fault tolerance. Both Radiance and Halocene work with our HPC integration service, enabling to operate as slum nodes alongside classical CPUs and GPUs, already operationalized at supercomputing centers. Fourth, IQM Resonance. This cloud offering extends access to our systems through the cloud. Customers can access IQM Resonance either through our own cloud platform or via AWS. IQM Resonance positions us for the next phase of cloud adoption. It gives researchers, students, educators, and developers broader access to IQM's quantum computers and IQM Academy. At the same time, it supports advanced capabilities such as pulse level access and quantum error correction capabilities. What all our products have in common is the open and transparent stack. While many in the market offer black box systems, IQM is built around openness, modularity, and deep integration. That's particularly important for highly regulated industries such as financial services, healthcare, government, and critical infrastructure, where security, compliance, and data sovereignty often require on-premises deployment and tight integration with existing computing infrastructure. This open integration philosophy is one of the reasons IQM has become the repeated partner of choice for many of the world's leading supercomputing centers, enterprise customers, and research institutions. Okay, let's talk a bit about the commercial traction we are creating with this product portfolio. Our differentiated product strategy and roadmap results in a strong commercial success, one of our core strengths. Our commercial scale is increasing continuously. As of the close of the second quarter of 2026, IQM has cumulatively since inception sold 26 full-stack quantum computers worldwide. It builds more than 50 quantum computers. and successfully delivered 17 systems globally, with eight systems being currently in production. These are leading concrete operational metrics that set us apart from pure concept business in the quantum landscape. Perhaps most importantly, our customers include some of the world's most advanced computing centers. Four of the top 10 supercomputing centers in the world utilize IQM full-stack quantum computers, such as the Lumi AI Factory and TSC, a deal we recently closed. With a licensed supercomputing center in Germany and VTT in Finland, we have repeat institutional customers, highlighting the performance and reliability of our systems. During the first half of 2026, we expanded into several new markets, including Japan and Spain, through new customer wins and customer engagements. We also delivered new systems, now fully operational, at the U.S. Department of Energy's Oak Ridge National Laboratory in Tennessee, and another customer delivery to Genica Supercomputing Center in Italy. We also completed installations of our educational quantum computer IQM Spark and IQM Radiance R2 systems at universities in Finland, Germany, and Poland. We also seen growing demand from the private sector, with two recent system sales to enterprise customers. First, we reached a commercial sale where Galaxy, a space company in Poland, purchased a 54 qubit Radiance R3 system for on-premises installation. Second, we signed an agreement to deliver an IQM Radiance R2 systems to Toyo Corporation in Japan, securing our third Asian market footprint. As you can see, we have a global customer base ranging from the US to Europe and all the way to Asia. Our commercial reality is clear. Cloud adoption is growing, but gradually. On-premises installations remain our primary revenue engine today. while cloud and software capabilities expand the reach, usability, and long-term value of our systems. In order to deliver on this commercial success, we have developed the concept of production quantum. This means we invested in industrial strength for manufacturing since day one. It shows superconducting technology because it can be manufactured and scales to millions of qubits, while operating at a much higher clock speed than other modalities. This speed advantage at high processor quality offers a clear commercial advantage for our customers. Superconducting technology also makes IQM's quantum computers the right platform for data centers. Our quantum computers delivers what data centers actually need, speed, scalability, and stability. And it's already proving it. We have been running quantum computers in customer data centers and cloud systems uninterrupted for several months. Not in a lab, not a demo. Real systems, real customers, real workloads. This is where our vertically integrated model really matters. The tight innovation cycle between chip design, chip manufacturing, and system testing allows us to move faster, maintain the highest quality standards, reduce supply chain dependencies, and improve hardware margins. It truly creates a flywheel resulting in the best products for our customers. Those fast innovation cycles translate into tangible results when it comes to IP creation. According to an EPO and OECD ecosystem study, IQM ranks first among European quantum computing companies in patent assets. At the heart of IQM's business model is our proprietary FAB in Espoo, Finland, the first of a kind facility in Europe that delivers constant supply of working quantum processors with world-class performance. We've built it to accelerate our own technology development and manufacture our own quantum computers, not to operate as a commercial foundry. After our initial ramp-up of the factory in 2021, we have invested another 40 million euros into industrial expansion of our factory. This has doubled our cleanroom capacity to enable the production of up to 30 full-step quantum computers per year. At the same time, our ecosystem partnerships with NVIDIA, with AWS through retailer agreement, and with HPE ensure that our quantum computers can integrate directly into existing AI, cloud, and HPC workflows. For example, at HPE Discover, we announced a collaboration with HPE to integrate ITM's superconducting quantum computers with HPE Cray HPC infrastructure for hybrid enterprise environments. Let's talk a bit about the interplay between quantum and AI. Whether they're deployed on-premises or accessed through the cloud, Our quantum computers are designed to integrate seamlessly into customers' existing computing environments. We do not view quantum computers as standalone machines. We view them as part of a hybrid compute architecture alongside CPUs and high-performance GPUs for AI. This hybrid reality is where IQM holds an exceptional structural advantage and where we have had strong customer results. For example, most recently, the use case of molecular simulation with Leibniz Supercomputing Center in June. The hybrid approach also deepens our position at the intersection of quantum computing and AI. Let me be precise about what that means. Quantum computers are not designed to replace GPUs or process massive data volumes. They are designed to solve highly complex computational problems that can fit inside AI and high-performance computing workflows. A good example is the transaction we announced in early July, where IQM was selected to integrate a quantum computer into the Lumi AI factory, connected to one of the world's leading supercomputers. As AI infrastructure becomes increasingly energy intensive, quantum computing offers a complimentary path, applying specialized processors to problems where brute force classical scaling may become inefficient. This is how we see quantum developing, not as a standalone machine, but as a specialized accelerator within the next generation of hybrid AI and HPC infrastructure. This is exactly the direction of our work with NVIDIA, bringing quantum processors into AI and HPC infrastructure, while also using AI to improve the performance and reliability of all quantum computers. On the infrastructure side, we are combining the IQM HelloScene system with NVIDIA's NVQ-Link platform to enable tighter QPU-GPU integration. On the operation side, we've worked with NVIDIA on AI-driven parallel qubit calibration using the NVIDIA iZing Open family of AI models, helping automate system tuning and improve system uptime. We also enable customers and partners to push the boundaries of quantum AI. For example, a team at University College London published results in Science Advances this June, showing how an IQM quantum computer improved the reliability of machine learning models. In this case, it was about predicting complex physical systems such as turbulent fluid flows, blood flow in the human body, and atmospheric dynamics. These are chaotic systems that have historically defeated conventional AI. We've also designed a multi-scale biomolecular design pipeline combining quantum circuits with GPU-accelerated classical supercomputing alongside NVIDIA, University College London, and Leibniz Supercomputing Center. As generative AI and large model workflows hit classical scaling boundaries, our customers are actively exploring quantum machine learning and synthetic data generation. By integrating our quantum computers directly with GPU-based clusters at Maya supercomputing nodes, we are helping pull forward real demand, creating a structural framework where quantum accelerates classical AI pipelines. The integration of quantum and AI will be driven by our long-term technology roadmap. So let's have a look at what's happening on the technology side for IQM. They are extremely focused on implementing hardware-efficient error correction codes in our large-scale quantum computers. Over the last couple of months, we first introduced tile codes and immediately further refined them with the barbell codes, a novel family of QLDPC error correction codes customized for the IQM constellation topology. Based on our published analysis, bubble codes show strong improvement in efficiency. Either up to 1,000 times lower logical error rates at the same physical qubit budget, or a comparable logical performance with up to eight times fewer physical qubits. Independent MIT-led research on hardware-aware QLDPC implementation has also highlighted ICAM's earlier tile code work, reinforcing the relevance of our code hardware co-design strategy. Abel codes built on this direction by further reducing hardware complexity and physical qubit overhead, supporting our broader approach of co-designing codes, hardware topology, and system architecture on the path to fault tolerance. Ultimately, the efficiency of the error correction codes depends on the performance of the processor technology itself. Our technology doesn't just produce theoretical codes or chip designs. Our technology produces excellent quantum processors. As reported in a peer-reviewed paper published in PRx Quantum, we demonstrated a quantum processor simultaneously exceeding 99.9% fidelity for single qubit gates, two qubit gates, and readouts. Alongside our error correction and processor developments, we are expanding the software layer for our quantum computers. For example, we launched IQM Puller, our unified pulse-level compilation engine, giving developers greater transparency and control while making IQM's products attractive to a broader customer base. IQM QAOA, IQM benchmarks, qubit selector, dynamical decoupling, and classical feed-forward tools are examples of our active expansion into software, providing tooling for applications and algorithms developers. To execute our competitive and ambitious roadmap, we have significantly strengthened our executive team over the last six months. We have appointed Dr. Craig Sisler as Chief Technology Officer and promoted Dr. Ines de Vega to Chief Scientist to drive vertically integrated product engineering. Earlier this year, we have appointed Dr. Søren Hein as Chief Operating Officer overseeing FAB production and delivery of our advanced quantum computers. Together, the team will execute our roadmap toward fault-tolerant quantum computing. Reaching that goal means scaling from today's systems to thousands and ultimately millions of logical working qubits. That's why we are investing heavily in miniaturization and cost-efficient technologies that will make quantum computers practical to build and operate at scale. In short, the first half of 2026 has been a transformative period of execution. We have proven that a global quantum computing champion from Europe can successfully tap elite global public markets. We are very excited about what is still to come. I will now hand the call over to Jan Kirschner to discuss our financial results and outlook.

Thank you, Jan. As this marks our inaugural financial address to the public markets, I want to ground our investors in the specific evaluation framework needed to accurately assess IQM's financial model. Our business operates in a high-value, project-driven market where annual revenue is derived from a limited number of large contracts. Revenue visibility is influenced by customer approval cycles, by acceptance processes, and project implementation schedules, resulting in inherent variability in the timing of order intake and revenue recognition. This can have a significant impact on quarterly revenue, often making quarterly results look much more volatile than the underlying business activity. For this reason, we guide our investment community to track a comprehensive set of commercial metrics. Order intake within a period, revenue recognized within a period, and order backlog balance at the end of a period. Let's review our reported figures for the first half of 2026. Let's start by looking at our order book and our order backlog. Our order backlog is still exceptionally strong. We opened 2026 with an order backlog of 67.3 million euro. In the first six months of 2026, we added a further 10.6 million euro to the backlog as order intake was recognizing 8.9 million euro of revenue. As a result, we ended the half year with an order backlog of 69.1 million euros. Since the end of Q2, the order backlog has grown by another 33 million euros, bringing the total order backlog to over 102 million euros. Let's then go over our reported revenues. Q2 and H1 revenues respectively were 6.7 million euros and 8.9 million euros. These revenues are generated from quantum computing only and primarily from sales of on-premise systems, including the associated service and maintenance. Revenue from hardware and services was 6.4 million euros for the second quarter and 8.3 million euros for the half year. Total revenue also includes revenue from cloud-based usage of IQM's quantum computers, as well as co-development projects, but again from quantum computing related only. Our gross margin stands at 46% for the second quarter. Our reported operating loss was €30.9 million for the second quarter and €60.5 million for the first half of 2026, reflecting the significant investments we are making in R&D. The product roadmap we have outlined earlier is world-leading and delivery against it is well on track. I would like to provide a central context regarding our expense base. Our reported operating losses include one-time expenditures necessary to achieve our public listings at NASDAQ New York and NASDAQ Helsinki. We invested in legal and regulatory compliance, as well as in the necessary dual listing requirements. Whereas many of these expenses will be recognized in Q3 with the closing of the transaction, €9.9 million is included in our H1 general and admin expenses. The listing has transformed our capital position. IQM's cash position was at €309.4 million immediately following the listing on July 2nd. This substantial capitalization reduces near-term dilution or liquidity risk, provides a runway to Q2 2028, and gives us a robust balance sheet to fund our strategic milestones. As we look forward to the rest of the year, we are confirming our full-year 2026 guidance. Our full year order intake target is 65 million Euro to 75 million Euro. Our full year 2026 revenue target is 42 million Euro to 47 million Euro. Given that our first half revenue is a smaller fraction of our full year guidance, I want to reinforce our core cadence principles to remove uncertainty around our forward estimates. Our 2026 revenue model is structurally second half and Q4 heavy. This concentration is an outcome of our project timelines. The largest part of our 2026 revenue recognition is scheduled for Q4, tied directly to the scheduled delivery and customer acceptance milestones of our first 150 qubit system. Also, investors should expect three structural reasonality factors. First, extended backlog conversion. As our systems scale up into higher qubit classes, The timeline spanning from the point of order intake to revenue recognition naturally extends to 1.5 to 2 years. This reflects physical site preparation, high vacuum testing, and tailored on-premise installations and calibration. Second, European seasonal slowdown. Commercial procurement and site access is typically moderate during the European summer months in Q3, leading to a natural clustering of final installations and revenue realizations in the fourth quarter. Third, nonlinear order inflow. Core institutional and sovereign funding cycles move in irregular blocks rather than in predictable linear quarterly increments. The surge in backlog growth is entirely normal, followed by periods of operational installation. From a capital allocation standpoint, our priorities are clear and unwavering. We are deploying our cash directly into assets that further increase our competitiveness and value proposition, accelerating our physical customer delivery schedules achieving the Halocene error correction milestones, expanding internal SAP capacity, and deepening our cloud software ecosystem. We are also scanning for opportunistic M&A that truly will enhance our solutions. We are completely focused on becoming an enduring profitable market leader in global quantum infrastructure for the long term. With that, I will hand the call back to Jan Götz for closing remarks.