IonQ, Inc.

Greetings and welcome to IONQ second quarter 2022 earnings call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Jordan Shapiro, Vice President of Financial Planning Analysis and Head of Investor Relations.

Please go ahead, sir. Good afternoon, everyone, and welcome to INQ's second quarter 2022 earnings call. My name is Jordan Shapiro, and I am the Vice President of Financial Planning and Analysis and Head of Investor Relations here at INQ. I am pleased to be joined on today's call by Peter Chapman, INQ's President and Chief Executive Officer, Thomas Kramer, our Chief Financial Officer, Dr. Chris Monroe, our Co-Founder and Chief Scientist, and Dr. Jung-Sang Kim, our Co-Founder and Chief Technology Officer. By now, everyone should have access to the company's second quarter 2022 earnings press release issued this afternoon, which is available on the investor relations section of our website at investors.inq.com. Please note that on today's call, management will refer to adjusted EBITDA, which is a non-GAAP financial measure. While the company believes this non-GAAP financial measure provides useful information for investors, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. This call discusses certain non-GAAP measures and you are directed to our press release for reconciliation of such measures to GAAP. Before we begin, please note that some of our remarks on this call will be forward-looking. Therefore, please refer to the cautionary statement in today's press release for additional details about these remarks. Please note that these forward-looking statements made during this conference call speak only as of today. Please refer to today's press release and to the company's quarterly report on Form 10-Q for the fiscal quarter ended June 30, 2022, which was filed with the SEC and other filings with the SEC for a detailed discussion of the risks that could cause actual results to differ materially from those expressed or implied in any forward-looking statements made today. Now, I will turn it over to Peter Chapman, President and CEO of IMQ. Peter?

Thank you, Jordan, and thank you, everyone, for joining us today. We had quite the quarter, and I'm excited to fill you in on the tremendous progress we've made here at INQ. With respect to our technical progress, we had previously reported six months ago that our ARIA class of quantum computers had achieved a record 20 algorithmic qubits. As you'll remember, algorithmic qubits is a benchmark consisting of common quantum algorithms that represent the kind of jobs customers want to run. The algorithms used in the benchmark were defined by the Quantum Industry Group, QEDC, with input from various hardware companies and users. Today, I am excited that we are bringing to the cloud a computer with more than 130,000 times the computational power of our previous cloud offering, specifically We have been hard at work to dramatically improve ARIA's performance, and I can share today that we have achieved a record-breaking 23 algorithmic qubits. Every time you add an algorithmic qubit, you double the computational power, which is the useful computational space for running algorithms. Moving from 20 to 23 is therefore an 8x increase in ARIA's computational power, all in just six months since February of this year. This further cements ARIA's lead as the most powerful known quantum computer in the world in terms of its ability to run useful quantum algorithms. This is significantly better than what we initially had expected for ARIA. In other words, we're well on our way towards meeting our 2022 technical goal of 25 algorithmic qubits. and are confident of hitting that target. Initial tests show that our next generation systems that we've discussed on prior earnings calls are already outperforming even the best ARIA data on several key metrics. With ARIA exceeding expectations, we believe the future is even brighter for our next generation. And as you may remember, we plan to offer Forte to initial customers later this year for those who are interested in using INQ's latest and greatest. Moreover, with the progress we are making on our barium systems, we expect even better performance and have a high degree of confidence in meeting our technical milestones in the coming years. Meanwhile, we are thrilled to announce that INQ ARIA which we believe to be the most powerful commercial quantum computer in the world with 23 algorithmic qubits, will be available tomorrow to all users of Microsoft Azure Quantum. Anyone with access to Microsoft's platform can process jobs on ARIA. It takes only a few minutes to set up an Azure account and to start programming on our INQ quantum system. This announcement furthers our commitment to making industry-leading hardware publicly accessible to current and future generations of quantum programmers. INQ systems are performing best in class, and customers have noticed. Existing customers are expanding their engagements with INQ, and we've recently added new customers, including Airbus and Dow. Airbus is leveraging INQ to use ARIA to explore optimization problems that are at the core of their aerospace business, such as how to efficiently load cargo on aircraft. The quantum algorithm we're developing with Airbus will account for a number of critical aviation variables that make this problem particularly difficult for classical algorithms to solve. Dow, a global leader in chemistry and material science, is using ARIA to explore the boundaries of quantum computing applications in materials discovery research. They join other INQ customers who are partnering with us to explore the intersection of quantum machine learning, material science, and chemistry. We continue to see compelling results on the projects we have initiated to apply our systems to real business problems, both internally and with customers. In June, we announced the results of our partnership with GE Research to develop a quantum algorithm that manages financial risk exposure. Our work used a large data set to generate the risk models across up to four variables. This technique is broadly applicable to industries which have risk management needs, such as finance, insurance, and supply chain management. Recently, we also signed a formal agreement to collaborate with the University of Maryland on a project for the National Science Foundation. For this, INQ will build and host a quantum router as part of a new quantum network, the Mid-Atlantic Region Quantum Internet, spanning UMD's campus and the surrounding area. The work is not only important for quantum communications, but also continues our work towards connecting multiple quantum computers together to form even more powerful systems. We are also pleased to provide an update on the multi-million dollar DARPA contract awarded to Zapata Computing, for which INQ is a participant. Over the last months, our subcontract was finalized and our work with DARPA and Zapata is underway. We're investing in cutting-edge research for problems that we think will benefit the most from quantum computing and deliver near-term business value. For example, we recently published a series of quantum methods for natural language processing, or NLP, a technology that is increasingly ubiquitous in voice interfaces like Amazon's Alexa, in email applications like Gmail, and in chatbot functionalities like those you may have experienced in customer support. Our team created NLP algorithms to represent linguistic qualities like ambiguity, vagueness, and novelty on a quantum computer. These elements are notoriously difficult to represent, and no previously published work has demonstrated ambiguity resolution or language generation working on a live quantum hardware. We think quantum techniques of this nature could eventually be embedded in these NLP applications, delivering a smoother and more powerful user experience. We are seeing a wealth of opportunities present themselves across enterprise, government, and academic customers. And each time we achieve remarkable results with our customers, they become advocates and case studies for the value of INQ quantum computing. This virtuous cycle is the cornerstone of the go-to-market flywheel that we're developing alongside our technology. Lastly, in July 2022, we welcome Kathy Cho to the INQ Board of Directors. Kathy brings with her deep technical experience from her role as SVP of SAS Engineering at Nutanix. go-to-market experience as a sales and operations executive at VMware, and a background in mechanical engineering and manufacturing from Stanford. Kathy joins Inder Singh, the CFO and Executive Vice President of Arm Limited, as our two newest independent board members. We're thrilled to welcome Kathy to our board. I will now turn the call over to Thomas for a more detailed review of the numbers and corporate initiatives. Thomas?