IonQ, Inc.

Greetings and welcome to the IONQ First Quarter 2023 Earnings Call. At this time, all participants are in listen-only mode. A question and answer session will follow the formal presentation. If anyone needs 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 at P&A and Head of Investor Relations. Please go ahead.

Good afternoon, everyone, and welcome to INQ's first quarter 2023 earnings call. My name is Jordan Shapiro, and I'm the Vice President of Financial Planning and Analysis and Head of Investor Relations here at INQ. I'm 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 first quarter 2023 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. You are directed to our press release for reconciliation of adjusted EBITDA to its closest comparable GAAP measure. During the call, we will discuss our business outlook and make forward-looking statements. These comments are based on our predictions and expectations as of today. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in our most recent filings with the SEC. Now, I will turn it over to Peter Chapman, President and CEO of IonQ. Peter?

Thanks, Jordan. Good afternoon, everyone, and thank you for joining us for our first quarter 2023 earnings call. We finished the first quarter with $4.3 million in revenue, which was above the high end of our expected range. Meanwhile, we booked $4.1 million in new contracts on our maintaining this year's annual booking guidance. Thomas will share more details on our commercial activity and financials later in the call. We continue to move forward at full speed at INQ, trailblazing in our industry. In our view, we have distanced ourselves from the pack of pure play quantum computing companies by having the best cash position by a wide margin. We also believe we are sufficiently funded to get the company to profitability based on our current roadmap. INQ will continue to focus on achieving quantum advantage and developing commercial applications for our customers. At INQ, our primary focus has been not on the quantity of qubits in a system, but on the quality of the qubits and their operations. For quantum computers, this quality, also known as fidelity, is the key differentiator in successfully completing computational tasks. We measure the fidelity of our systems using an application-oriented benchmark we call algorithmic qubits, or AQ. AQ is based on work pioneered by the Quantum Economic Development Consortium, an independent industry group, and evaluates quantum computers utility in real-world settings. Last year, we achieved our goal of hitting 25 AQ. This year, we set an even more ambitious goal of hitting 29 AQ by the end of the year. Recall that every additional AQ corresponds to roughly doubling useful computational space, meaning we can run much more powerful quantum algorithms. Today, I am excited to share that we have hit our 29 AQ target, meeting our 2023 technical goal seven months early. This achievement, made possible by the hard work and dedication of the full INQ team, brings dramatically more powerful quantum computing capability to our customers. and puts us one step closer to reaching quantum advantage. What's more, I am excited to announce that we hit this target using INQ Forte, our newest world-class quantum system. You may remember that we first announced work on our Forte system midway through last year with the goal of running customer jobs on Forte before the end of 2022. We achieved that goal Our next major technical milestone is achieving 35AQ, which is particularly significant. At 35AQ, simulating the operations of quantum algorithms using classical hardware can become exceedingly challenging and costly. We expect at 35AQ, some customers will have an increasingly clear business case for running models on actual quantum computers, rather than attempting to simulate those models with classical computers. If we're watching the quantum industry for signs of our computers becoming more practical or more powerful than classical computers, hitting 35 AQ is an important milestone to track. The next steps will be for our systems to take on problems that are beyond the capacity of even the best quantum simulators and subsequently to tackle problems that even the best supercomputers can't solve. We anticipate each of these milestones driving further commercial adoption. Since going public about 20 months ago, we have been dramatically increasing our AQ, going from six AQ commercially available on our INQ Harmony systems to now 29 AQ on INQ Forte. That represents an increase of more than one AQ per month on average. Similarly, If you look ahead to our goal of hitting 64 AQ by the end of 2025, that also represents an average increase of more than one AQ per month. Moore's Law famously predicted the number of transistors in an integrated circuit would double roughly every two years. As a reminder, each additional AQ roughly doubles the power of our systems. as measured by the useful computational space for running quantum algorithms. Moore's Law was about doubling every two years. At INQ, we've been doubling our system's power every month on average. For example, the most recent leap from 25 AQ to 29 AQ represents a 16-fold increase in computational power. Potential customers are noticing the superior performance of INQ systems. And with demand for INQ compute time rapidly rising, we have been accelerating our system manufacturing efforts. Today, I am proud to announce that we have completed construction of our second ARIA class quantum computer, also known as ARIA 2. This new machine will join ARIA 1 on the public cloud this quarter. Bringing ARIA 2 online is a crucial step for our commercial efforts as it improves our redundancy, capacity, and order processing speed. Speaking of customers, we are proud to announce that as part of our commercialization efforts earlier this year, we signed a contract with the United Emirates Quantum Research Center Technology Innovation Institute to explore how quantum computing can give the UAE a competitive edge. This agreement is a testament to the trust and confidence that global leaders have in INQ's cutting-edge technology and our ability to drive breakthroughs in quantum computing. In addition to bringing on more customers, we're also seeing strong results from existing customers taking advantage of our increasingly powerful systems. In collaboration with Fidelity Center for Applied Technology, or FCAT, We are proud to announce new work in the field of quantum Monte Carlo. Our newest accomplishment focuses on speeding up Monte Carlo simulations, a widely used statistical analysis method in finance, science, and engineering. A year ago, we started investing in quantum artificial intelligence, or quantum AI. Our first output of that work is a paper on modeling human cognition. which has now been published in the peer-reviewed scientific journal Entropy. We are excited by the potential for quantum to power not just machine learning, but also artificial general intelligence, or AGI, the point at which AI is strong enough to accomplish any task that a human can. With application areas for quantum becoming increasingly clear, we are also forging channel partnerships that will help us distribute INQ compute access to a broad set of customers around the globe. We added a new enterprise partnership in April when INQ joined forces with BearingPoint, a global management and technology consulting firm, to power their growing quantum team in Europe. BearingPoint has offices in 24 countries around the world and has over 5,000 employees, with their quantum team soon to be trained on our systems. BearingPoint Premier clients will be offered access to INQ's world-class quantum computing systems and application development services. Our momentum here at INQ continues to build. We hit our key technical target for the full year, well ahead of schedule, beat our revenue goal for the quarter, innovated with our customers to solve new problems, and tapped into a new channel partnership in Europe. Lastly, it is my pleasure to introduce Pat Tang, the newest member of the INQ leadership team. Pat will be taking over as Vice President of Research and Development. He brings to INQ over 23 years of technology experience, most recently as a VP of Engineering at Amazon's Lab 126. Pat is one more testament to the best-in-class talent that is convening at INQ. And with that, I would like to turn the call over to Thomas for a more detailed review of the financials. Thomas?