D-Wave Quantum Inc.

Good morning, everyone, and welcome to D-Wave's fourth quarter and fiscal year 2024 earnings conference call. Today's call is being recorded. At this time, I would like to turn the call over to Kevin Hunt of Investor Relations. Please go ahead.

Thank you, and good morning. With me today are Dr. Alan Barrett, our Chief Executive Officer, and John Markovich, our Chief Financial Officer. Before we begin, I would like to remind everyone that this call may contain forward-looking statements and should be considered in conjunction with cautionary statements contained in our earnings release and the company's most recent periodic SEC report. During today's call, management will provide certain information that will constitute non-GAAP financial and operational measures under SEC rules, such as non-GAAP gross profit, non-GAAP operating expenses, adjusted EBITDA, and bookings. Reconciliations to GAAP financial measures and certain additional information are also included in today's earnings release, which is available in the investor relations section of our company website at www.dwavequantum.com. I'll now hand over the call to Alan.

Thanks, Kevin. Good morning, everyone, and thank you for joining us today. It's a remarkable time to be leading one of the world's preeminent quantum computing companies, and it is incredible how much has happened since we spoke to you last quarter. Big companies like Google, Nvidia, Amazon, and Microsoft all made quantum headlines recently, fueling debate among quantum industry skeptics, enthusiasts, and undecideds as to when quantum will be able to solve real problems. At D-Wave, we're seeing firsthand the value that quantum is providing today for hundreds of companies. I'm not talking about 15 or 30 years from now. I'm talking about today. We recently laid out a framework to help people formulate an informed position on quantum. We call it quantum realized, and it's very simple. First, does the quantum company have technology that can solve complex problems better or faster than classical computing alone? Second, are the quantum systems highly performant, reliable, and available? And third, does the quantum company have proven commercial customer successes, impulsive concepts, and in-production application deployment. These are the criteria that customers need to see to realize real value today. And we believe that there is only one company that can meet all those criteria right now, and that is D-Wave Quantum. It's a very exciting time for D-Wave. Our business momentum continues, and we have never been in a stronger position as a company. We're making tremendous progress with our technical development milestones and scientific achievements, most recently evidenced by yesterday's peer-reviewed publication in Science of our demonstration of quantum supremacy on a real-world problem. We're the only quantum company that can claim it has outperformed Classical on a useful problem of relevance to business and science today. You can also see the momentum in our business results, As we close the first sale of an advantage system to the ulex supercomputing Center which led to record quarterly bookings of 18.3 million in the fourth quarter of 2024. The momentum is also reflected on our balance sheet, where we now have over $300 million in cash on hand, which we believe is enough to get us to sustain profitability. As previously stated, we expect to be the first pure play quantum company to reach profitability and with less cash invested than any of our competitors. We truly are a market leader. We were the first to launch commercial quantum systems, the first to have quantum applications running in production for commercial customers, and now the first to achieve a demonstration of quantum supremacy on a real world problem. D-Wave is quantum realized. Let me now walk you through some key business highlights, starting with technical achievements. We are proud to be the first in the world to demonstrate quantum supremacy on a useful real world problem. This groundbreaking work was achieved using our 1200 qubit advantage to prototype annealing quantum computer. And it was published in a peer reviewed paper in science on March 12th. Unlike other attempts, This achievement is the world's first and only demonstration of quantum computational supremacy on a useful problem and with relevance to customer problems today in material science. DOA's quantum computer performed the complex simulation in minutes and with a level of accuracy that would take nearly 1 million years using one of the world's most powerful supercomputers. In addition, It would require more than the world's annual electricity consumption to solve this problem, using the supercomputer, which is built with graphics processing unit or GPU clusters. it's a truly remarkable achievement, we encourage you to check out the paper today on science.org. Development of our sixth generation annealing quantum computer advantage to is rapidly progressing. And we recently announced the calibration of a third 4,400 qubit Advantage II processor. Compared with the current Advantage system, the Advantage II processor delivers significant performance gains with doubled qubit coherence time, which drives faster time to solution, a 40% increase in energy scale for higher quality solutions, and increased qubit connectivity from 15-way to 20-way, enabling solutions to larger and more complex problems. Next, let me turn to our commercial momentum. In February, we announced the first sale of a D-Wave Advantage annealing quantum computing system to the ULIC Supercomputing Center in Germany. The system has already been installed at ULIC, and we expect it will be connected to the Jupiter supercomputer, Europe's first and only exascale high-performance computer. By owning the system, ULIC has full control over all aspects of the system, which will enable them to work on breakthroughs in AI and quantum optimization applications. I should also note that this is not an in-kind transaction or a research grant. It is the sale of a commercial grade quantum computer. You look prepaid for the system in the fourth quarter, and this is a highly profitable sale for D-Wave. We received substantial interest from other potential customers about purchasing an advantage system as they recognize the significant benefits of owning a system outright. It enables them to tightly integrate with existing classical and high-performance computing systems, leverage and tune system parameters, and take advantage of new system innovations, such as advanced analog digital features as they are developed. We see system sales as an important component in our go-to-market strategy moving forward. That said, it's important to note that we expect to focus on the quantum compute as a service model with the vast majority of our commercial customers who are most interested in running business applications. We continue to work with customers on developing a variety of quantum and hybrid quantum applications, including drug discovery with Japan Tobacco, insurance portfolio optimization with Leda, the technology and data factory of Unipol, a leading Italian insurance company, and optimization of police vehicle deployment with North Wales Police. In addition, we recently announced a commercial hybrid quantum application built with our partner STAC that simulates and optimizes movements of autonomous agriculture vehicles. We believe that this could have important benefits to farmers as they adopt autonomous agriculture machines in order to scale and increase the output of their fields with quantum computing providing the analysis speed and accuracy to help maximize production and minimize costs. We're also seeing increased interest from the broader industry in hearing about D-Wave and our technology's near-term value at major events and conferences. Just yesterday, I was at the annual South by Southwest conference, sharing the momentous news of our quantum supremacy result and discussing how organizations are realizing tangible benefits from our quantum computing systems. I talked about how our quantum computers are now providing faster, more accurate, and less expensive solutions than classical computers for evolutionary applications such as optimizing mobile networks, creating more efficient workforce schedules, and streamlining automotive manufacturing. Next week, I will be at NVIDIA's GTC Quantum Day, where I will have the opportunity to educate people on the benefits of annealing quantum computing, D-Way's differentiated market position, and how we're solving customers' computationally complex problems right now at scale, while others remain stuck in research and development. On the heels of GTC Quantum Day, I invite you all to join us on March 31st at D-Wave's annual Qubits user conference in Scottsdale, Arizona. We are really excited about the lineup of company executives, customers, and industry thought leaders that will address the ways that D-Wave products are delivering value to customers now. You will hear from speakers including Charles Payne of Fox Businesses Making Money with Charles Payne, IDC, Davidson Technologies, ULIC, Japan Tobacco, NTT DoCoMo, Quantum Research Sciences, SAS, Busan National University, and the University of Southern California, among others. We expect this event will be a powerful demonstration of quantum realized. Turning now to a couple of updates on our go-to-market growth strategy. We recently announced our Quantum Uplift program, offering incentives to organizations that have been disappointed with the results they've seen from competitors' quantum systems. We hear a lot of dissatisfaction when talking to potential customers about the lack of reliability and uptime they experience with competitor systems, and more importantly, those systems' inability to solve practical real-world problems. For those customers, we believe that DOAs can help them start to realize the benefits of quantum and hybrid quantum now. To accelerate adoption of our annealing quantum computing technology, we announced the LEAP Quantum LaunchPrad program, a three-month trial that provides access to DOA systems, our LEAP real-time quantum cloud service, and our team of quantum experts for project support. We believe that this program can expand the universe of organizations using quantum to solve their complex problems today. We also continue to build out our management and leadership bench. In November of 2024, We announced the appointment of Sharon Holt to our board of directors. Sharon had significant experience in the technology sector as an executive investor and board member. She has worked in semiconductors, embedded technologies, and intellectual property, and has quickly become a very valuable addition to our board. Finally, let me close with some quick comments on our financials. As I noted, The signing of the ULIC deal drove $18.3 million in bookings for Q4 of 2024, and that's a 502% increase over the fourth quarter of 2023. I also noted that we were paid for that deal during the fourth quarter, which brought in a substantial amount of cash. We also completed two separate ATM programs in the fourth quarter that brought in a total of $175 million in gross proceeds in 2024 which resulted in a record cash position of $178 million at year end. In January of this year, we raised an additional $150 million in gross proceeds from another ATM program, which led us to a current cash balance in excess of $300 million. I will reiterate that we believe that this is sufficient capital to get D-Wave to profitability, and we continue to believe we will reach that milestone faster than any other independent quantum company and with far less total investment. And last, in a few minutes, you will hear from John that we expect our fiscal year 2025 Q1 revenue to exceed $10 million. With that, I'll hand it over to John to provide a review of fourth quarter and fiscal year 2024 results. John?