Can Advantage2 Help Overcome D-Wave's Share Price Plateau?
Shares of D-Wave Quantum Inc. (NYSE: QBTS) rallied by an impressive 94% year-to-date, but a closer look reveals that the firm is in danger of losing momentum. When looking at the 12-month trailing return of an astronomical 1,800%, the company's performance over 2025 so far is not quite as noteworthy. Worse still, the rally has sharply declined since May—in the last several months, QBTS shares have moved more or less sideways.
Of course, there are some good reasons for this shift. Besides the natural trailing off of momentum after such a significant rally in the last year, D-Wave has faced increasing competition from some major players in the tech space, including NVIDIA Corp. (NASDAQ: NVDA), and its mixed earnings report from the latest quarter prompted a modest slump in stock price.
Fortunately for one of the most hyped companies in the fast-growing quantum computing space, D-Wave has a remarkably strong product in its Advantage2 quantum system.
Released in May, it has previously been too early to get a full picture of the impact of this offering on the broader industry.
As time goes on, though, investors may find that Advantage2 gives D-Wave just that—a key advantage in the race toward broad commercialization of quantum tech.
Advantage2 Against Competitor Products
Advantage2 is uniquely suited to complex optimization problems as an annealing quantum computer. This gives D-Wave a compelling and broad set of use cases for this product.
Although some short sellers and skeptics have criticized annealing tech for being limited in the problems it can solve compared to broader gate-model and trapped-ion approaches, D-Wave has demonstrated that there are, in fact, a range of sectors and industries poised to benefit from the optimization work that annealing does best.
The evidence is clear that annealing has broad appeal based on D-Wave's customers, including GE Vernova (NYSE: GEV), Nikon, Ford (NYSE: F), and dozens of others. Annealing's optimization efforts can apply to everything from logistics and supply chains to manufacturing, operations management, and much more.
The specs of Advantage2—more than 4,400 qubits, double coherence time, and a 40% increase in energy scale—make the system all the better able to tackle these various problems.
Revenue Generation History and Possibilities
The popularity of the Advantage2 system has helped to drive revenue growth for D-Wave. This was a bright spot in the firm's mixed earnings report for the second quarter, which saw more than 40% in year-over-year revenue growth even as D-Wave posted wider-than-expected losses per share.
Bookings nearly doubled in that period as well, largely thanks to Advantage2, which remains the company's primary commercially available quantum system that is not cloud-based.
One hurdle that D-Wave faces in its financials is the significant cost of the Advantage2 system. This remains a barrier to the product's widespread commercial popularity, which currently appeals primarily to large business customers, governments, and similarly sized organizations of various kinds.
The company will likely need to introduce additional products with a lower cost and more widespread appeal to continue growing revenue and work toward sustained profitability.
Fortunately, this seems to be exactly what D-Wave is aiming to do. A new set of developer tools has been announced in recent weeks, and additional developments in alternative quantum technology, like cryogenic packaging, could all point to these efforts.
The key will be to balance the core revenue-generating Advantage2 business with a diverse set of additional offerings to appeal to the widest possible customer pool.
What to Watch For
Investors looking for signs D-Wave can break out of its price plateau will likely want to see the company continue to build on its history of revenue growth when it reports for the third quarter in November, or when it provides an interim business update in the meantime.
Of course, as powerful as the Advantage2 system is, the quantum industry is developing rapidly, and it won't be long before this tool is outdated. Therefore, the firm must show it can create and launch products with more powerful specifications.
However, its advantages over some of its rivals give it time to accomplish this.
Quantum computing companies have tended to thrive on hype, investor optimism, and flashy achievements, all of which D-Wave has had. However, to build a business with sustainable appeal, the continued success of the core Advantage2 product will likely be vital.
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