Quantum Computing (QUBT) Q3 2024 earnings summary

Executive summary

• Revenue for Q3 2024 increased 102% year-over-year to $101,000, driven by new contracts, especially with Johns Hopkins University, and progress on the Arizona TFLN foundry, which is nearing completion and supports expansion into new markets.

• Net loss for Q3 2024 was $5.7 million (6 cents/share), improved from $7.1 million (10 cents/share) in Q3 2023, with operating expenses down 18% due to cost containment and lower G&A and marketing costs.

• Strategic focus on leveraging nanophotonics and thin film lithium niobate (TFLN) for quantum computing, AI, and remote sensing, with early-mover advantage in sectors like energy, automotive, finance, and healthcare.

• Advanced to final commissioning of the U.S.-based TFLN chip foundry, on track for early 2025 production, with pre-sales and offtake agreements underway.

• Secured fifth NASA contract for quantum remote sensing technology and renewed CRADA with Los Alamos National Laboratory to advance quantum optimization.

Financial highlights

• Q3 2024 revenue was $101,000 (9% gross margin), up from $50,000 (52% gross margin) in Q3 2023, mainly due to increased contractual sales.

• Operating expenses decreased 18% to $5.4 million, reflecting disciplined cost management.

• Net loss attributable to common stockholders was $5.7 million ($0.06 per share), improved from $7.1 million ($0.10 per share) in Q3 2023.

• Cash and cash equivalents at quarter-end were $3.1 million, up $1 million from year-end 2023.

• Working capital improved to $1.5 million from a deficit of $2.2 million at year-end 2023.

Outlook and guidance

• Arizona TFLN foundry expected to complete construction by year-end 2024, commission in January, and open for business in Q1 2025, with early production expected to drive growth.

• Management anticipates more external funding and contract/grant revenues, focusing on remote sensing and quantum technology for government agencies.

• Substantial doubt exists about the company's ability to continue as a going concern without raising further capital.