Quantum Computing Inc. Reports First Quarter 2025 Financial Results

Rhea-AI Summary

Quantum Computing Inc (QUBT) reported Q1 2025 financial results, marking significant progress in both operations and financials. The company posted revenues of $39,000 (33% gross margin) vs $27,000 in Q1 2024. Notable achievements include completing construction of their Quantum Photonic Chip Foundry in Tempe, Arizona, receiving five initial foundry orders, and securing new partnerships. QUBT reported net income of $17.0 million ($0.13 per share), primarily due to a $23.6M non-cash gain from warrant liability valuation. The company strengthened its balance sheet with cash increasing to $166.4M through a $93.6M private placement. Post-quarter, QUBT secured a $406,000 NASA subcontract and additional quantum machine orders from Delft University and a major automotive manufacturer.

Positive

• Completed construction of Quantum Photonic Chip Foundry with 5 initial orders
• Secured $93.6M through private placement, strengthening cash position to $166.4M
• Net income of $17.0M compared to $6.4M loss in Q1 2024
• Revenue growth of 44% YoY from $27,000 to $39,000
• New strategic partnerships including NASA subcontract worth $406,000
• Post-quarter sales of quantum machines to Delft University and major automotive manufacturer

Negative

• Gross margin declined from 41% to 33% YoY
• Operating expenses increased 32% YoY to $8.3M from $6.3M
• Operating loss widened to $8.3M from $6.3M YoY
• Net income primarily driven by non-cash gain, not operational improvements

Insights

Financial Analyst

QCi reports mixed Q1 with minimal revenue but strengthened balance sheet, completed chip foundry construction, and pivotal quantum computing partnerships.

QCi's Q1 2025 results present an interesting picture of a quantum technology company in early commercialization. Revenue reached just $39,000 with 33% gross margins, a modest 44% improvement from Q1 2024 but still negligible in absolute terms. The slight gross margin decline from 41% last year isn't concerning given the low revenue base where minor fluctuations are expected.

What's truly notable is the company's balance sheet transformation. Cash reserves increased dramatically to $166.4 million from $78.9 million at year-end 2024, primarily through a $93.6 million private placement offering. This substantial capital infusion provides QCi with a multi-year runway to pursue commercialization without immediate funding concerns.

The reported net income of $17 million ($0.13 per share) requires context - it stems primarily from a $23.6 million non-cash gain from warrant liability valuation, not operational profitability. Excluding this accounting adjustment, the company's operating loss was $8.3 million, widening from $6.3 million in Q1 2024 due to higher employee expenses as the company scales operations.

The completion of their Quantum Photonic Chip Foundry represents a critical infrastructure milestone, potentially enabling revenue acceleration through TFLN (thin film lithium niobate) photonic chip production. The announcement of a fifth purchase order suggests early commercial validation, though meaningful revenue from this facility remains to be demonstrated in future quarters.

Strategic partnerships with prominent research institutions (Sanders TDI collaboration) and government agencies (NASA subcontract) provide important validation for QCi's quantum computing approach. While these relationships don't translate to material revenue yet, they demonstrate the company's ability to engage sophisticated potential customers and position QCi in the rapidly evolving quantum computing ecosystem.

Quantum Technology Specialist

QCi advances commercialization with completed TFLN chip foundry and quantum system adoptions, though significant revenue remains distant.

QCi's Q1 developments showcase important technical progress in both quantum hardware and photonics. The completed Quantum Photonic Chip Foundry for TFLN (thin film lithium niobate) manufacturing represents a significant achievement in the quantum photonics supply chain. TFLN is rapidly emerging as a critical material platform for next-generation photonic integrated circuits due to its exceptional electro-optic properties and compatibility with existing semiconductor manufacturing techniques.

The company's receipt of five initial orders for foundry services suggests market validation for their TFLN capabilities, likely for applications in datacom, telecom, and quantum information processing. Establishing their process design kit (PDK) is a crucial next step that will determine their ability to consistently deliver high-quality photonic chips at scale.

From a quantum computing perspective, the Sanders TDI collaboration focusing on computational chemistry and biomolecular modeling represents an appropriate application domain for QCi's Dirac-3 quantum optimization machine. These problems are among the most promising near-term applications for quantum advantage, as they can benefit from even modest quantum resources.

The subsequent NASA contract to develop quantum-based techniques for removing sunlight noise from LIDAR data demonstrates QCi's ability to identify specific problems where their current quantum capabilities might provide practical benefit. This application-focused approach stands in contrast to competitors pursuing general-purpose quantum computing with longer timelines to practical utility.

The sales of specialized quantum equipment - a Quantum Photonic Vibrometer to Delft University and an EmuCore reservoir computing device to an automotive manufacturer - further validate QCi's strategy of commercializing purpose-built quantum systems rather than waiting for fault-tolerant universal quantum computers. These specialized systems can deliver value in specific applications today, potentially generating revenue and customer relationships while the broader quantum computing field continues maturing.

HOBOKEN, N.J., May 15, 2025 /PRNewswire/ -- Quantum Computing Inc. ("QCi" or the "Company") (Nasdaq: QUBT), an innovative, integrated photonics and quantum optics technology company, today released financial results for the three-month period ended March 31, 2025.

Dr. Yuping Huang, Interim Chief Executive Officer of QCi, commented, "QCi delivered solid operational and financial progress in the first quarter, strengthening our balance sheet and advancing key strategic initiatives. We completed construction during the quarter of our Quantum Photonic Chip Foundry in Tempe, Arizona, a major milestone that positions us to meet growing demand for thin film lithium niobate (TFLN) photonic chips, underscored by the announcement of a fifth purchase during the period. We're encouraged by our early traction, which is the first step in what we believe is a significant, multi-year opportunity to serve the expanding markets in datacom, telecom, and quantum-enabled applications. In parallel, we continued to deepen engagement with both government and commercial partners, reinforcing the growing interest in our quantum and photonic machines and positioning QCi to capitalize on emerging opportunities ahead."

First Quarter 2025 Financial Highlights

• First quarter 2025 revenues totaled approximately $39,000 (33% gross margin) compared to $27,000 (41% gross margin) generated in the first quarter of 2024. Gross margin can vary at our current revenue levels. As such, the year-over-year decrease is not unexpected.
• First quarter 2025 operating expenses totaled $8.3 million compared to the previous year's first quarter operating expenses of $6.3 million. The year-over-year increase was primarily driven by higher employee-based expenses.
• The Company reported net income attributable to common stockholders of $17.0 million, or $0.13 per basic share for the first quarter of 2025, compared to a net loss attributable to common stockholders of $6.4 million or $(0.08) per basic share for the same period of the previous year. The increase in net income this quarter was primarily due to a $23.6 million non-cash gain on the mark-to-market valuation of the Company's warrant liability as a result of our merger with QPhoton in June 2022.
• Total assets at March 31, 2025 were $242.5 million, increasing from $153.6 million at December 31, 2024. Cash and cash equivalents at March 31, 2025 increased by $87.5 million to $166.4 million from year-end 2024. During the first quarter, the Company raised total net proceeds of $93.6 million through a private placement offering of common stock.
• Total liabilities at March 31, 2025 were $21.7 million, a decrease of $24.6 million compared to year-end 2024, driven primarily by the previously-mentioned non-cash changes in the fair value of the Company's warrant liability.
• As of March 31, 2025, the Company had shareholders' equity totaling $220.8 million.

First Quarter 2025 Operational Highlights

• Quantum Photonic Chip Foundry Update: During the quarter, QCi completed construction of its Quantum Photonic Chip Foundry in Tempe, Arizona, achieving a key milestone in scaling its U.S.-based TFLN manufacturing services. The Company is now establishing its process design kit (PDK) and filling customer orders. To date, the Company has received five initial orders for its foundry services.
• Advancing Quantum Machine Adoption: On January 15, 2025, QCi announced a collaboration with Sanders Tri-Institutional Therapeutics Discovery Institute (Sanders TDI), a non-profit drug discovery institute comprising Memorial Sloan Kettering Cancer Center, The Rockefeller University, and Weill Cornell Medicine. Through this partnership, Sanders TDI will leverage cloud-based access to QCi's Dirac-3 quantum optimization machine to support computational chemistry and biomolecular modeling research. This collaboration highlights growing adoption of QCi's quantum systems in real-world biomedical applications.
• Board Appointment Strengthens Strategic Leadership: On March 26, 2025, QCi appointed Eric Schwartz to its Board of Directors. Mr. Schwartz brings over 20 years of experience in corporate finance, mergers and acquisitions, and corporate strategy, with a strong track record guiding companies through commercialization and manufacturing scale-up. His expertise will support QCi's growth initiatives as the Company advances its TFLN chip foundry and drives market adoption of its quantum machines.
• Strengthening Sales & Market Presence: The Company continued to expand its commercial and government engagement, participating in numerous trade shows and conferences during the quarter to showcase its quantum optimization and photonic chip solutions to prospective customers and partners.
• Advancing Strategic Partnerships with NASA: Subsequent to the quarter on April 30, 2025, QCi was awarded a subcontract valued at approximately $406,000 through Analytical Mechanics Associates (AMA) to support NASA's Langley Research Center. Under the project, QCi will use its Dirac-3 quantum computer to develop a quantum-based technique for removing sunlight noise from space-based LIDAR data, an obstacle that has historically limited NASA's ability to conduct reliable daytime Earth observation. This project builds on QCi's prior work with NASA.
• Expanding Commercial Adoption of Quantum Solutions: Subsequent to the quarter, QCi secured two additional customer orders, reflecting growing global demand for its quantum machines. On April 1, 2025, the Company announced the sale of a Quantum Photonic Vibrometer to the Department of Aerospace Structures and Materials at Delft University of Technology in the Netherlands, supporting advanced research in non-destructive testing and structural health monitoring. Later in the month, on April 22, 2025, QCi announced the sale of an EmuCore reservoir computing device to a major automotive manufacturer for research and development use. These orders underscore QCi's strategy to broaden awareness and adoption of its quantum solutions across both academic and industrial markets globally.

Earnings Conference Call

The Company will host its first quarter conference call on Thursday, May 15, 2025, at 4:30 p.m. To access the live webcast of the conference call, visit the QCi Investor Relations page at https://quantumcomputinginc.com/investor-relations. Investors may also access the webcast via the following link: https://www.webcaster4.com/Webcast/Page/3051/52325

To participate in the call by phone, dial (888) 506-0062 approximately five minutes prior to the scheduled start time. International callers please dial (973) 528-0011. Callers should use access code: 832763.

A replay of the teleconference will be available until May 22, 2025, and may be accessed by dialing (877) 481-4010. International callers may dial (919) 882-2331. Callers should use conference ID: 52325.

About Quantum Computing Inc.

Quantum Computing Inc. (Nasdaq: QUBT) is an innovative, integrated photonics and quantum optics technology company that provides accessible and affordable quantum machines to the world today. QCi's products are designed to operate at room temperature and low power at an affordable cost. The Company's portfolio of core technologies and products offer unique capabilities in the areas of high-performance computing, artificial intelligence, and cybersecurity, as well as remote sensing applications.

Company Contact:
Rosalyn Christian/John Nesbett
IMS Investor Relations
investors@quantumcomputinginc.com

Forward-Looking Statements

This press release contains forward-looking statements as defined within Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements, generally identified by terms such as "may," "will," "expect," "believe," "anticipate," "estimate," "intends," "goal," "objective," "seek," "attempt," "aim to," or variations of these or similar words, involve risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. Those statements include statements regarding the intent, belief or current expectations of QCi and members of its management as well as the assumptions on which such statements are based. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, including the timing of orders and revenue, and the outcome of ongoing collaborations and demonstration projects with certain U.S. government agencies, academic institutions and commercial customers, and that actual results may differ materially from those contemplated by such forward-looking statements. Except as required by federal securities law, QCi undertakes no obligation to update or revise forward-looking statements to reflect changed conditions.

IMPORTANT NOTICE TO USERS (summary only, click here for full text of notice): All information is unaudited unless otherwise noted or accompanied by an audit opinion and is subject to the more comprehensive information contained in our SEC reports and filings. We do not endorse third-party information. All information speaks as of the last fiscal quarter or year for which we have filed a Form 10-K or 10-Q, or for historical information the date or period expressly indicated in or with such information. We undertake no duty to update the information. Forward-looking statements are subject to risks and uncertainties described in our Forms 10-Q and 10-K.

QUANTUM COMPUTING INC. Consolidated Balance Sheets (in thousands, except par value data)
		March 31,				December 31,
		2025				2024
Assets
Current assets:
Cash and cash equivalents		$	166,429			$	78,945
Accounts receivable, net			20				27
Inventory			131				18
Prepaid expenses and other current assets			660				161
Total current assets			167,240				79,151
Property and equipment, net			9,976				8,212
Operating lease right-of-use assets			1,419				1,522
Intangible assets, net			8,196				8,972
Goodwill			55,573				55,573
Other non-current assets			129				129
Total assets		$	242,533			$	153,559
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable		$	2,022			$	1,372
Accrued expenses			647				2,134
Deferred revenue			83				79
Other current liabilities			990				974
Total current liabilities			3,742				4,559
Derivative liability			16,902				40,532
Operating lease liabilities			1,062				1,181
Total liabilities			21,706				46,272
Stockholders' equity:
Common stock, $0.0001 par value, 250,000 thousand shares authorized;
137,322 thousand and 129,012 thousand shares issued and outstanding
as of March 31, 2025 and December 31, 2024, respectively			14				13
Additional paid-in capital			404,313				307,756
Accumulated deficit			(183,500)				(200,482)
Total stockholders' equity			220,827				107,287
Total liabilities and stockholders' equity		$	242,533			$	153,559

 

QUANTUM COMPUTING INC. Consolidated Statements of Operations (in thousands, except per share data)
		Three Months Ended
		March 31,
		2025				2024
Total revenue		$	39			$	27
Cost of revenue			26				16
Gross profit			13				11
Operating expenses
Research and development			2,985				2,220
Sales and marketing			672				451
General and administrative			4,642				3,659
Total operating expenses			8,299				6,330
Loss from operations			(8,286)				(6,319)
Non-operating income (expense)
Interest and other income			1,696				38
Interest expense, net			(58)				(155)
Change in fair value of warrant liabilities			23,630				-
Income (loss) before income tax provision			16,982				(6,436)
Income tax provision			-				-
Net income (loss)			16,982				(6,436)
Net income (loss) attributable to common stockholders		$	16,982			$	(6,436)
Earnings (loss) per share:
Basic		$	0.13			$	(0.08)
Diluted		$	0.11			$	(0.08)
Weighted average shares used in computing net earnings (loss) per common share:
Basic			135,217				81,934
Diluted			153,006				81,934

 

View original content to download multimedia:https://www.prnewswire.com/news-releases/quantum-computing-inc-reports-first-quarter-2025-financial-results-302457089.html

SOURCE Quantum Computing Inc.

FAQ

What were QUBT's Q1 2025 earnings per share and revenue?

QUBT reported earnings of $0.13 per share and revenue of $39,000 in Q1 2025, compared to a loss of $0.08 per share and revenue of $27,000 in Q1 2024.

How much cash does Quantum Computing Inc (QUBT) have as of Q1 2025?

QUBT reported cash and cash equivalents of $166.4 million as of March 31, 2025, an increase of $87.5 million from year-end 2024.

What major operational milestones did QUBT achieve in Q1 2025?

QUBT completed construction of its Quantum Photonic Chip Foundry in Tempe, Arizona, received five initial foundry orders, and established a collaboration with Sanders TDI for biomedical applications.

What new contracts did QUBT secure after Q1 2025?

After Q1, QUBT secured a $406,000 NASA subcontract, sold a Quantum Photonic Vibrometer to Delft University, and an EmuCore computing device to a major automotive manufacturer.

How did QUBT raise additional capital in Q1 2025?

QUBT raised $93.6 million in net proceeds through a private placement offering of common stock during Q1 2025.