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Should You Buy, Hold, Or Sell QUBT Stock Ahead of Q2 Earnings?
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Key Takeaways
{\"0\":\"QUBT Q2 revenues are expected to be $0.10M, down 44.4% Y/Y. Loss per share is expected to be 6 cents.\",\"1\":\"New orders and expansion into quantum cybersecurity may boost Q2 top-line results.\",\"2\":\"Rising costs and gross margin decline may weigh on QUBT\'s near-term financial performance.\"}
Quantum Computing Inc. (QUBT - Free Report) is expected to report second-quarter 2025 results shortly.
The Zacks Consensus Estimate for second-quarter revenues is currently pegged at 0.10 million, projecting a 44.4% decline year over year.
The consensus mark for the bottom line is currently pegged at a loss of 6 cents per share, unchanged over the past 30 days. In the year-ago quarter, too, QUBT incurred a loss of 6 cents per share.
Let’s see how things have shaped up prior to this announcement.
Factors to Focus on Ahead of QUBT's Q2 Earnings
Foundry Scale-Up: Quantum Computing completed construction of its Tempe-based thin-film lithium niobate (TFLN) photonic chip foundry in the first quarter, marking a key milestone in its transition to in-house fabrication. The company has since ramped up tool testing, finalized certifications, and initiated customer deliveries, initially fulfilling some orders via shared facilities. QUBT reported receiving five purchase orders, including a significant one from a top-five research institute in January, and continues to work with pre-order customers as it prepares for volume production. Management has guided for modest revenue contribution from the foundry in 2025. This should get reflected in the second-quarter results.
New Wins: Further, in the first quarter, QUBT expanded the adoption of its quantum solutions with key wins across research and industry. It partnered with the Sanders Tri-Institutional Therapeutics Discovery Institute to support biomolecular modeling via its cloud-based Dirac-3 quantum machine and secured a NASA subcontract to enhance space-based LiDAR data analysis. The company also sold a quantum photonic vibrometer to Delft University and an EmuCore reservoir computing system to a major automotive manufacturer. All these are likely to have started contributing to the company’s Q2 top line.
Innovation: In 2025, QUBT is emphasizing the broadening of its market reach through innovation and new customer wins. In Q1, it delivered its first commercial entangled photon source to a South Korean research institution and secured a $332,000 order from a top-five U.S. bank for a quantum communication system, marking its entry into the cybersecurity space. These moves, while positioning QUBT for growth in new verticals, are expected to have contributed to the company’s Q2 performance too. Positive sentiment is also building, with its recent inclusion in the Russell 2000 and 3000 indexes.
Stumbling Block: On the flip side, while the Tempe foundry is operational, customer adoption is still in early stages, and revenue contributions from the facility may have remained modest in Q2 because of a slow initial ramp. Moreover, gross margin declined to 33% in the first quarter from 41% a year earlier, reflecting cost pressures that may persist as the company scales production. Operating expenses rose significantly year over year due to higher employee costs. A similar trend is likely to have continued in the second quarter, too, amid significant macroeconomic pressure.
QUBT Shares Outperformed Industry, Sector and Peers
QBTS shares surged 147% during the second quarter (ending June 30, 3025) compared with the broader Zacks Computer and Technology sector’s rise of 20.4% and the Internet - Software industry’s increase of 25.1%. The S&P 500 Index gained 10.7% during the period. QUBT’s direct peers like IonQ (IONQ - Free Report) and D-Wave Quantum (QBTS - Free Report) rallied 97.3% and 85.3%, respectively, during this period.
QUBT Q2 Stock Performance
Image Source: Zacks Investment Research
Average Target Price for QUBT Suggests a Strong Upside
Based on short-term price targets, Quantum Computing is currently trading 24.7% below its average Zacks price target.
Image Source: Zacks Investment Research
What Should Investors Do With QUBT Stock Ahead of Q2 Earnings?
The market is encouraged about Quantum Computing’s strong stock performance, ongoing commercialization efforts and entry into new verticals like quantum cybersecurity and photonic hardware. However, with revenue growth still in the early stage, gross margin pressure lingering, and an expected increase in operating expenses in Q2, the near-term financial outlook remains mixed for this Zacks Rank #3 (Hold) stock. We recommend investors hold QUBT until we get further clarity on foundry output, order conversion and cost discipline on the upcoming earnings call.
Image: Bigstock
Should You Buy, Hold, Or Sell QUBT Stock Ahead of Q2 Earnings?
Key Takeaways
Quantum Computing Inc. (QUBT - Free Report) is expected to report second-quarter 2025 results shortly.
The Zacks Consensus Estimate for second-quarter revenues is currently pegged at 0.10 million, projecting a 44.4% decline year over year.
The consensus mark for the bottom line is currently pegged at a loss of 6 cents per share, unchanged over the past 30 days. In the year-ago quarter, too, QUBT incurred a loss of 6 cents per share.
Quantum Computing Inc. Price and EPS Surprise
Quantum Computing Inc. price-eps-surprise | Quantum Computing Inc. Quote
Image Source: Zacks Investment Research
Let’s see how things have shaped up prior to this announcement.
Factors to Focus on Ahead of QUBT's Q2 Earnings
Foundry Scale-Up: Quantum Computing completed construction of its Tempe-based thin-film lithium niobate (TFLN) photonic chip foundry in the first quarter, marking a key milestone in its transition to in-house fabrication. The company has since ramped up tool testing, finalized certifications, and initiated customer deliveries, initially fulfilling some orders via shared facilities. QUBT reported receiving five purchase orders, including a significant one from a top-five research institute in January, and continues to work with pre-order customers as it prepares for volume production. Management has guided for modest revenue contribution from the foundry in 2025. This should get reflected in the second-quarter results.
New Wins: Further, in the first quarter, QUBT expanded the adoption of its quantum solutions with key wins across research and industry. It partnered with the Sanders Tri-Institutional Therapeutics Discovery Institute to support biomolecular modeling via its cloud-based Dirac-3 quantum machine and secured a NASA subcontract to enhance space-based LiDAR data analysis. The company also sold a quantum photonic vibrometer to Delft University and an EmuCore reservoir computing system to a major automotive manufacturer. All these are likely to have started contributing to the company’s Q2 top line.
Innovation: In 2025, QUBT is emphasizing the broadening of its market reach through innovation and new customer wins. In Q1, it delivered its first commercial entangled photon source to a South Korean research institution and secured a $332,000 order from a top-five U.S. bank for a quantum communication system, marking its entry into the cybersecurity space. These moves, while positioning QUBT for growth in new verticals, are expected to have contributed to the company’s Q2 performance too. Positive sentiment is also building, with its recent inclusion in the Russell 2000 and 3000 indexes.
Stumbling Block: On the flip side, while the Tempe foundry is operational, customer adoption is still in early stages, and revenue contributions from the facility may have remained modest in Q2 because of a slow initial ramp. Moreover, gross margin declined to 33% in the first quarter from 41% a year earlier, reflecting cost pressures that may persist as the company scales production. Operating expenses rose significantly year over year due to higher employee costs. A similar trend is likely to have continued in the second quarter, too, amid significant macroeconomic pressure.
QUBT Shares Outperformed Industry, Sector and Peers
QBTS shares surged 147% during the second quarter (ending June 30, 3025) compared with the broader Zacks Computer and Technology sector’s rise of 20.4% and the Internet - Software industry’s increase of 25.1%. The S&P 500 Index gained 10.7% during the period. QUBT’s direct peers like IonQ (IONQ - Free Report) and D-Wave Quantum (QBTS - Free Report) rallied 97.3% and 85.3%, respectively, during this period.
QUBT Q2 Stock Performance
Image Source: Zacks Investment Research
Average Target Price for QUBT Suggests a Strong Upside
Based on short-term price targets, Quantum Computing is currently trading 24.7% below its average Zacks price target.
Image Source: Zacks Investment Research
What Should Investors Do With QUBT Stock Ahead of Q2 Earnings?
The market is encouraged about Quantum Computing’s strong stock performance, ongoing commercialization efforts and entry into new verticals like quantum cybersecurity and photonic hardware. However, with revenue growth still in the early stage, gross margin pressure lingering, and an expected increase in operating expenses in Q2, the near-term financial outlook remains mixed for this Zacks Rank #3 (Hold) stock. We recommend investors hold QUBT until we get further clarity on foundry output, order conversion and cost discipline on the upcoming earnings call.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.