Earnings call transcript Q2 2023

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Greetings. Welcome to IonQ's Second Quarter 2023 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note, this is conference is being recorded.

will FP&A, conference Head I Shapiro, to time, President, Vice of this turn over the Jordan At Investor Relations. now may you begin. Jordan,

Jordan Shapiro

Good Relations Jordan to call. afternoon, Planning and Vice welcome Officer; quarter Head Kim, Financial IonQ. everyone, earnings of and XXXX Investor President Officer; today's our IonQ's of President Chapman, My at and Shapiro second Co-Founder am is Analysis I'm I here the Thomas name our Technology by Kramer, call Officer. pleased Jungsang to be Peter and Chief Chief and Financial Chief our joined and Executive Dr. on and

our By earnings at that note today's have press access is a investors.ionq.com. should call, now, this on refer to measure. financial management issued is the of afternoon, which which everyone Investor company's adjusted website XXXX release non-GAAP the EBITDA, available Please second quarter on will to section Relations

non-GAAP investors, to this provides the company measure useful in believes the financial considered information in for be is this information a isolation GAAP. or presented information substitute While with as of for financial not presentation accordance the intended

GAAP You our are for comparable release reconciliation adjusted directed EBITDA closest its press of to a to measure.

mentioned outlook we a number expectations on of risks and call, our our differ uncertainties, are to recent due in Actual those could most the materially of SEC. forward-looking will the events comments discuss today. management's statements. These During as filings make and business based predictions or with including results and

President IonQ. will turn and Peter it CEO I over of Chapman, Now, to Peter?

Peter Chapman

well as finished with outstanding over range the further earnings high million of thank quarter of guidance joining our push ahead lead was $X.X call. another and above end $X.X been revenue, $X.X quarter we competitors. and second to for to XXXX everyone, afternoon, We which in million. quarter you continue Good here our million the at IonQ, our It's our

bookings systems first our the generations momentum time, but closing sector put, not just us three brings in million to efforts. stated puts This built and one, of year-to-date private upon bookings the first goal our by major striking commercial our to same we milestone future our to commercialization deal our Europe. range million previously of during the $XXX two years IonQ in in designed At achieve $XX cumulative of in

gives midpoint As guidance the of we'll million. quarter's for our confidence million, discuss, $XX.X to full from raise $XX this year the once success our to bookings again outlook the of up previous us

commercial at accelerating our Our IonQ wins. driving momentum is with our here technical groundbreaking progress

had AQ goal Forte a we quarter, algorithmic our seven already team technical XX qubits that schedule, over accomplished on for of shared our our system. IonQ achieving Last XXXX ahead or months record-breaking by

on We focused we XX month AQ reaching XX have now approximately going and With since AQ added are per average XXXX. achieved, one AQ September XX. in public AQ on

technical expected Building access commercial first to to research to government industry, European up our XX, XX. quantum technology serve In bring now AQ that to the Europe. a to future we date. will system expected and one plan reach with the systems IonQ's with these second roadmap, We reach institutes entities, use AQ systems. powerful local to and to Switzerland-based to QuantumBasel, on partnering of be follow our These that two success, June, group systems to deal have industry closed with systems we IonQ's announced largest will we

customers region in our planned as hardware will on-premise the beauty we in this other system, European datacenter. prospective to allowing is Europe, on some capacity partnership our The from us serve first project of new that retain each

Our few QuantumBasel is partnership a to significant ways. IonQ in

IonQ's a near-term boost sale. is a sale in large in significant create we prior such noted that First, This earnings bookings. calls could a

third-party validation deal partnership strong technical roadmap. and is first our IonQ's a involving IonQ Additionally, systems represents future ambitious this of

will a computers for quantum this fraction IonQ of of XX, a AQ XX quantum quintillion. a system a of two running power to be XX In computational at explore second, to to algorithms. able space of forward, space will the useful Looking able computational explore be

As operations supercomputer a it. is in Laboratory that XX a quintillion To with a floating calculate Ridge zeros after Oak perspective, the at one put X.X can quintillion reminder, second. National Frontier for point

the AQ customers simulate we supercomputers result, will best longer system, to to solve. We be currently can't that classical XX, end expect fully systems tackle XXXX. deliver At as IonQ AQ computers certain to will of enable by these a able no believe an problems and even XX the classical

XX. we one and path can We believe in our AQ to technical this are pursuing goal to quantum milestone, significant, committed our challenges road to is than at reach at the enhances arrive this confidence which this achieving historic Though more so. doing are advantage team the on

company milestones these seeing commercial in the we believe technical today a executing tangible deliver is driving roadmap IonQ around period. adoption We can roadmap While in our are sell the public IonQ is corner, just time that are these results that systems and belief against this today. only for

systems over months demand in configurations based various and sell next hope a on customer the seeing to we number XX for IonQ now are needs. We increased of systems

accounts the details this the of in these will guidance Our Thomas on guidance sales. probability for call. more our our provide later of weighted pipeline a XXXX is and already potential average for year it portion

Quantum share upcoming XX, World September more we roadmap details. will product a detailed technical Congress on and At

the encourage our systems interested upcoming learning will roadmap live presentation link accessing or anyone this more broadcast. for and in our our to in release press use I the up about to We stream sign

for Analyst to next be live-streamed excited will that tuned also an with website office presentations on College details Stay via the Day. are our to our more website. Investor for our hosting we month Additionally, Day Park registering be from Analyst

our workforces to to groups their for economies we're To systems get prepare customers the ready with roadmap, quantum. working use on help upcoming and forward-looking

researchers, ICT to As become a and or memorandum students, Science signed South a an education example, quantum professionals. we of of understanding Korea's core industry with recently provider for Korean of Ministry

not to to partner honor accelerate be the Korea's South might President Korean thrilled to had government could We nation's be to more initiative. also how with meet the this quantum discuss economy. IonQ computing on We South the with able

worldwide power select accessed We seeking believe access this our globe of can announced AQ by for that available access. the and new to partners, be in full is of near-term IonQ XX Previously, its partnering Forte the customers powerful machine direct XX Forte our took systems. was prepare all systems any to IonQ IonQ, only now available across potential when our but via broad towards direct customers. of June, AQ of platform to the our we our another customers to with step order are In we accessibility

is Last believe a published we and partners National used week, modeling Laboratory molecule. structure Ridge quantum our at a molecular its chemistry manuscript is benzene solvent evaluate widely industrial the commonly a used Oak to with on benchmark Benzene benzene expand Ridge we most quarter around computer accurate the Oak to additional Clearly, the had run date. another to We work with world. a continue strong represents on algorithms. model quantum to institutions as our we have

we scale a not delivered of IonQ around have now computing whole. corporations XX, and our we quarter, and has more IonQ and bookings progress as could months with We of phenomenal world. that the ahead the path a schedule, believe future seven Last AQ to translated clear We quantum of from be growth. to buy-in optimistic on institutions promise about

over to numbers. for of review more I'd Thomas? Now, to Thomas call like a turn detailed the the

Thomas Kramer

Thank you, Peter.

European that dive office customers up future will the our will to also we operations. opening Before to announce partnership be we region with in major us corporate service results, of pleased the we are first our our represents into financial to Switzerland. in groundbreaking location in expansion European and This a in addition international milestone IonQ QuantumBasel, allow

this detail. quarter's more in financial through results walk let's Now,

us mentioned, work for milestone-dependent $XX Peter in million revised year-to-date, schedule of being expectations towards year. between quarter revenue. exited end the excellent previously full in the above excellent $XX progress million our representing $X.X provided. the some of to we $XX.X an million was This of newly we with had As able of compete bookings our to million which outlook for revenue, ahead the recognizing high quarter, reflects We

While consider the time. come since business again bookings range we already raise in range what the bookings new pipeline focus has for of average weighted XXXX. we to clear most reflect that our likely believe is our prudent we've accurately in increased it our to Thus, June, into outcome

for are previous we still want I of at that the calls earnings time. bookings lumpy some our to Given from expect quite commercialization phase, continue comments be beginning reiterate to we my be -- that to

the income statement. Moving down

development period. anticipated costs To period, demand, XXX% down Recall previously For given QX at prior the especially were $X.X $XX.X making million build up million, capabilities and were the than for anticipated more plan in year that expenses for further, second XX% quarter the are year. we investments XXXX, million and the costs to significant the from in the but $XX.X in million, $XX.X investing systems second in prior total this well within and our on near-term. our in R&D manufacturing research up focused are our quarter break year from operating for our

million and sales prior investment our This $X.X additional Our functions we from efforts. into bringing our growing personnel year in were as increase due on quarter period. continue sales costs marketing million, support was go-to-market and the us in up and to XX% the $X.X second our commercial

$X.X from the in in second general prior million quarter year were Our $XX.X the costs up XX% and period. million, administrative

has $XX.X warrant of of $X.X in All related include value the million to quarter, for the net loss of $XX.X these It's compared fair million note year second the a important that million to in non-cash the second loss results in quarter resulted this our liabilities. a to period. of change in prior

our which less and fair our lower as reminder, As non-cash find loss. gains stock is we see Conversely, understand price change more losses we these steeper stage at XXXX. we this that contributes price net balance are our are warrants in importantly, in GAAP value business why sitting result our a increases, metric. net growth a when helpful performance, IonQ's combination loss, the GAAP in believe a investors helpful for on operational of our to When sheet decreases, looking a stock to a EBITDA is adjusted and these

year an adjusted compared $XX.X million in the loss year the quarter of $XX.X of projected EBITDA million. the to that loss we million, an $XX.X loss prior an Note period. saw for We EBITDA for adjusted second

loss, hit accounting for believe XXXX track are to still our we we projection. prior quarter's this on So

sheet. equivalents XXXX, as investments Turning million. and were $XXX.X XX, of now to June balance our cash Cash,

this be of player, industry us to the with that pure well to believe nascent position, structure. execute current roadmap to understand quantum continue which current any We on our public positions we cash the strongest

quarter full second our to turning Now and XXXX year outlook.

we will a for increase throughout outlook full of to our XXXX to year milestones our million able revenue represents year. the contracts that accelerate be our $XX.X $XX.X pleased are This customer some We of to on to expectation million. against delivery range the

and are third guidance also quarter introducing We $X.X revenue $X.X between million million. of

we increasing XXXX million. mentioned, year we for a the full $XX range our million bookings outlook to As of are $XX to

with that, to And would call back I the Peter. to over turn like

Peter Chapman

to has future. Thank today the who you joined entire team quantum course you, on around everyone mission of the to to who forward Thomas, us push IonQ a and continue thank and our of globe

Now, over to call our to the for I'd operator Q&A. like hand

Thomas forward team I that but ahead years is look and work. the with hard have you I to this management earlier, of their to to team I the working said company executing to our to just rest very all and and say like progress. very accelerate should well. say this much continue I the The and thank for wanted

over the turn Q&A. now call for I'll

Operator

this proceed with is first Williams question the Benchmark And session. At Instructions] line from David Please we’ll with be [Operator question-and-answer a you. time, your questions. Thank our Company. conducting of

David Williams

Thomas Hey, and Peter and congrats good team. afternoon, and the

great guys job, are on doing progress. congrats the You a and

Thomas Kramer

Thanks, David.

David Williams

months in think we of months. first, think multiple kind of, we that about, XX XX what How about machines think you more and should way realistic could should next to potentially machines maybe I guess, mentioned over we sell about that? maybe, think how you about from a Thomas, in the next terms revenue potential when the many

Thomas Kramer

our have sales gave to come on and accelerating doing back for our So guidance well. we QX call. time. at for -- our will do actually have point We lot What a recognize are that exactly how much given know year in faster we this. guidance thought. very we sell seen will we we the what requests But this we're and we for And, inbound we we that of is machines don't year, many we this next know -- we are any than

we talked seeing thought. the faster that realistic we than lot said cloud. about we one machines public, mostly just and And them what to As premise. went putting We're you that happening access recall, on day via it when a would become selling we

David Williams

you Okay. Still the magnitude there. just that six system last on quantify appreciate just what maybe, progress AQ interest to you seeing? magnify then seen can And the interest XX but the can had, you’ve maybe And the months, the maybe had, of or help since, released you've level not and guess, how of of a you’ve the inbound improve? way in terms you're you there that is the have I purchases, over interest quantify

Peter Chapman

would said, What get there. there's is, closer XX, we're here answer a I as beyond we at lot well -- to of it's interest well simulation I clear as I guess that what -- we We're point. AQ that

I say that's recognize to you means, if will, kind kind starting going going you is And to know if to would of are moment, up ChatGPT so, be wake to -- what quantum. what are people that customers quantum's of that

it's So that through we're to that excitement inbound. in of seeing we're come and starting -- now terms see

David Williams

seems It what what I are hear, forward? it would And When to (ph)? forward, the this you're to direction, cost, -- it there expense, or one ever [lift] causes as but, what is what want think do with or Is Okay. is I customers a there not hesitation, can. hear do last everyone customers, negatives do to guess, makes speaking the if often you just reason? just move want a if move not most or one you somebody move you like is

Peter Chapman

at was to a happen. What I AI There over it's two was probably years at OpenAI before never say people is Sam Altman that point like, of ChatGPT. said would lot going that, who

turned And it wrong. out so, they were

doing. large. to roadmap, still we disbelievers tech So, we execute continue against we industry what as were our said as have in But, our just a we

will confident And that. it. We're doing continue so very we in

David Williams

Thank you the for time. congrats. And again,

Peter Chapman

Thank you.

Operator

with comes with Needham. of line the Bolton your Quinn question Our from next questions. Please proceed

Quinn Bolton

guys. as sort another and QuantumBasel works? two, behind strong can sale not walk these be related a little of sort on all echo at bit guess, it front. shipment? the actually congratulations percentage of you take the you represent month sort for of and it technically Is on a And I you will us had a of Hey, of a one and I'll sell rev accounting completion hardware? and, how the Thomas, Is systems, transaction on there rec annual that through customization now like because both sales time? it quarter a delivered then the sort of it's recurring maintenance will question alongside could of or you've revenue is the service contract that

Thomas Kramer

Absolutely.

back can for of actually into earned actually into out look a this the machine. accounting to they of, this us yet flavor periods essential of have of we the ground details already of computing before in our actually Europe, remote. we the slightly remainder will But but future, when on the themselves we several ongoing to they will on-prem also will service. today, of there. for take So, already quantum And some will will that systems haven't and so on-premise we using a actually quite extend good access with people will will an next recognition having get When the localized a have go-to-market maintenance pretty work, contract But flavor probably and the there capacity idea this because while different with on that complete, of how get into the resale more we're have the opportunity point the Europe this of because up starting be also ongoing entry year. that but it's we we be familiarize power ourselves as install one with this going probably call how to service can the

Quinn Bolton

months then for XX in seven advance. And AQ Perfect. you hit guys Peter,

advancing of sort one You've per been AQs month. about

seems multiple got year. XX in we've like still and on months left this hitting well track So you're

seems AQ maybe advantage XX, an even it's AQs month. It's obviously might guess XX. I achieve applications. timing So start to forward the where per on AQ that on surprises look acceleration of certain as like to quantum I in But you

time? so, biggest of Is Is about And you. in the AQ hitting you type of in ‘XX? are laser it are how AQ feeling Thank it in XX What couple years’ What XX the biggest hitting of the you're using traps? system? milestones? ion ion to are kind the challenges a the

Peter Chapman

Well, do first which ‘XX. quite of in machines, buying one is is kind have of here we by we confident And those validation about feel customer QuantumBasel it great. hitting

there is multiple, make it's de-risk to kind want it it roadmap. but have sound -- able in challenges various taken challenge. have be technical of all and Just to They don't to I easy, approaches outback. technical the a like is, the

So for risk to -- that going appropriate milestone. so sure investing multiple different be we it able we're of And an make hit kind outback, to to analysis there's do that's ways in on. that

a it a from optics, quality and it gamut. is of things, of to -- lasers So everything runs whole range

are but our it, so the So, hitting very we done roadmap, in far, like confident hitting we've into future. just

Quinn Bolton

Thank Great. you.

Operator

Trevor is Janoskie question your line next proceed Sachs. questions. Our with Please with Goldman the from of

Trevor Janoskie

progress. some Thanks Yeah. letting Trevor. ask me This on and all. for congrats questions is all Hi, here the

the does think system were to clarification, start there bookings about quarter other how with we this? or just So no mean sales being $XX in equaling million a with $XX should million, and this QuantumBasel bookings

Thomas Kramer

it QuantumBasel. foreign that. conversion. that of rounding from mean also the majority the But bookings mean course does to It The currency of not due came and reason does is

Trevor Janoskie

one another And on sense. systems. Okay. the Yeah. That makes

we managing you're could could $XX million be all? single XX% for gross you're a mean system? of of where each ASP what $XX margin all the systems Does systems. or million, So agreement system for if that with at it a sale or the any system, you system for not of the take, be I two can your also about it these managing give but guess $XX co-managing infer million were being that not And of single QuantumBasel

Thomas Kramer

That's an excellent question.

I let's already model pricing, second our US. goes right the to because and in the, comes I here ballpark. And use mentioned deals in I of all be not same and a gross we ground. the when QuantumBasel go that, remote the on we are call XXX%, think when different said And aim up more. the to that to when we shouldn't sell think backwards. look on -- specific already an and their These the break into And access which to XX%. will pricing are The maintenance for in have, service actual elements we do it you cheap to pricing, a that different current we alluded margin to but you service is this. that we also and out there's lot running large elements we earlier machines, the prefer forward the not doing the

Peter Chapman

take we're Trevor, up to reasonable a price a machine at you for with willing you, now. right

can in add pipeline we we're who here You as little different the have as have the customers just bit I'll to off a drive lot it needs. speaking. that

pricing. so different And there's

quantum and AQ looking to build internet. companies XX quantum looking for working those quantum the and there's quantum will which be different for needs networking systems. priced They're instance, They're networks future they not For in memory differently. have now on are

a is wants. based the different each on is little the and a little customer pricing So customer what different

Trevor Janoskie

Okay. if may. And one I more,

sales, is AQ Aria or interested to customers that are well? your also AQ So considering XX they QuantumBasel, in XX that interest system there the coming are are are and XX these as in mostly you, like

Peter Chapman

items to big these are, you In year as kind a have of usually terms sales, cycle. of through know, run that system budget and also a you ticket manufacturing

looking usually forward are a year. at people least So by

so they're And looking the at roadmap.

get They say is, delivered are they interested next much in So year. AQ I would that can't what people very know XX.

people so I XX of really, are XX my thinking, started. can system systems. I then we and get for excitement But a can they're I well, start application programming So and AQ an lots access think to see get started AQ get

Trevor Janoskie

for Awesome. Thanks guys. the color

Peter Chapman

Thank you.

Operator

is with [Operator WestPark questions. line Instructions] question with Please Kevin next The your Garrigan the from of proceed Capital.

Kevin Garrigan

let strong Tom, congrats echo Hey, results. Peter my the Yeah. on and me

kind since Going use off you last a can of signed sense new kind and any questions about us since since of how launched commercial give out? commercial of interest, customers you up to customer on David for for Forte many point Trevor's you everyone, you and

Thomas Kramer

happy So, you asked that question.

already have business make welcome everybody work we year else it. to also on sure system incoming calls that we commercial customers and for you right late As What for on we're and want customers is earnings we with all to this continue to we last several that know open know, call. since after

Kevin Garrigan

it. Okay. Got makes Yeah. That sense.

follow-up, as announcement an a quick are give of things with QuantumBasel Okay. progressing can Seattle? with update you guys and the your in you two and on then just the us systems, facility providing partnership how manufacturing

Peter Chapman

Yeah, very much.

So, probably a thing permits. very factory, the get building to when as do is you you first know, have building you're

think, to get completion. roughly long we heavy come in were I And is Seattle. got, roughly we see and fall enough first hot of to we expect lucky phase XX we've And, And Bothell, the And ago. construction -- people the construction XX so in Washington. already those, to not -- as stretch this so speak too in

to they on know, fall. a budget start starting also let will company our as also anyone Oh, and just timelines Bothell Little we're know, reporting office hitting you a well. but the so, as and it's it's be this it's -- to did And well. to We're construction timeline.

managing facility well. we're building So manufacturing over as

Thomas Kramer

beautiful. done it's the it's we there hard a can day add, hard this professionally on was hat orderly. office ribbon. and done. forward IonQ to in on. the my is I have walk we out It's up. through, started I you very building now XXth just Like, actually there If build when being a very Like, I well when weeks even And, ago, order to put vest, probably couple Yeah. cut was a It's a you hat And with of nice not sight. logo very, very, in might and little a offices, have

Kevin Garrigan

Yeah. as We're all well. looking forward to that

Thanks guys. I great. appreciate the Okay, color.

Peter Chapman

Likewise.

Operator

this the you. Chapman call Thank for end turn I'll to And the time, question-and-answer over At of closing we've session. remarks. reached the Peter

Peter Chapman

for seeing our afternoon. IonQ and We for everyone Analyst at Congress. to and you to exciting you Thank Day Quantum this look the ahead joining forward us Thanks everyone. times World

Thomas Kramer

you. Thank

Operator

This will conclude today's conference.

You for time. may disconnect Thank lines at you your your participation. this

IonQ (IONQ) 10 Aug 232023 Q2 Earnings call transcript