IONQ - Earnings call transcript Q3 2024

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Operator

Greetings, and welcome to IonQ's Third Quarter 2024 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Jordan Shapiro. Thank you.

You may begin.

Jordan Shapiro

welcome Third and Call. XXXX everyone, afternoon, to Quarter IonQ's Earnings Good Relations name I'm Analysis Planning Investor and Jordan and at Vice of My Shapiro, Financial the is President of Head here IonQ. and IonQ's Officer; be to Thomas today's Peter Executive pleased am President Chief joined Chief Financial I and our Dr. call on by Chapman, and Kramer, Officer; Kassmann, our Technology. Senior Dean Vice and President of Engineering Investor press is access everyone the company's the earnings should available XXXX which afternoon, have to section website release now, our this By quarter issued of at Relations on third investors.ionq.com. EBITDA, management Please non-GAAP is on today's note measure. that will call, refer financial to adjusted which a

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

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

our are as forward-looking we other make business forward-looking outlook During and a week. will and Actual revise today. XX-Q statements materially call, of undertake SEC risks the on filing obligation in this required by occur the as number except mentioned based reflect our could with and from uncertainties, including events to or the to discuss call, differ changes outlook to any results comments our due of These this statements. statements no that We those after beliefs law.

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

Peter Chapman

for to Jordan, Thanks, and you joining today's call. everyone earnings thank

about, let's in. lot talk a to so have We dive

trajectory. contract quarter, $XX.X and exceeded annual In are million revenue, revenue in we leading guidance third our front, of raising industry we on the our financial new the commercial our with bookings. On expected brought range the

announcements We on AstraZeneca ANSYS. quantum and development with the are of applications game-changing making

leader our our developing manufacturing acquisition driving networking push in via our solidified a networking of of and sharing And into after our our technical we will initiative. contracts networking share more, partnerships industry. announcing less rapidly the of progress What's a news details are Qubitekk, than quantum it. we year the that We quantum are recent have some the

million more in delivering exceeded compared range to we revenue represents range for for of end our This our announced range the to mind, million $XX.X our we well With a also raising the high quarter, Lab million in $X third for more million of contract of We million. $XX.X a IonQ for revenue as fourth renewal revenue once Air United $XX detail, quarter. close $XX revenue So Force $XX.X doubling Maryland. full the $XX.X and with quarter million recognized $X in year to the than our the million. of Research to $XX.X IonQ guidance our that within year-to-date the XXXX again quarter million of of for XXXX as and This new to brings are year our the with target University guidance a existing bookings million customer, States $XX range million, year-over-year.

raising company's double including revenue traded, row. track times calls, earnings the years of our expectations we that or past to the X will us out of in since original continued success for guidance in Meanwhile, growing have we revenue or IonQ our high of up of bookings in bookings beating bookings sales each its our end the exceeded XX come revenue. our the date, targets set third believe recognized year our for And bookings roughly next will to progress now course, to success closer Given we are a for been publicly year we the today. has on range. XX

ability of depth. one in addressed the sadly, keep has convergence of Our a camps can for financials near to this way by need delivering commercial can If long The thought are and the that IonQ's The answer a discuss be quantum quantum matching year. every application is The but perfection short, powerful range quantum you day. camp success. potential guidance quantum is computers, for our on Everyone, correct, applications. at still will enough off. schools want at the camp, their In when high believes of scale be we IonQ unlocked. and our naysayers exceeded the every they before thesis world, investment One ignore Thomas manufacture end our there promise. high of topic. belong scale. the hardware revenue this no and are annual on dwindling growth, value customers X investors to impossible are can is know In numbers alike previously more or tasks to longer

engineering as applications application Instead, identified potential supremacy. The believe team commercial them, several we about value where the it ask disrupt areas argument XX I what answer industries. have first to The meaningful early out towards to value forces perfection. joined gives accelerate lines, partnership more time world-class ANSYS AstraZeneca. our months computer-aided generating told growing with to with in faster hardware our global to by the scientists both manufacturing algorithms bioventure can on will the hub will develop software announced I be and I application The care other that computers be aimed I biopharmaceutical us to for value marks computers. advantage the the critical are innovation aligned quantum camp, significant development announce others we IonQ I and in the the a to, challenged academic seamless about multibillion-dollar Gothenburg, of today's don't partners quantum since to In expand belong the of teams making and quantum have the creation theoretical engineering a computer-aided excited revenue. capability. simulation reach entry has and ANSYS experts right, exploration realized innovative industry, provide sales to are about industry, a seminal we non-experts always which limited industry and I their care perfected. enabling understand power we simulations applications by with integration as before respective product don't cash quantum to products. the in IonQ believe industries. with applications our noisy early X at areas, drug in industries. AstraZeneca's collection allowing development And reduce We if collaboration To reached to experts and application biopharmaceutical discovery Sweden. goals, these ago, applicability. In even between and them, industry new is for About we am question. IonQ's Today work a next-generation design IonQ first market simulation, and the high-fidelity practical planned they moment IonQ of application accessible and are their aggressive leveraging then production center has Quantum quantum our

drive We systems by incredibly expect us to these for We've the demand to also production, an to reached unlocked value projects up XXXX. in for but new will $X share in that economic be applications you McKinsey much applications not point, AstraZeneca production-grade be ANSYS excited tell to these I how bring and applications. we personally excited I impactful can't with am could and their to quantum partner about industries. respective more to trillion

the computing networking. inherent the only contributing to networking in leadership. believe early company that is to that quantum Now switching We an has advantage focus quantum market, quantum our our IonQ

to we highly for Specifically, relied are always quantum architecture networking IonQ as and networking of computing part computers. synergistic. have upon our scale Quantum our quantum

definitive patents. up announce strongly scale to Intelligence also investments of drive Qubitekk, contract believe and like international excited of become million are AFRL the the to computing a photonic is build to to product that $XX.X momentum production for with quantum the with that allow growing rapidly the our company. years ion well the significantly hardware quantum To our sales we and networking acquire orders onto million is made products suited, entanglement, are California-based estimating cash large system and several that technical have hardware, more investments expect of over IonQ past and more Vista quantum Our continue Qubitekk's require to in networking physical of paying a expand market also the is agreement to first networking, leading team or quantum by quantum communication recent Qubitekk we Security a where XXX expected billion quantum milestones group is element off. granted At we another to us to of today, opportunity a IonQ alone continue Internet. will wins market addition that X capabilities. and particularly sales to of leadership, manufacturing XXXX. ARLIS, will is IonQ The second the catapulted with networking and interconnects scale $XX contract our Laboratory I networking $X.X required of flow million, infrastructure U.S. capacity. have be classical networking the Quantum the have leading these quantum combination industry. the networking we networking than given become positive. McKinsey a IonQ Research signed This that The significant magnitude demonstrated X Quantum will the develop by examples $XX player our quantum for our in to a and than networking Applied on

quantum networking, more thrilled Qubitekk we're are quantum we While and our in thrilled join even with progress their forces expertise. networking technical with to leverage

with optical to improve Number to are our X The size, photonic center-ready trap to a developing new delivering Hamamatsu of chip power data future technologies in for ion XXXX, will also new partnership nanoelectronics systems, laser innovative begin subsidiary ion a circuits Tempo. upcoming Photonics scale world-renowned IonQ critical with on a the in computers. hub and and a NKT components subsystems two, develop systems weight NKT am front, one, Photonics I quantum starting with to to and Photonics, equipment. announce integrated happy develop we prototype the partnership our today, performance, computers us and designed with imec, we technology. innovation digital announced pleased technology next-generation networking of announce arrangement to for Lastly, and X Number trapped agreements of

and company. Many With and position the to software computing preeminent count improve short near be a The of application as system networking. and these believe come. qubit are now company. hardware of the size term nothing player at cost, in the overall a groundbreaking are groundbreaking the we quarter the and system in years know quantum leading you likely of also company and you know intersection already IonQ quantum computing quantum With future, today's And will leading announcements, as many performance we us aims in developments to and this industry IonQ of increase technology, IonQ reduce scale. for the to that

towards technology Our IonQ track of over companies rapidly like achieving X to time. record by with I'd record the figures commercial growing call has to in launched Thomas. young rarefied the turn that, And bookings echelon in

Thomas Kramer

truly has our It Peter. and been an you, financials on exciting and Thank exception. are no front, the quarter commercial applications

walk results in this Let's financial more through detail. quarter's

$XX.X revenue completion make anticipated more progress primarily is had high previously strong range As use end our percentage overperformance we revenue a This of quarter, due Peter to the than mentioned, our previously of the some recognizing was of contracts million, we that on to which recognition. provided. above ability

third sales $XX.X quarter. booked also We million the in of

We particular As we in or a for earnings since cases, some difficult sale even year. confident anticipate in will it prior bookings calls, bookings is exactly quarter-to-quarter to lumpiness year-to-year predict the materialize. we in when our target have in remain mentioned our

the statement. income Moving down

year. from our expenses operating in $XX.X growing year million, the R&D our the period, $XX.X this that third costs for to but costs R&D total and million development in in break plan for down within Our the XX% further, year up the $XX.X To $XX.X were prior period. for our we our quarter investing million, support are headcount and quarter research prior road the map from heavily third and were Recall XX% million commitments. customer and up

due marketing period. in sales third the into our were up and $X.X XX% the This commercial million, marketing our was million our year Our as both efforts. our growing to we $X increase sales costs from in teams quarter continue prior investing and

million, increase by primarily $XX.X payroll-related prior general $XX.X Our were in million increases an period. X% These the costs and quarter were from administrative in third expenses. in driven the year up

compensation the loss period. third Accounting $XX.X All third compared million growth, liabilities. the the warrant our third related quarter can the of the results. of an for of quarter prior growth million million have be always third to adjusted loss million We net was quarter the our in to value year include this in saw This in impact pointed for noncash compared in year warrants out our million quarter resulted $XX.X million the they a stock-based of we loss related $XX a to loss for the also so prior $XX.X which of for $X.X loss to $XX.X have the These period. QX $XX.X fair prior headcount expense in compared on period. results million a year includes for confusing, EBITDA to

an We continue adjusted year $XXX.X to project loss million. the EBITDA for of

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

to is publicly the strongest stack computing. on position full traded company continue believe this any We cash focused of

those this systems. increased who have beginning Importantly, are while large in from including we purchased have IonQ's payments offsetting to years, by customers, rate collect we IonQ's run recent

employee now management Board in setting rapidly in and the we us. to a bring mentioning up investment our the Our rapidly related quantum quantum talent are also manufacturing on computing the run team of are to It quantum worth networking largely as significant behind is that best leading costs to worked rate have both focused segments. portion being increases IonQ. is expanding IonQ's and business

coming corporate market are growth, goals in years profitable flow quantum commercial cash free positive the Our and leadership.

turning financial outlook. Now to our

We our $XX.X XXXX full to the confidence percentage confident quarter raising XXXX reflecting our $XX.X guidance bookings progress that to revenue of our on to revenue for are for Back will completion-based of in our announce guidance million and remain range year and between of million a million, be $XX.X to We our pleased fourth million. $XX of contracts. you, We million in currently million. $XX $X.X Peter. between expect the we

Peter Chapman

Thank you, Thomas.

IPO via quarter, par quarter's customer our year evidenced on As commercialization of The computing worldwide. quantum last is and combined. quantum demonstrably entire leading fantastic our third and were we with since of wins bookings have bookings our networking the IonQ

and are deal with operator in interconnects. session. milestone break making updating to fourth of as furthered quantum with our great that, to you turn like second strong our call to of our We ANSYS ground strides as to the our it path our the implementing in again a position year February. in with look to to cornerstone for we We our close leadership our AstraZeneca And I'd by demonstrated quarter million on Photonic all With and new question-and-answer forward collaborations on networking, applications. the AFRL achievement $XX.X well over

Operator

[Operator Instructions] question Williams David comes Benchmark Our first from with The Company.

David Williams

It's really what you maybe find Lots to But of interesting and exciting what things how to kind on. the hard doing Peter, can of And internally? synergistically technology brings? you've that speak just does going a acquisition, merge with that first, start. to place Qubitekk been

Peter Chapman

the our to something but of the same, same of David. Several of in networking happy, in that that be exactly kind I'd photonically talked together. past, quantum the computers about sets skill the have not we've things is terms One kind will here. way IonQ get people. Yes, doing is similar, rough Qubitekk is as And by scale they

is as side it a product well gives go other after us. it's new another market and line The to for us

So the and it's that can TAM complementary expands we go both after. also

David Williams

looking area kind quantum? And about that we an do -- thinking the about now some of and that networking And How have be in just anticipate pillar efforts the to sensing you computing at might you terms the side. is point? also you you of think have should enter

Peter Chapman

Yes.

one to So quantum sensing able quantum transport be things nice information. is often the of requires to that the networking

different computing. networking sensing, of up infrastructure quantum and kind it makes enables quantum that the again, piece It's X quantum. markets in So quantum of another

David Williams

if then one one I And may. last just

things you in maybe seen other the other quarter a it. on about or time? you industries maybe before, to And before and talk partnered alluded or one-off application past? over how where we've applications to this this specific Can And problem. You talked relative areas with about think manufacturers done you applications different about develops that how work the you've you

Peter Chapman

you of the largely about kind a R&D with of actually or for to of lot -- We one-off core an project. companies, XX it. kind expressed an times, ago. end months we've put of sometimes those maybe You've worked A

that to put production. said, on first time so we the okay, that And the now into applications we it's will focus to applications be really

get those on done. applications. we hardware didn't come hardware the the so had application we ready And same when We when want the started the as to time run software to at to exactly is software the want along

announcements for for We've prototypes don't applications. on X that today together. So What working applications with beginnings things these or and those working is on or X months I ANSYS X we're the the the timing been AstraZeneca X the know, are so. of both last, those

-- either. it's it's starting not we're completed one, So but not not at square

that's moving them camp is the third the there we So kind our of put production into as I well. a helps would do maybe can in into as Hyundai well, difference. engagements which actually that sense major now are what

Operator

Shannon next question Richard from with Craig-Hallum. comes Our

Tyler Anderson

Congratulations then Anderson and Richard does And Qubitekk OpEx? very describe the expected partnership amazing. M&A. also, the on from or swap acquisition ion chip This imec on is Qubitekk surprised, Shannon. quarter it's and could the And distillation Tyler node-to-node from be incremental will within the the operations? the require price for was the AFRL trap hardware wondering, I you contract? of then scale used I'm

Dean Kassmann

I'll your in lot is question. Dean. start. There's This a unpack to

just that regards is trap stack associated basically terms not with That of though, bell photonic the in to we they to Qubitekk announced entanglement. to the is XQ The the QKD swap first milestone and technology X the and with expect entanglement. analyzer like the of things regards photon have that in use our state part with we technology that with to to we the similarity piece the is generate actually fundamental other need the have. There that and or entanglement interconnects work

analogies interconnect the there work being as between so well And as what's the done is we're with in doing quantum networks. that photonic those

there's so parallel technology. And

it in are the different they operating technology of is now, same. and Some right the at component frequencies. But one

to solutions. our the And photonic as than currently many for fundamentally do is need so we state-of-the-art being done would what QKD need interconnects of in is you different what

our the and Your focused conversion. frequency and of imec second first, -- work. our item AFRL development with PICC in was The work some development with particular, ] question was AFRL is overall [ large the its of relationship to associated associated most recent on

to back and where goes from Qubitekk barium of actually telecom to at relate be this acquisition, So down looking computing entanglement to conversion the over to distances. long frequencies we're wavelengths push frequencies the to able other

but that the, piece play prototypes switching And work The would the The of in has say, all in instead in is photonic second really ruggedization. I there, imec far is near of but then term, areas, potential third the not network the term. those the to there. component

So think AFRL scale performance of right as of we to as we see that. contract. our period the optics we about within is stack, current about now None down think devices, expect on putting activities our the technology chip that to where

Tyler Anderson

then which And price. there was one other question, is

Thomas Kramer

Yes.

acquisition details transaction position, determined close in laid size and the the We of So funded plan quarterly the and months. to we evaluate the cash in commitment that next the sheet. for to are our X The cash we consideration out in the balance our relative size $XX the have manageable million, cash which was the is from disclosures.

Peter Chapman

which little that one the existing purchase also, is telcos. other piece, a Qubitekk add And have contracts, real-world they given with I'll their relationship just

now speak. to to the our kind out the way. questions, of us start -- so the it in moves by and Great to so of And test starting laboratory allows efforts field,

Tyler Anderson

then spending and as opportunities what more frame on the And government one size is the as computation types And across for quantitatively international strength your you Could a then opportunity national an near-term the me. those where of And application, different level? different far and buckets? networking? are of

Peter Chapman

I meeting, question. to get think, whole that another need through might We

Sorry.

of most the of just could -- that things. proud what the what to the the it. what of in I day kind IonQ expected it of think we one some are that keep to day McKinseys at I Clearly, we first and is things terms on we of to work of the do you it. maybe we've IPO, do. -- world and the and even exceeding BCGs have best going those think markets probably for doing point the the from is the We is told we're it market of

since it's not secret. So of day the much a actually the of We've it saying been IPO. first

Tyler Anderson

a all weigh involvement? maybe then just between commercial forward acquisitions moving How and the and of telco you government these And monies would your shorter. bit with little focus

Peter Chapman

if enterprise. government. in very it's switch now always towards to Again, near that's Well, beginnings the said, good of we off now take portion, you the starting is been bring these you'll the applications application projects, IPO, online. term, hey, that And can But the go plan. to start we going Â– a to it's it's these been see to over the which of switching to it's as beginning back start really soon as to

Operator

Our question Mitwalli from & with Needham comes Company. Shadi next

Shadi Mitwalli

Shadi Quinn for is in Mitwalli This Bolton. dialing

First it's in off, NKT solid to now systems exciting how computers. IonQ front. an Photonics, the IonQ's to you announced with year, unpack on photonic commercialization support just of in partnership NKT making And want photonics clear is will quarter, with lots quantum the touch Earlier But the milestone the interconnects. guys a work here. major on on Photonics I congrats

Peter Chapman

Do you want to take that?

Dean Kassmann

it a perspective, take from take and it business the technology from I'll Peter can first perspective.

side, different lasers, technology different fiber-based lasers. kind has diode laser different sets of the On technology, pulse there's different lasers, a of NKT -- and lasers,

frequencies that the trying the part us represents for looking of we we the and stability in interested as partners technology the from put we're right? And in and operation to manufacturing laser need need, just simply larger-scale agreements that the work, perspective and we for need really points and place kind and suppliers that what our scale that to lasers of supplier we're that kind systems. of operate technology XX/X cost a robust so vendors can in are as both down that trying lasers this wavelengths of that select robustness And wavelengths and larger at the so well provide to

Peter Chapman

And systems. add of question little Lasers a business, at, Dean significant cost. of kind bit it's are our on the overall just of hinted cost the I'll which which a the of these portion

sat be and cost, said, reduce we're we look, when of going to to moving to down to able reduce the also one So the the pieces production, be size.

So you promise. and investments both this that also with both us in announcements is see today, NKT these as with imec of that actually working towards

Shadi Mitwalli

And new remarks, then guys maybe and announced OpEx, And guys quarter. growth. support on the you in this partnerships number this awards talked the a all of team expanding earlier you prepared about to

forward? how just going So needs on talk to And growth. maybe OpEx think about all support how the this we team should to then much expand curious about

Thomas Kramer

used. and is we about the growth What -- us that that can matter matters time making and they where are we and to only I refunnel be areas year are now. though we it as Well, into rest OpEx not rapid already call change we always capital We're laid we QX in that really forward the are the OpEx have to and seeing the right to investing year where sure through to next think I out where well. growth, And best any for think is places we that everybody we've for which on focusing will of for on discussing the gone making earlier. look most discussed be the start what OpEx in call, it's

Operator

closing We now have call of reached like question-and-answer the back for over I'd to turn the comments. Chapman end to Peter the session.

Peter Chapman

your want you. everyone for Thank questions. I and the to all for thank for us support joining today,

work IonQ such thank that quarter look fuel that and Thanks, for want commercially Finally, the team continues and future. us a forward to meaningful to everything the in to for technically entire everyone. continued I contributed diligent the we to

Operator

today's This concludes conference.

your your You and participation. disconnect time, this you we lines may for at thank

IonQ (IONQ) 6 Nov 242024 Q3 Earnings call transcript