Behind D-Wave's Massive Week (And Why Rivals Also Popped)

In a period of five days in late September and early October 2025, shares of popular quantum computing firm D-Wave Quantum Inc. (NYSE: QBTS) spiked by nearly 22%, capping off a stellar month in which the stock more than doubled. While QBTS shares stand out across the broader market, quantum rivals like Rigetti Computing (NASDAQ: RGTI) performed even better during those periods. D-Wave's latest gains are largely attributable to two factors: a suggestion to investors that the company's annealing quantum tech has broad marketability and sector-wide momentum driven by encouraging news posted by others in the space.

For many investors, the industry-wide gains of recent weeks may signal that it's time to invest in a quantum tech-focused exchange-traded fund (ETF) to capture a wide swath of the gains in this sphere. But for those primarily focused on individual names, the question becomes whether D-Wave will continue to stand out and if its torrid growth will continue despite significant overvaluation risk.

Proof-of-Technology Success for D-Wave

The latest bump in QBTS price has coincided with news released at the end of September that the company achieved a key proof-of-technology milestone in—of all places—Wales. The project involved a collaboration with the North Wales Police to utilize D-Wave's Leap quantum cloud service in a hybrid-quantum model used to optimize the placement of police vehicles. Thanks to the partnership, the police force has been able to reduce incident response times by 50% on average.

The takeaway for many investors from the success of this project is that D-Wave's particular area of specialization in the quantum world, quantum annealing, now has another crucial and demonstrable advantage over classical computing systems in a real-life and marketable application. This has long been a major barrier in the quantum world: as impressive as the technology is, it has so far remained elusively theoretical or niche. Demonstrating that D-Wave's technology (and specifically its cloud service, rather than its ultra-expensive Advantage2 system) can yield such practical benefits may go a long way to attracting other customers.

Of course, a proof-of-tech demonstration does not immediately equate to profitability or even to an uptick in revenue or orders, all of which will be evidence that the company's financials are on the right track. So cynical investors may very well point to the latest stock surge as yet another bit of hype surrounding D-Wave that is exciting but, ultimately, speculative.

Rising Tides Across the Quantum Industry

The quantum computing world is in a sufficiently early stage, and promising news for one firm tends to give a boost to others, which coincides with the recent price surges as well. Rigetti, for example, announced in late September that it would sell two of its Novera quantum systems for a total of about $5.7 million. Meanwhile, news broke that the Danish government will back a new €300-million quantum fund.

Despite the promising signs of commercial interest in quantum systems and new government support of this technology, investors should keep in mind that the space remains highly speculative and risky. D-Wave's price-to-sales ratio is a whopping 502.4, and the company continues to post losses. Having posted more than 240% in returns just this year, there is a strong argument that D-Wave is significantly overvalued. Indeed, despite widespread analyst support for QBTS—11 Buy ratings and just a single Sell—Wall Street has estimated that the firm has a consensus price target just above $20 per share. This is close to 40% lower than its current price point.

What might need to happen for D-Wave to become less of a speculative play and more of a reasonable bet on the growing quantum industry? Investors may have to wait until the company's next earnings report in mid-November for confirmation that it has been able to begin translating its impressive tech developments and investor excitement into top- and bottom-line performance, among other things. In the meantime, those with an appetite for risk might still be able to find opportunities for gains as D-Wave and other quantum firms continue to provide sales and development updates.

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The article "Behind D-Wave's Massive Week (And Why Rivals Also Popped)" first appeared on MarketBeat.