QUBT Lags Peers Over Three Months: Are Widening Losses a Sell Signal?

Quantum Computing Inc. QUBT has struggled to keep pace with its peers in recent months, with shares slipping 4.8% over the past three months against the broader industry’s 10.3% gain. The stock’s muted performance comes despite the company reporting a string of technical and commercial milestones in its second-quarter 2025 update, where management highlighted progress across quantum sensing, photonic chip manufacturing, AI-driven reservoir computing and secure quantum communications. Financially, revenues remained modest at $61,000, while net losses widened primarily due to non-cash derivative liabilities tied to the QPhoton merger.During this period, shares of QUBT’s major rivals Rigetti Computing RGTI and D-Wave Quantum QBTS gained 46.4% and 8.9%, respectively.Three-Month Share ComparisonImage Source: Zacks Investment ResearchHigh Dependence on Early-Stage and Government ContractsMuch of QUBT’s revenues comes from pilot orders with research institutions and government agencies (Delft University, NASA, NIST, a South Korean research institute). While these validate the technology, they are generally small, project-based contracts rather than recurring or large-scale commercial deployments. This reliance on early-stage customers makes revenue visibility uncertain and raises the risk that growth could stall if government funding cycles or research budgets tighten. Until QUBT secures sustained, large-scale commercial adoption, its business model will remain exposed to volatility.Revenue Decline and Widening Losses ConcernQUBT’s last-reported second-quarter 2025 revenues were $61,000, down sharply from $183,000 a year earlier. Despite customer traction across research institutions, government agencies and enterprises, current sales are not yet meaningful relative to QUBT’s operating scale or long-term market potential. Management has indicated that meaningful contributions from its photonic chip foundry may still be 12-18 months away.Meanwhile, second-quarter net loss widened to $36 million from $5 million a year ago. While part of this was due to a $28 million non-cash warrant-related loss, operating expenses also doubled year over year as the company expanded headcount and R&D.By comparison, Rigetti appears better positioned than QUBT at this moment, having recently launched its Cepheus-1 36-qubit system and bolstered its balance sheet with over $570 million in cash and investments after a major equity raise. D-Wave is also ahead, rolling out an open-source quantum AI toolkit integrated with PyTorch that enables practical machine learning workflows and expands its developer ecosystem, signaling strong adoption potential.Yet QUBT is Positioned for Long-Term GrowthQUBT’s long-term growth potential comes from two main areas: its quantum machines and its thin-film lithium niobate photonic chip foundry. The company has already started shipping products such as the Quantum Photonic Vibrometer, entangled photon sources and its EmuCore reservoir computing system to research institutions, businesses and government agencies. These early sales demonstrate a genuine demand for QUBT’s technology, creating a path to larger markets, such as secure communications, edge AI and advanced sensing.The new chip foundry in Tempe, AZ, gives QUBT a way to scale revenues more quickly. The facility is already fulfilling pre-orders and management expects it to start making a meaningful financial contribution within 12–18 months. At the same time, QUBT is building stronger ties with government partners such as NASA and NIST, which help boost its credibility. With $349 million in cash and greater visibility from its addition to the Russell indexes, the company has the resources to push forward.Average Target Price Shows Strong Near-term UpsideBased on short-term price targets, Quantum Computing is currently trading 18.5% below its average Zacks price target.Image Source: Zacks Investment ResearchEstimate Revision TrendEstimates for QUBT have widened from a loss of 7 cents per share to a loss of 17 cents per share for 2025 over the past 30 days. Image Source: Zacks Investment ResearchFinal TakeDespite QUBT’s promising long-term strategy in quantum machines and photonic chip manufacturing, the near-term outlook remains challenged by declining revenues and widening losses. Shares have underperformed peers like Rigetti and D-Wave, both of which are showing stronger product momentum and financial positioning. With estimates trending downward, we recommend selling QUBT, a Zacks Rank #4 (Sell) stock now, while monitoring the company’s progress for potential re-entry once its commercialization and revenue ramp-up become more visible.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.See our %%CTA_TEXT%% report – free today!7 Best Stocks for the Next 30 DaysWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Quantum Computing Inc. (QUBT): Free Stock Analysis Report Rigetti Computing, Inc. (RGTI): Free Stock Analysis Report D-Wave Quantum Inc. (QBTS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks