By many measures, quantum computing leader D-Wave Quantum Inc. (NYSE: QBTS) has had an excellent start to 2026, but the most impressive statistic of all may be that in January alone its bookings exceeded those of the entire year in 2025. This was thanks to a $10-million deal with a Fortune 100 company and a system sale worth $20 million, primarily. At the same time, the company's cash reserves remain stellar as D-Wave positions itself as a dual-approach company with multiple technological paths.
Still, QBTS stock is not thriving: shares have fallen by about 44% so far in 2026, despite the company's promising news. For those already holding D-Wave shares, the question of where the bottom may be is likely to be top of mind; on the other hand, investors not already invested may be wondering if it's worth holding out longer to get a better price when buying the dip. In short, while it's impossible to say precisely how much farther the D-Wave selloff may go, a closer look at D-Wave's operating runway may ultimately put a limit on dilution risk for the time being.
Just How Rational Is the D-Wave Selloff?
Despite the seeming paradox of D-Wave's selloff amid some strong fundamentals and exciting developments in its latest earnings report, there are reasons for investors to believe the selloff is, in fact, rational.
D-Wave has undoubtedly seen major growth in its sales—revenue came close to tripling year-over-year (YOY) in the latest year.
In absolute terms, its sales remain quite small at under $25 million annually, particularly for a company valued at close to $6 billion.
In combination with a massive rally that took place throughout much of the earlier part of 2025, this means that D-Wave's share price has become significantly inflated relative to its sales.
The company's price-to-sales (P/S) ratio reached as high as nearly 327 last year, and even after its latest decline, QBTS still trades at more than 237 times sales. Investors may find this figure helpful as they seek to determine whether the selloff is justified.
Determining the Bottom Is Tricky, But D-Wave's Cash Reserves Provide Important Insulation
With a relative strength index (RSI) around 30, D-Wave shows some signs of being oversold. Selling in the latest trading periods may therefore have been excessive, but that doesn't necessarily mean that D-Wave has reached the bottom of the current selloff. Of course, predicting those levels with precision is likely impossible.
At the same time, though, investors might take note of D-Wave's cash position, which was an impressive $885 million as of the end of the last quarter. This suggests that D-Wave has at least three years of operating runway based on its latest burn rates—not including potential major acquisitions that could be coming in the future—even if it does not continue to grow its revenue, which seems unlikely.
This is all to say that it seems unlikely the decline will continue to $0 in the foreseeable future. Investors might see this as important insulation for D-Wave in the face of escalating selloff pressures.
What Signs Might Investors Watch For to Sell?
If it's difficult to assess exactly how much farther D-Wave shares might fall—made even trickier by the fact that the company still has a solid Moderate Buy rating from Wall Street analysts and upside potential of about 132%—investors may want to watch for other signs. Certainly, if the fundamental factors above change (if bookings slow down, for example, or the cash burn rate speeds up significantly without a corresponding increase in revenue), this could be a red flag.
Other potential issues may be less obvious. If D-Wave's core gate-model system, which it is developing in addition to its pre-existing annealing offerings, sees delays or other issues, this could further suppress investor enthusiasm for the company.
If external factors like tariffs, supply chains, or similar issues take shape, the calculation of D-Wave's capacity to sustain itself with its cash holdings and to accelerate revenue growth could change.
Ultimately, D-Wave investors must reconcile multiple competing arguments. On one hand, the company appears to be oversold amid its major decline in the last few months. On the other, it remains massively overvalued relative to its latest sales.
This may be what separates out investors looking for a share price reversal and a return to the 2025 rally from those with a long-term conviction that the company will come out on top in the race toward quantum dominance, which is likely to go on for many years to come.
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The article "Where's the Bottom, and When Will It Be Time to Sell D-Wave?" first appeared on MarketBeat.
