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Luke Kawa

D-Wave Quantum agrees to acquire Quantum Circuits for $550 million to boost gate-model development

D-Wave Quantum announced Wednesday that it has struck a deal to purchase Quantum Circuits for $550 million, as the annealing-centric quantum computing company continues its push to bolster its gate-model capabilities.

The company said that $300 million will be paid in D-Wave stock, with the remainder in cash.

D-Wave is the major player in annealing quantum computing, an approach that solves more specialized optimization problems. Gate-based quantum computers, which aim to address even more complex and broad queries, are the dominant approach being pursued by publicly traded quantum computing firms. Gate model developers have also tended to get more interest from government agencies, as their technology is seen as the ultimate end point for quantum computing and therefore more worthy of support.

“By combining the world’s leading annealing quantum computing company with the world’s leading developer of error-corrected gate-model technology, D-Wave will dramatically accelerate the projected time to a scaled, error-corrected gate-model quantum computer alongside and complementary to its commercial annealing quantum systems,” per the press release. “Combining these technologies is expected to facilitate an accelerated commercial gate-model product roadmap that D-Wave believes will enable it to be the first to deliver fully error-corrected, scaled gate-model quantum computing”

Thanks to this acquisition, D-Wave plans to deliver an initial dual-rail gate-model system in 2026.

During the conference call that followed the release of Q3 earnings in November, CEO Dr. Alan Baratz highlighted gate-model development as a priority for D-Wave.

“Up until now, our investment in gate has been light, mostly because we haven’t had the funds to be able to grow that investment all that much. Now with the roughly $830 million in the bank, we have the resources to be able to invest more in that program, both internal investment and through acquisition to accelerate the program,” he told Sherwood News.

“We have one customer who has said, ‘When you have a gate-model system, I want it.’”

This news comes on the heels of the firm’s announcement on Tuesday that it’s solved a key problem when it comes to scaling superconducting gate-model quantum computers: how to keep qubits in the same place without producing too much heat.

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Helena Cheng

Lululemon’s stretch getting tested: Stock plunges after after outlook is cut

Lululemon shares are down double digits in premarket trading after the company cut its full-year sales and profit outlook, overshadowing a Q1 beat and raising fresh concerns about the brand’s turnaround efforts.

The company now expects fiscal 2026 revenue to be flat to down 1%, compared with its prior forecast for 2% to 4% growth. Guidance for full-year diluted earnings per share was dragged down to a range of $10.95 to $11.15, below the company’s previous guidance of $12.10 to $12.30 and well below Wall Street’s estimate of $13.26.

Key numbers for Q1:

  • EPS of $1.69 vs. the $1.68 expected.

  • Revenue of $2.47 billion vs. the $2.43 billion expected.

The modest top-line beat masked a widening divergence between Lululemon’s geographic markets. While international revenue rose 22% overall with a 30% increase in Mainland China, the bigger problem remains North America, where revenue fell 5%.

Interim co-CEO and CFO Meghan Frank acknowledged during the earnings call that recent product rollouts underperformed. A highly anticipated yoga campaign failed to generate its expected “halo effect” across broader product lines.

Profitability metrics took a major hit, with gross margins contracting by 410 basis points to 54.2% due to mounting tariff costs and promotional markdowns. Operating income consequently fell 37% year over year to $276.9 million.

“We experienced spikes of negative commentary in the media and on social channels with regard to our brand, which had an impact on traffic and overall top-line performance,” Frank said during the earnings call. “And second, not all of our product launches have met our expectations. While we have had several successful launches so far this year, we have seen others as we start Q2 not generate the anticipated guest response.”

Lululemon’s valuation has already been steadily compressing for years. While it was once one of retail’s richly valued stocks, investors have been questioning whether the company can return to the double-digit growth era.

The results also arrive during a leadership transition. Lululemon announced back in April that former Nike executive Heidi O’Neill is set to take over as CEO in September, with investors looking to her to revive growth in North America and restore the brand’s growth.

As Lululemon faces both macroeconomic pressure and brand-specific challenges, its stock has dropped around 40% year to date.

markets
Paige Oamek

US job growth skyrocketed in May, blasting past expectations

The US economy added 172,000 jobs in the month of May, the Bureau of Labor Statistics reported Friday, sending 10-year Treasury yields higher.

The strong May job market surprised economists. Experts had predicted only 85,000 new jobs — just half the reported number. The unemployment rate held steady at 4.3%, as expected.

The job growth story is a hopeful spot for the economy as consumers continue to feel inflationary pressure from the Iran war.

Job gains were buoyed by the leisure and hospitality sector, which added 70,000 jobs, as well as local government, healthcare, and education.

Both the March and April jobs reports were revised upward, making them collectively 93,000 higher than previously reported.

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