Portfolio in Brief—D-Wave Quantum
D-Wave Quantum is a company specializing in quantumcomputing, a technology that remains young, but could transform certainsegments of the economy over the coming years. Unlike a mature technologycompany that is primarily assessed on its current profits, D-Wave representsmore of an exposure to a long-term trend: the gradual commercialization ofquantum computing.
Quantum computing aims to solve highly complex problems thattraditional computers struggle to handle, particularly in optimization,logistics, materials, finance, defence, cybersecurity and artificialintelligence. The market is still in its early stages, but its potential isattracting increasing attention from governments, large technology companiesand institutional investors.
D-Wave stands out in this space because it is not only aresearch company. It already generates revenue, sells quantum systems, offerscloud-based access to its technology and works with commercial, government andinstitutional clients. The company is pursuing a two-platform approach,combining quantum annealing and gate-model systems, which could allow it toaddress different types of problems as the market evolves.
Highlights in 2025-2026
· Revenue growth. In 2025, D-Wave generatedUS$24.6 million in revenue, up 179% from the prior year. The company alsoposted a GAAP gross margin of 82.6%, showing that recognized revenue cangenerate attractive gross profitability, even though the company remains farfrom net profitability.
· Improving order book. Commercial bookingsreached US$13.4 million in the fourth quarter of 2025, a sharp increasefrom the previous quarter. After year-end, D-Wave had already announced morethan US$32.8 million in new bookings for 2026, including a US$20 millionsystem sale to Florida Atlantic University and a US$10 million, two-yearcloud agreement with a Fortune 100 company.
· More diversified customer base. In 2025,D-Wave recognized revenue from more than 135 individual customers, includingmore than 70 commercial organizations and over two dozen Forbes Global 2000companies. This is an important point to monitor, as the real test for thequantum sector will be the ability to convert pilot projects into recurringcontracts and more predictable revenue.
· Stronger balance sheet. The company ended2025 with US$884.5 million in cash, cash equivalents and marketablesecurities, a record level for D-Wave. For a company still investing heavily inresearch, product development and commercialization, this financial positiongives it time to execute its strategy.
· Technological progress. The acquisitionof Quantum Circuits adds expertise in error-corrected gate-model quantumsystems. This transaction broadens D-Wave’s technology platform and could allowthe company, over time, to address a larger market than quantum optimizationalone.
· Stock performance. From a marketstandpoint, D-Wave remains an extremely volatile stock. Despite being downroughly 26% since the beginning of 2026, the stock is still up more than 160%over one year. It also rebounded sharply from the beginning of April, gainingmore than 40%, before facing profit taking in recent sessions. This performanceillustrates the nature of the stock: a high-potential innovation story, but onewhere short-term moves can be significant.
Why This Is a Stock to Watch
D-Wave should be viewed through a long-term lens. Itspotential does not rest on the next quarter’s results, but rather on thepossibility that quantum computing eventually becomes a new essential layer ofglobal technology infrastructure.
Today, commercial applications for quantum computing remainlimited. However, several industries are beginning to explore the technology tosolve complex optimization problems, improve certain simulation models,accelerate scientific research or support more advanced artificial intelligencesystems. If these applications move from the experimental phase to operationaluse, companies capable of delivering concrete solutions could benefit from arapidly expanding market.
D-Wave’s appeal lies in the fact that it is already tryingto bridge the gap between research and commercial use. Its system sales, cloudagreements, customer base and use cases show that the company is not relyingsolely on a future promise. It is looking to build real adoption today, whiledeveloping the technologies needed to expand its market in the years ahead.
For portfolios, this type of stock must be approached withdiscipline. D-Wave is not a defensive position or a mature company. It is aninnovation stock, sensitive to growth expectations, interest-rate movements,technology-stock volatility and investors’ appetite for emerging themes.Patience is therefore essential.
Risks to Keep in Mind
The main risk remains profitability. D-Wave reported a netloss of US$355.1 million in 2025. Even though a significant portion ofthat loss is tied to non-cash items, the company continues to invest heavilyand will need to prove that it can convert bookings and customer projects intolarger and more recurring revenue.
Valuation is also a key point to monitor. Like many stockstied to disruptive technologies, the market values D-Wave more on its futurepotential than on current earnings. This can lead to large moves in the stock,both up and down, depending on commercial updates, technology announcements orshifts in market sentiment toward the sector.
Finally, the adoption timeline for quantum computing remainsuncertain. The potential is substantial, but it could take several years beforethe technology is widely used by businesses. D-Wave’s success will thereforedepend on its ability to maintain its technological lead, earn the trust oflarge customers and demonstrate measurable economic value.
Conclusion
D-Wave Quantum offers direct exposure to one of the mostpromising, but also one of the most speculative, technology themes of thecoming years. Quantum computing is still in its early stages, but it couldeventually play an important role in optimization, defence, finance, materials,cybersecurity and artificial intelligence.
What makes D-Wave interesting is that it is not limited to atheoretical vision. The company already generates revenue, has a growingcustomer base, holds a significant liquidity position and is pursuing a broadertechnology strategy through its two-platform approach.
The stock’s recent performance is also a reminder of theimportance of a disciplined approach. D-Wave has risen sharply over one year,but remains down since the beginning of 2026, illustrating the naturalvolatility of stocks tied to emerging technologies. This type of investmenttherefore requires a long-term view, tolerance for fluctuations and a rigorousanalysis of commercial progress.
In short, we see D-Wave as a multi-year innovation stock.The long-term potential is significant, but it must be paired with disciplinedrisk management. This is not a stock to buy for its current earnings, butrather one to watch for what it could become if quantum computing graduallymoves from experimentation to real commercial adoption.
Market Brief
Monday
Dow Jones: -0.01% at 49,442.56
S&P 500:-0.24% at 7,109:14
Nasdaq: -0.26% at 24,404.39
S&P/TSX: +0.04% at 34,360.03
Canadian Dollar
The Canadian dollar closed at US$0.7321, slightly higher onthe session. The loonie held up better than expected in a cautious marketenvironment, supported by the relative resilience of Canadian equities and therebound in resource-related sectors.
Monday’s session marked a pause after the strong rally ofrecent days. Markets shifted to a more cautious tone as renewed tensionsbetween the United States and Iran brought oil back to the centre of the macropicture. If the Strait of Hormuz remains a source of uncertainty, investors areless willing to aggressively extend the rally.
Oil moved sharply higher, with WTI up 6.87% to US$89.61 andBrent up 5.64% to US$95.48. This rapid reversal following Friday pullback wasanother reminder of how sensitive markets remain to any threat involving globalenergy supply. When crude rises that quickly, inflation concerns re-emergealmost immediately and complicate the rate outlook.
On the bond side, the U.S. 10-year Treasury yieldremained around 4.26% to 4.27%, a level that continues to limit multipleexpansion, especially in growth stocks. This was not a panic signal, but rathera reminder that markets are still dealing with elevated rates in a fragile geopoliticalenvironment.
Despite the modest decline in the S&P 500 andNasdaq, the overall tone remained relatively orderly. The Russell 2000still managed to advance, showing that risk appetite has not disappeared, buthas become more selective. In other words, Monday looked more like a pause thana reversal in the trend.
In Canada, the TSX held up better thanks to its heavierexposure to commodities. In this type of environment, the Canadian marketgenerally benefits from a better cushion when energy and resource sectorsregain momentum.
Stocks in Brief
· Marvell Technology (MRVL): +5.83%—thestock advanced after reports that the company is in discussions with Google todevelop new artificial intelligence chips.
· Stanley Black & Decker (SWK): +5.30%—investorsreacted positively after the company maintained its full-year outlook despitenew tariffs on certain metals.
· USA Rare Earth: +13.18%—strong movefollowing the announcement of the acquisition of Serra Verde in a transactionworth roughly US$2.8 billion.
· Broadcom (AVGO): -1.70%—slight pullbackin a more selective market, despite continued strong interest in the AI theme.
· Airlines and cruise lines: lower—stocksmore sensitive to fuel costs came under pressure as oil moved sharply higher.
Sector Performance
In the United States, the session was more selective. Growthsegments were somewhat more cautious as oil prices rose and bond yields stayedelevated, while some more domestic areas held up better.
In Canada, the TSX once again benefited from its structuralexposure to commodities. The rebound in energy and the better resilience ofresource sectors helped Toronto finish slightly higher even as Wall Streetpulled back.
Tuesday
Dow Jones: -0.59% at 49,149.38
S&P 500:-0.63% at 7,064:01
Nasdaq: -0.59% at 24,259.96
S&P/TSX: -1.61% at 33,808.30.
North American markets started the day on solid footing, butsentiment deteriorated steadily as the deadline for the U.S.-Iran ceasefireapproached.
Canadian Dollar
The Canadian dollar closed at US$0.7324, slightly higherthan Monday. The move remained modest as rising oil prices supported the U.S.dollar through inflation expectations and higher bond yields.
Tuesday’s session was driven by a clear reversal in marketsentiment. U.S. indexes opened higher, but optimism faded throughout the day asinvestors began to question whether a quick agreement between Washington andTehran was still realistic. The cancellation of J. D. Vance’s trip toPakistan for negotiations added to the nervousness, and markets finished on aweaker note ahead of Wednesday’s ceasefire deadline.
Oil once again became the main macro driver of the session.After briefly moving lower earlier in the day on hopes of a deal, crudereversed course. WTI finished around US$92.13, while Brent settled at US$98.48,up 3.14%. On the Canadian side, June crude closed at US$89.67, while Brentswung from below US$95 to nearly US$100 during the session. The market messageremained the same: as long as the Strait of Hormuz remains at the centre ofconcern, oil will continue to have a direct grip on broader market sentiment.
This rebound in crude revived inflation concerns. Whenenergy prices move back up, investors immediately reassess how much roomcentral banks have to ease policy quickly. That is what weighed on the indexes,especially after several sessions of record highs. Tuesday therefore felt likea day of risk repricing: the market is not capitulating, but it is becomingmuch less generous on valuations when the geopolitical backdrop threatens topush energy prices higher again.
Sector breadth was also weaker. Eight of the eleven S&P 500sectors finished in the red. Utilities and real estate led the declines, whileenergy, information technology, and consumer discretionary held up better. Thatdispersion matters because it shows this was not simply a broad and uniformselloff, but rather a rotation in which some oil-linked and growth-relatedareas held up better than the more rate-sensitive pockets of the market.
In Canada, the TSX decline was much sharper than in theUnited States. Weakness in base metals and precious metals weighed heavily onthe Toronto index. Gold fell US$109.20 to US$4,719.60 an ounce, adding anotherlayer of pressure on the resource complex. In other words, Tuesday was not onlya session shaped by geopolitical caution; in Canada, it also took the form of ameaningful correction in non-energy commodity segments.
Another point worth watching was U.S. consumer spending.March retail sales rose 1.7%, above expectations, but much of that strengthcame from gas stations, where receipts jumped 15.5% because of higher prices atthe pump. That is not necessarily a sign of broader demand strength; it alsoreflects a consumer paying more for energy. That distinction matters, becauseit shows how higher oil prices can lift headline economic data in nominal termswhile still squeezing real purchasing power.
Stocks in Brief
• UnitedHealth (UNH): +7.0%—first-quarter resultscame in above expectations, and the company raised its full-year outlook,helping limit broader market losses.
• Amazon (AMZN): +0.7%—shares moved higher after theannouncement of an expanded deal with Anthropic, including a commitment of morethan US$100 billion over ten years in AWS technologies.
• Apple (AAPL): -2.5%—the stock weighed heavily onthe S&P 500 after Tim Cook announced he would step down as CEO on September1, with John Ternus set to succeed him.
• Intel (INTC)—the stock benefited from an upgrade byHSBC, which sees additional upside tied to server CPU demand and operationalrecovery.
Sector Performance
In the United States, the session reflected a more defensivemarket tone, though not a disorderly one. Energy held up better thanks to therebound in oil, while information technology limited the damage. By contrast,utilities, real estate, industrials, and materials were more affected by risinggeopolitical risk and rate repositioning.
In Canada, weakness was more pronounced. The pullback inbase metals and the drop in gold dragged the TSX lower despite firmer oilprices. That made for a much heavier session in Toronto than in New York.
Tesla: The Market Now Wants More Than Promises
Tesla delivered a quarter that looked decent on the surface,but not strong enough to eliminate doubts. In the first quarter of 2026, thecompany posted adjusted earnings of US$0.41 per share, above expectations, onrevenue of US$22.39 billion, slightly below consensus. The key issue isthat the market is no longer looking only at quarterly earnings. It now wantsmore concrete proof that the next phase of growth, tied to autonomy, robotaxisand Optimus, is taking shape.
That matters even more because the stock has clearlyunderperformed in 2026. Before earnings, the shares were down about 14% year todate, making Tesla one of the weakest performers among major U.S. technologycompanies. That weak stock performance reflects the current skepticism well.Tesla is still valued like a disruptive technology company, while its corebusiness still depends largely on selling electric vehicles, a segment wheregrowth has become much more demanding.
The delivery numbers highlight that pressure. Tesladelivered 358,023 vehicles in the first quarter, below market expectations,while competition continues to intensify, especially in China. The company isfacing rivals that are more aggressive on pricing, faster in refreshing theirproduct lineup and, in some cases, better positioned in certain markets. Thefact that BYD overtook Tesla in global battery electric vehicle sales in 2025shows clearly that its historical leadership is no longer untouchable.
There are still some more encouraging elements. Teslaimproved its automotive gross margin excluding regulatory credits to 19.2%,which points to better cost control and some relief on input costs. Managementis also continuing to push ahead with its major projects, including Cybercab,the Semi truck, the Optimus factory and artificial intelligence across itsplatforms.
The challenge is that all of this requires a tremendousamount of capital. Capital expenditures jumped to US$2.49 billion in thequarter, and the company now expects to invest more than US$25 billionthis year. In market terms, that means one simple thing: Tesla is stillinvesting heavily in the future, but investors now want to see that futureshowing up more clearly in the numbers.
In short, Tesla remains a unique stock, but a more complexone than before. The upside remains considerable if autonomy and roboticsbecome real business drivers. Until then, the market seems to have changed itsstance. It is no longer enough to tell a compelling story. Tesla now has toshow that the story can truly support the valuation.
Thursday
S&P/TSX: 33,912.93 (-0.12%, -42.18 points)
Dow Jones: 49,310.32 (-0.36%, -179.71 points)
S&P 500:7,108.40 (-0.41%)
Nasdaq: 24,438.50 (-0.89%)
Canadian Dollar
The Canadian dollar edged lower, trading at 73.06 US cents,compared with 73.20 US cents on Wednesday.
Thursday’s session brought a bit of caution back to themarkets, after the S&P 500 and Nasdaq reached records the previousday. The pullback remained orderly, but it showed that investors remainsensitive to geopolitical developments, especially when they directly affectoil and the Strait of Hormuz.
The main source of pressure came from the Middle East. Theceasefire between the United States and Iran is still holding, but uncertaintyaround the Strait of Hormuz continues to fuel oil volatility. Brent finishedabove US$105 per barrel, after briefly topping US$107, while WTI rose toUS$95.85. For markets, higher oil means a more persistent inflation risk,heavier costs for several companies and less room for central banks tomaneuver.
This rebound in oil also pushed the U.S. 10-yearTreasury yield toward 4.32%, compared with 4.30% the previous day. The move isnot major, but it comes after a strong rebound in growth stocks. In thatcontext, investors used the oil-related nervousness and some more mixedearnings results as an opportunity to take profits.
The software sector weighed heavily on the Nasdaq. Even whenresults were above expectations, markets were more demanding on the quality ofgrowth, the outlook and the potential impact of artificial intelligence onbusiness models. The session shows that investors no longer automaticallyreward companies that beat expectations: they also want a clear path for thecoming quarters.
On the economic side, new jobless claims reached 214,000,slightly above expectations, but they remain low by historical standards.Preliminary S&P Global data also showed stronger-than-expected activity,with the manufacturing index at 54.0 and the services index at 51.3.
In short, the U.S. economy continues to hold up, but themarket is caught between two forces. On one hand, corporate earnings remaingenerally decent. On the other, higher oil, rising yields and geopoliticaluncertainty are limiting risk appetite, especially after several solidsessions.
Stocks in Brief
· Texas Instruments (TXN): +19.43%—stronggain after better-than-expected results and earnings guidance well aboveexpectations for the current quarter. The stock was the main support for theS&P 500.
· ServiceNow (NOW): -17.75%—sharp dropdespite results that were broadly in line with expectations. Investors focusedmainly on subscription revenue growth and comments related to Middle Eastheadwinds.
· IBM (IBM): -8.25% — marked pullbackdespite better-than-expected results. The unchanged full-year guidancedisappointed investors, who were hoping for an upward revision.
· Tesla (TSLA): -3.56%—decline despiteresults above expectations. The market focused instead on the sharp increaseexpected in capital expenditures, particularly to fund factories tied to robotsand other new products.
· Microsoft (MSFT): about -4%—pressure inthe software sector, in a context of profit taking and questions about theability of large platforms to maintain their pace of growth.
· Palantir (PLTR): more than -7%—declinealongside weakness in software and AI-related stocks, after their strong recentrebound.
· Oracle (ORCL): about -6%—fell with thebroader enterprise software group, as investors reassessed valuations afterseveral positive sessions.
· Adobe (ADBE): -6.63%—dragged down bysoftware weakness, in a market that has become more selective toward growthstocks.
· American Airlines (AAL): +2.4%—rose afterbetter-than-expected results. However, the company lowered its annual outlookbecause of higher fuel costs.
· Southwest Airlines (LUV): -4.1%—declinedafter results came in below expectations and visibility became more limited ina higher energy-cost environment.
· Penn Entertainment (PENN): +16.86%—stronggain after quarterly results came in above expectations, supported by strengthin regional casinos and the interactive segment.
Sector Performance
In the United States, the pressure came mainly fromtechnology, especially software. Declines in ServiceNow, IBM, Microsoft,Palantir, Oracle and Adobe weighed on the Nasdaq. The sector remains at thecentre of the 2026 rebound, but Thursday’s session was a reminder that highvaluations leave little room for error when outlooks disappoint.
Energy held up better thanks to the rebound in oil. However,more expensive crude remains a risk for the overall market, since it can reviveinflationary pressures and reduce consumers’ purchasing power.
Airlines were mixed. American Airlines advanced onbetter-than-expected results, while Southwest declined, weighed down by weakernumbers and higher fuel costs.
Semiconductors were more mixed. Texas Instruments jumpedsharply after its results and outlook, but that gain was not enough to offsetthe broad weakness in software.
In Canada, the S&P/TSX finished slightly lower. Thepullback was much more moderate than on the Nasdaq, reflecting the Canadian marketmore defensive composition and its exposure to natural resources. The sessionremained cautious, but without a real breakdown.
Weekly Conclusion
The week is ending with a market that looks stronger than itmay seem at first glance. Major indexes saw some profit taking after reachingnew highs, but the overall tone remains constructive. Investors remain cautiousbecause of the Middle East and oil, but they are not leaving the market.Instead, they are moving toward sectors where earnings growth remains the most visible,especially semiconductors and technology infrastructure.
Oil was the main source of nervousness. Tensions around theStrait of Hormuz pushed Brent crude back above US$100 per barrel, revivinginflation concerns and complicating the job of central banks. However, hopesthat talks between Washington and Tehran could resume helped ease some of thepressure late in the week. Markets know that a lasting improvement on theenergy front could quickly improve sentiment, since more stable oil wouldreduce pressure on costs, rates and corporate margins.
Market leadership remains very concentrated. Technologycontinues to support the indexes, but semiconductors are clearly leading theway. Intel rebounded sharply after better-than-expected results, TexasInstruments also surprised positively, and the chip sector extended its winningstreak. This confirms that investors are still willing to pay for visiblegrowth, especially when it is tied to artificial intelligence, data centres anddemand for computing capacity.
At the same time, the week also showed that markets arebecoming more selective. Software stocks came under pressure after results fromServiceNow, IBM, Microsoft, Oracle and Adobe, showing that investors are nolonger rewarding revenue or earnings beats alone. They also want clearguidance, durable growth and proof that artificial intelligence is trulyimproving business models rather than threatening them.
In Canada, the TSX held up better thanks to its moredefensive composition and exposure to natural resources. In an environmentwhere oil, gold and rates remain central to the market narrative thatcomposition offers some cushion. The Canadian dollar remained relativelystable, reflecting a market that is still cautious, but not in panic mode.
In short, the week was marked by a market taking a pause,not a market breaking down. Geopolitical risks remain very present, butcorporate earnings, semiconductor strength and the resilience of the economycontinue to support the indexes. If diplomatic talks progress and pressure onoil eases, markets could quickly regain a more favourable tone. For now,discipline remains important, but the backdrop is still constructive forportfolios well positioned in quality sectors, with tight risk management.
