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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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Luke Kawa

BlackBerry is on one of its hottest rallies of all time

History suggests that BlackBerry does extremely well when 1) it’s considered to be pioneering a transformative technology, or 2) there’s widespread retail enthusiasm for stocks.

If you squint (or dream), you could argue that both are going on right now.

Shares of the once-upon-a-time smartphone giant are up more than 160% over the past three months. The only times the shares have had a hotter run of form than this are at the tail end of the dot-com bubble, and in early 2021 when was it part of the meme stock craze headlined by GameStop.

Let’s start with the easy part first — here’s Scott Rubner, head of equity and equity derivatives strategy at Citadel, on retail’s significant footprint in the shares’ rally:

“Retail traders are the new price setters in the market. May volumes across our retail cash equities and options platforms are currently tracking at record levels. Daily volumes on our cash platform are setting new highs and are on pace to finish nearly ~10% above the previous record established during the January 2021 meme-stock era.”

And then there’s the harder part, part of the story that the traders bidding up BlackBerry now are dreaming about: the QNX division, which offers software that the company is positioning as an operating system for robots.

QNX’s software has early uptake in the field of autonomous driving, with BlackBerry eyeing a much more widespread role: in April, it announced a partnership to deploy this technology on Nvidia’s robotics platform. Nvidia’s Jensen Huang, for his part, has long been calling for agentic AI adoption to be followed by physical AI (i.e., robots).

In a QNX press release unveiling a report this week, the company argued that software, not hardware, is the real problem in terms of making sure robotics works.

I supposed it would be poetic, in a way, if the company at the leading edge of the smartphone revolution also plays a big role in the proliferation of robotics.

markets
Luke Kawa

Micron and Sandisk rally on new Street-high price targets from Susquehanna

Micron and Sandisk both hit fresh all-time highs in early trading after Susquehanna bestowed new Wall Street-high price targets on the two memory stocks.

Analyst Mehdi Hosseini upped his view on the former to $1,750 from $600, and to $3,250 from $2,000 for the latter.

“Supply is now expected to remain tight through 2027, sustaining elevated margins and thus warranting valuation re-rating,” he wrote, per Bloomberg.

It’s the fifth time in the past year that the average price target on Micron has gone up by more than 10% in a week. UBS’s Tim Arcuri more than tripled his price target on Micron earlier this week, and has already lost the title of “most bullish.”

But even as analysts are tripping over themselves to raise their price targets on these stocks, the ferocity of the rally in Micron has outpaced their best efforts.

The high-bandwidth memory specialist traded at a record premium to the consensus Wall Street price target this week, based on data going back to 2008.

markets
Helena Cheng

Okta soars on Q1 earnings beat, raised outlook driven by AI security demand

Okta shares are surging in early trading Friday after the identity security provider posted Q1 fiscal 2027 financial results that exceeded Wall Street estimates. The strong results are fueled by accelerating corporate demand for cybersecurity software, as well as the deployment of autonomous AI systems.

Key numbers:

  • Adjusted earnings per share of $0.91 compared to analysts’ estimate of $0.85.

  • Revenue of $765 million compared to an estimate of $752.7 million.

The company generated subscription revenue of $750 million, up 11% year over year. Okta also has $271 million in free cash flow, up from $238 million in the prior year’s quarter.

While standard cybersecurity software protects human workers, the latest catalyst sparking Okta’s strong corporate performance is the rapid emergence of autonomous AI agents that can access sensitive corporate databases and interact with privileged executive accounts.

“AI agents are rapidly becoming a new workforce inside every organization, creating a wave of identities that must be secured and governed alongside human users,” said Todd McKinnon, CEO and cofounder of Okta. “We’re expanding our opportunity as the world’s leading independent and neutral identity provider and helping customers make identity the unified control plane for their secure agentic enterprise.”

Okta raised its fiscal 2027 revenue guidance to between $3.185 billion and $3.205 billion, roughly in line with estimates of $3.18 billion. The company formally dropped its long-term projected non-GAAP tax rate from 26% down to 21%. This adjustment is a direct byproduct of the federal corporate tax frameworks under the One Big Beautiful Bill Act.

Shares of Okta have risen around 9% since the beginning of this year.

markets
Helena Cheng

HPE, SMCI surge after Dell’s Q1 beat on strong AI server demand

HP Enterprise and Super Micro Computer shares are surging in premarket trading, getting a big boost from rival Dell’s strong Q1 results.

Dell’s $16.1 billion in AI-optimized server sales for the quarter alone proved that enterprise data center demand is accelerating faster than Wall Street had anticipated. The company posted revenue of $43.8 billion, exceeding Street estimates of $35.5 billion. Management now sees full-year sales of about $167 billion, well above the $142 billion expected by analysts.

The read-through is particularly relevant for Super Micro, one of the largest suppliers of Nvidia-powered AI server systems, and HPE, which has been expanding its AI infrastructure and liquid-cooling offerings through its partnership with Nvidia.

The moves suggest investors view AI infrastructure as a broad spending cycle that benefits server makers across the entire ecosystem.

markets
Claire Yubin Oh

AST SpaceMobile plummets after Blue Origin rocket explosion

Shares of AST SpaceMobile plunged as much as 15% before the bell on Friday after a Blue Origin rocket exploded yesterday evening on the launchpad.

The New Glenn rocket blew up in what the Jeff Bezos-backed company described on X as “an anomaly” during a hotfire test at the launchpad, only days before it’s due to launch satellites for Amazon’s Project Kuiper next week. Bezos added via X that “it’s too early to know the root cause but we’re already working to find it.” Videos of the explosion circulating on social media show an enormous fireball.

Blue Origins' New Glenn rocket just exploded on the pad.
byu/Ph6222 inaviation

Though AST SpaceMobile’s satellites are not directly affected by the latest explosion, the company partnered with Blue Origin in November 2024 to use its New Glenn rocket to deliver AST’s next-generation Block 2 Bluebird satellites to low-Earth orbit. Citing multiple unidentified employees, the Financial Times reported that an initial assessment of the site showed severe damage to Blue Origin’s equipment, including its only launchpad.

The explosion is a stumbling block for AST’s goals to place at least 45 satellites in orbit by the end of the year. The journey to reach that goal already hit a pretty major speed bump in April, after Blue Origin reported that its New Glenn vehicle put AST SpaceMobile’s BlueBird 7 satellite at an altitude too low to maintain operations.

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