Xanadu (XNDU) Q3 2026 Earnings Call Transcript

Image source: The Motley Fool.

DATE

Wed, Nov. 11, 2026

CALL PARTICIPANTS

• Founder and Chief Executive Officer – Dr. Christian Weedbrook
• Chief Financial Officer – Michael Trzupek
• Chief Operating Officer – Rafal Janik
• VP, Investor Relations – Brett Harriss

Need a quote from a Motley Fool analyst? Email [email protected]

TAKEAWAYS

• Revenue — $1.3 million, reflecting timing variations in contract work and partnership revenue compared to $1.5 million in the second quarter.
• Net Loss — $32.2 million, representing an improvement from a $42.1 million loss in the second quarter due to the settlement of earn-out share liabilities.
• R&D Expense — $25.6 million, increasing $5.9 million from the previous quarter driven by higher wafer consumption and engineering headcount expansion.
• G&A Expense — $9.2 million, decreasing from $11.1 million in the second quarter as professional fees for regulatory transactions subsided.
• Adjusted EBITDA Loss — $26.3 million, widening from $21.3 million in the second quarter because of increased investments in chip development and subsystems.
• Capital Expenditures — $8.4 million, reflecting investments in specialized testing equipment and the development of a new advanced photonics facility.
• Cash Position — $286.5 million, providing liquidity to fund technical road map objectives and operational activities.
• ATM Facility — $232.8 million in remaining availability, following a $67.2 million capital raise during the second quarter.
• Headcount — 361 employees, up from 306 at the end of the second quarter to support hardware and software engineering growth.
• Optical Switch Loss — 7 milli-dB, establishing a world record for electro-optic switches and improving from 20 milli-dB reported last year.
• On-Chip Homodyne Detector Loss — 77 milli-dB, achieving a twofold reduction in loss since the previous year.
• Fiber Delay Line Loss — more than threefold reduction since the start of the year, enhancing the efficiency of the quantum memory subsystem.
• Logical Qubit Targets — 200 qubits by 2029 and 500 qubits by 2030, supported by targeted error rates as low as 10 to the minus 16.
• PennyLane Adoption — 1.1 million package installs per month, with approximately 30% of quantum developers utilizing the platform in the past year.
• Federal Funding — $140 million, awarded by the Government of Canada to support the Inception facility through Project OPTIMISM.
• DARPA Project Funding — up to $10 million, granted as a provisional contract extension under the Quantum Benchmarking Initiative.
• Lithium Niobate Wafer Runs — 15% sequential increase, accelerating iterative design cycles through more frequent chip fabrication.
• Backline Processing Latency — under 3 microseconds, demonstrating the ability to perform real-time error correction using standard classical hardware.

SUMMARY

Xanadu Quantum Technologies Limited (XNDU +0.72%) is prioritizing its long-term technical road map to achieve fault-tolerant quantum computing by 2029, focusing on iterative engineering milestones rather than near-term revenue. Management reported significant progress in reducing optical loss across key hardware components and launched a new integration platform in collaboration with AMD to support real-time error correction. The company is scaling its manufacturing capabilities through strategic partnerships with semiconductor leaders and the construction of a new advanced photonics facility in Toronto. While software revenue remains at an early stage, the company stated it is seeing growing demand for enterprise training and hardware-readiness applications from industrial partners. CFO Trzupek indicated that the company will continue to increase research and development investments to support accelerated chip fabrication cycles and engineering headcount growth.

• Janik stated that the company utilized agentic AI to achieve a discovery in 2 weeks that would typically require more than 6 months of manual labor.
• Janik noted that the company’s digital twin of its system allows algorithm developments to propagate directly into resource estimates and logical architecture assessments.
• CEO Weedbrook explained that the transition to SNSPD detectors allows for a faster computer and a reduced physical footprint compared to previous designs.
• Janik reported that major financial and consulting institutions are utilizing PennyLane to build internal quantum expertise and establish business cases for future hardware readiness.
• Janik stated that the new Inception facility will provide heterogeneous integration capabilities for silicon nitride and lithium niobate that are not currently accessible at the same quality level elsewhere.
• Weedbrook stated, “We expect ASML’s expertise in advanced lithography to help us reduce waveguide loss, which is the #1 cause of optical loss of our integrated photonic circuits.”

INDUSTRY GLOSSARY

• PennyLane: An open source software framework for differentiable quantum programming and machine learning.
• GKP Qubits: Gottesman-Kitaev-Preskill qubits, a method of encoding quantum information to enable error correction.
• Fault Tolerance: The ability of a quantum computer to perform computations correctly even when individual components or operations fail.
• SNSPDs: Superconducting Nanowire Single Photon Detectors, high-speed devices used to detect individual particles of light.
• EUV Lithography: Extreme ultraviolet lithography, an advanced manufacturing process used to create high-precision semiconductor chips.
• Wafer Tape-Out: The final stage of the design process for integrated circuits before the design is sent for fabrication on a semiconductor wafer.
• Homodyne Detector: A device used in photonic quantum computing to extract the results of quantum algorithms.

Full Conference Call Transcript

Operator: Thank you for standing by. My name is Jordan, and I’ll be your conference operator today. At this time, I’d like to welcome everyone to the Xanadu Quantum Technologies Q3 2026 Earnings Conference Call. [Operator Instructions] I would now like to turn the call over to Brett Harriss, VP, Investor Relations. Please go ahead.

Brett Harriss: Thank you. Good afternoon, everyone. Welcome to Xanadu’s Third Quarter Earnings Conference Call. Joining me today are Dr. Christian Weedbrook, Founder and Chief Executive Officer; Michael Trzupek, Chief Financial Officer; and Rafal Janik, our Chief Operating Officer. This call is being webcast live and will be made available on Xanadu’s Investor Relations website. This call contains time-sensitive information accurate only as of the date of this live webcast on this call, November 11, 2026. This call may include forward-looking statements and information, which are based on current expectations. These expectations and information are subject to significant risks and uncertainties, and actual results may differ materially from the conclusions, forecasts or

Source: www.fool.com — article syndicated from the publisher’s feed; all rights remain with the original publisher.