Quantum Computing (QUBT) shares surged 12% in premarket trading Friday, a day after the provider of photonic and quantum optics technology swung to a profit on benefits from an earlier acquisition and growing demand for its thin film lithium niobate (TFLN) photonic chips.

The company posted first-quarter earnings of $17 million or $0.11 per share, compared with a loss of $6.4 million or $0.08 per share a year ago. Revenue rose to $39,000 from $27,000.ඣ 

Quantum Computing noted that the gain in net income was primarily because of "a $23.6 million non-cash gain on the mark-to-market valuation of the Company’s warrant liability as a result of our merger with QPhoton in June 2022."

Interim CEO Dr. Yuping Huang explained that during the period the firm finished construction of its Quantum Photonic Chip Foundry in Tempe, Ariz., and that it’s "encouraged by our early traction, which is the first step in what we believe is a significant, multi-year opportunity to serve the expanding markets in datacom, telecom, and quantum-enabled applications."

Huang added that Quantum Computing deepened its engagement with both government and commercial partners, "reinforcing the growing interest in our quantum and photonic machines and positioning QCi to capitalize on emerging opportunities ahead."

The news was in contrast with another quantum computing firm, Rigetti Computing (RGTI), which reported earlier this week that quarterly sales plunged.

Quantum Computing shares were down about 44% year-to-date entering Friday.