What’s Next For Quantum Computing Inc. After A 3,000% Rise
Quantum Computing Inc. (NASDAQ: QUBT), a company developing quantum-compatible chips and photonic hardware for high-performance computing, AI, and cybersecurity, has seen its stock soar 80% over the past month and over 3,000% in the last year. This remarkable surge reflects growing interest in the transformative potential of quantum technology. The rally gained momentum after Nvidia CEO Jensen Huang stated at the GTC Paris developer conference that “quantum computing is reaching an inflection point.”
Unlike classical computers that use binary bits (0s and 1s), quantum computers rely on “qubits,” which can represent multiple states simultaneously. This enables quantum systems to perform complex calculations and evaluate numerous possibilities in parallel—beneficial for use cases like financial modeling, drug discovery, and materials research.
However, quantum computing still faces significant hurdles. As qubit count rises, error rates tend to increase, making large-scale quantum systems challenging to manage. These issues, while common for emerging technologies, have not halted progress. Leading players like Google, IBM, and D-Wave have developed scalable systems with dozens of qubits, marking a crucial step toward real-world applications.
IBM stands out in the field, having introduced its 1,121-qubit Condor processor and setting its sights on building 100,000-qubit systems by 2033. Quantum Computing Inc. (QCi) has also made strides, unveiling its Dirac 3 quantum system tailored for solving complex optimization problems. The Dirac system is notable for being the first to solve integer problems using quantum digits (qdits) instead of qubits. Each qdit supports 200 discrete modes, representing a significant evolution beyond traditional qubit systems.
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QCi’s Approach and Offerings
QCi takes a unique path compared to D-Wave’s quantum annealing and conventional gate-model quantum systems. The company focuses on photonics and quantum optics, developing quantum machines that run at room temperature and use minimal power—all at a lower cost.
This room-temperature capability is a key differentiator from the ultra-cold superconducting systems used by D-Wave, IBM, and Google. QCi’s photonic method avoids the need for cryogenic cooling, potentially making quantum hardware more practical and scalable.
Central to QCi’s innovation is its thin-film lithium niobate (TFLN) photonic chip foundry in Tempe, Arizona, which began operations last month. The facility is producing photonic computing components using this advanced material to support integrated photonic systems. The company has already secured multiple purchase orders under its 2024 Pilot Launch Program.
Investment Outlook and Risks
Although quantum computing offers enormous potential, the technology is still in its early stages and is not yet widely adopted. QCi’s revenue over the past year was just $385K, while its operating loss reached $28 million.
QUBT stock tends to experience sharp swings and is highly sensitive to market conditions. For instance, during the 2022 inflation shock, it declined 93% compared to the S&P 500’s 25% drop. Similarly, it plunged 73% during the COVID-19 market crash, while the S&P 500 fell 34%. These declines underscore the risks tied to QUBT’s volatility.
Like many quantum stocks, QUBT is a speculative investment with significant growth potential. Its outlook hinges on continuous innovation and cost management. If QCi successfully sells its photonic chips at scale, its stock could rise further.
Investing in QUBT is essentially a bet on the long-term promise of quantum computing and QCi’s ability to carve out a significant role in that future. The company already serves major clients such as NASA and Johns Hopkins and is working to make quantum machines more accessible and affordable.
QUBT stock has displayed considerable volatility over the years. Annual returns were -49% in 2019, -46% in 2020, 110% in 2021, -56% in 2022, -40% in 2023, and an astonishing 1713% in 2024. In contrast, the Trefis High Quality (HQ) Portfolio, consisting of 30 stocks, has shown far less volatility and has clearly outperformed the S&P 500 over the past four years. Why is that? HQ Portfolio stocks tend to deliver stronger returns with reduced risk, offering a smoother investment journey, as highlighted by HQ Portfolio performance metrics.
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