It’s been a wild 24 hours for the stock prices of America’s “big four” publicly traded quantum computing companies, which include D-Wave, IonQ, Quantum Computing Inc., and Rigetti.
Yesterday, all four quantum firms saw their stock prices fall significantly along with a broader market selloff—mostly related to fears about a growing trade war with China and disappointing tech earnings.
But today, shares of the Quantum Four are up on the rumors that the Trump administration is interested in taking an equity stake in quantum computing firms. Here’s what you need to know.
Commerce Department reportedly interested
Last night, the Wall Street Journal reported that the U.S. Commerce Department was in talks with “several” quantum computing companies over equity stakes in those firms in return for federal funding.
Specifically, the Journal said D-Wave, IonQ, and Rigetti were in discussions with the federal government about the matter. The report stated that Quantum Computing Inc. and the privately held Atom Computing were “considering similar arrangements.”
Fast Company has reached out to all the quantum firms named in the WSJ’s report. IonQ declined to comment. Others did not immediately reply.
The exact terms of any such deal are unknown. However, the report states that minimum federal government funding awards would be for $10 million each. It is unknown how much equity the U.S. government would want in exchange for funding, though the level of equity and the amount of funding will likely be correlated.
The funding would come from the Chips Research and Development Office, which is overseen by Commerce Secretary Howard Lutnick.
The Commerce Department did not immediately reply for comment.
The next frontier in computing
That the Trump administration is reportedly interested in an equity stake in America’s quantum computing firms is of little surprise. This past year alone, the administration has taken stakes in chipmaker Intel. and rare earths mining operator MP Materials.
The link between these two companies is that they produce products and materials—advanced chips and rare earth elements—that are seen as vital to America’s national security supply chain.
Intel’s chips power everything from navigation systems to military technology, and MP’s rare earths are needed to make the components that go into critical electronics used by the government and military.
Quantum computing differs in that, as of now, quantum computers don’t play a critical role in powering the tools behind U.S. economic, military, or security power. But that is expected to change in the years ahead as quantum computers advance and have the potential to be more revolutionary than even AI.
Quantum computers are different than the classical computers we use today.
A classical computer operates using bits, where each bit of data can either be a one or a zero. However, a quantum computer utilizes qubits, where each unit of data can represent a one and a zero—or anything in between—at the same time.
This means that quantum computers can carry out computation tasks in a matter of minutes or hours that would take a classical computer thousands of years or more to compute.
Given the potential for quantum computers to revolutionize everything from materials science to healthcare to communications and security, it’s no surprise that countries, including the United States and China, are deeply interested in the development of this technology.
‘Quantum Four’ stocks jump on Thursday
After the WSJ report broke, shares of the four publicly traded quantum computing companies spiked in premarket trading on Thursday morning. As of the time of this writing, all quantum four stocks are currently up significantly, including:
- D-Wave Quantum Inc. (NYSE: QBTS): up 13%
- IonQ, Inc. (NYSE: IONQ): up 12%
- Quantum Computing Inc. (Nasdaq: QUBT): up 11%
- Rigetti Computing, Inc. (Nasdaq: RGTI): up 9%
Today’s price jump helps wipe out much of the losses that the Quantum Four experienced yesterday amid a broader market selloff. Yesterday, D-Wave closed 15% lower, IonQ closed down 6%, Quantum Computing Inc. lost 7%, and Rigetti lost 9%.
Over the past 12 months, the stock prices of the Quantum Four have surged. As of yesterday’s close, D-Wave was up 2,174%, IonQ was up 269%, Quantum Computing Inc. was up 1,215%, and Rigetti was up 2,831%