Better Quantum Computing Stock: IonQ vs. Quantum Computing, Inc.

Can IonQ outperform Quantum Computing, Inc. in 2025 and beyond? In this article, we will look at two prominent names in the rapidly growing quantum computing market.

Quantum computing has become a very exciting topic for investors and technology enthusiasts alike. Recently, three of the top four stocks that have shown remarkable gains within just six months are pure investments in this cutting-edge technology. The anticipated capabilities of these advanced computers, which aim to solve highly complex problems almost instantaneously, have captured the attention of many.

IonQ, a leading manufacturer of quantum computers, saw its stock price skyrocket by 484% as of December 26. However, it’s worth noting that this impressive increase doesn’t place IonQ in the top tier of performers; rather, it ranks 16th in terms of stock performance. This is significantly overshadowed by the astonishing 2,735% gain posted by its smaller competitor, Quantum Computing, Inc..

The question now is whether Quantum Computing can sustain its momentum. Alternatively, can IonQ reverse the trend and surpass the smaller company by 2025? As we delve deeper, we will explore what investors should consider before diving into this promising but volatile market.

Metric	Quantum Computing	IonQ
Market Cap	$2.4 billion	$10.2 billion
Revenue (TTM)	$390,000	$37.5 million
Net Profit Margin (TTM)	(6,159%)	(457.9%)
Free Cash Flow (TTM)	($20.5 million)	($120.4 million)
Cash and Short-Term Investments	$3.06 million	$301.8 million

These financial figures highlight some interesting similarities and differences between the two companies. Both Quantum Computing and IonQ are valued in the billions, despite their limited revenue and substantial losses.

Neither company is currently focused on making a profit. They are both in the development stage, aiming to introduce innovative technologies that could potentially lead to sustainable profits in the future.

It's essential to consider the words of IonQ regarding its future at the time of going public in 2021. The company expressed it might continue to incur significant operational losses until it begins substantial production of its quantum computers, projected to commence sometime in 2025 or later, if at all. Furthermore, they admitted that their business model remains unproven and may not become financially viable.

Similarly, Quantum Computing reflected on its struggles back in 2020, signaling serious concerns about its ability to sustain itself given its history of negative cash flow and recurring losses.

These candid assessments underscore the risks associated with investing in development-stage businesses like IonQ and Quantum Computing, Inc. The reality is that many such companies have failed to meet early expectations, leading to significant financial losses for investors.

While it’s not to say that these companies are destined for failure, investors should keep the risks in mind. Even for those willing to accept a gamble, it may be wiser to limit investments in this unstable industry, given that some promising research efforts may never culminate in commercially viable systems.

Unique Qualities of Quantum Computing Specialists

IonQ has established itself as a top manufacturer of quantum computing systems, boasting a clientele that includes various branches of the U.S. military, Hyundai, and Caterpillar. Additionally, IonQ's technology is accessible through major cloud service platforms like Amazon, Microsoft, and Alphabet.

One of IonQ’s notable products, the IonQ Forte system, became available about a year ago. Its trapped ion structure manages 32 qubits of quantum computing power, offering basic computational capabilities, but its high error rate limits practical applications. The estimated cost of this system is around $13 million, and it currently isn’t suited for real-world business tasks.

On the other hand, Quantum Computing, Inc. originally specialized in software and algorithms designed to work on quantum hardware from other providers. Recently, it merged with a hardware research entity and is now exploring opportunities to delve into hardware sales as well.

However, the company has yet to ship any tangible hardware. Their third-quarter report, released in November, underscored ongoing partnerships and research initiatives while projecting potential hardware sales opportunities as early as 2025.

Investing in Quantum Computing Stocks

Given the circumstances, it might be premature to identify long-term winners in the promising yet uncertain realm of quantum computing. A smarter approach could be to look at larger tech companies that are also venturing into quantum computing technology, including several partners associated with IonQ. These established corporations are often better positioned to handle the unpredictability associated with high-risk research projects.

Nevertheless, if tasked with choosing between these two companies in this specific face-off, the winner is apparent: IonQ has demonstrated its capacity to secure long-term development contracts and has successfully delivered systems to actual customers. Moreover, it boasts sufficient cash reserves to sustain operations for several years without the need to source additional capital in unfavorable conditions. In contrast, Quantum Computing does not share this safety net.

Thus, IonQ emerges as the more appealing investment over Quantum Computing. Each investor has different tolerances for risk, but the challenges facing the smaller competitor could be daunting.

Quantum, Investment, Technology