Quantum Stocks Move Higher On Microsoft’s Cloud Comments (IONQ, QBTS)

Quantum computing stocks are experiencing a significant upswing, fueled by renewed optimism and validation from industry giants like Microsoft.

D-Wave Quantum Inc. (QBTS) and IonQ, Inc. (IONQ) have led the charge, witnessing substantial overnight gains as investors react to Microsoft's assertion that quantum computing will be the next major accelerator of growth in cloud computing.

This endorsement, coupled with recent technological advancements and strategic moves by key players, is driving a resurgence in investor interest in the burgeoning quantum sector. NVIDIA's CEO, Jensen Huang, also expressed optimism in recent times, stating that the industry is “reaching an inflection point,” further bolstering confidence.

QBTS is trading up 4.16% at $17.77 in the pre-market, while IonQ is at $41.32, for a 3.61% gain leading into the open.

Both stocks, while still volatile, are trading near YTD highs, with D-Wave benefiting from increased adoption of its Leap Quantum LaunchPad and growing cloud service contracts. IonQ has advanced on the back of technical milestones and strategic partnerships, solidifying its position as a leading gate-based quantum computing company.

Adding to the positive sentiment, Rosenblatt Securities recently initiated coverage with “Buy” ratings on both QBTS and IONQ, setting ambitious price targets of $30 for QBTS and $70 for IONQ.

Rosenblatt believes D-Wave offers a differentiated way to gain exposure to the rapidly growing quantum computing market, citing the advantages of quantum annealing for optimization workloads.

They also view IonQ as an attractive way to gain exposure, predicting the quantum computing market will be a “multiple winner market and not a winner takes all market.” Rosenblatt projects that IonQ will exit 2025 with annualized revenues exceeding $100 million, nearly doubling in 2026, and potentially reaching $1 billion in revenue in the coming years.

Looking ahead, investors are keenly awaiting upcoming earnings reports. D-Wave Quantum's next earnings are expected in mid-August 2025, with analysts forecasting revenue of approximately $4.8 million and a modest improvement in EBITDA losses as enterprise adoption expands.

IonQ's next earnings call is due up first, in early August, with consensus expectations pointing to revenue near $8.6 million and continued investment in research and development to scale hardware. Losses are expected to narrow compared to previous quarters.

Whilst the quantum computing sector is experiencing a resurgence, driven by technological advancements, strategic acquisitions, and strong endorsements from industry leaders like Microsoft and NVIDIA, it's crucial to acknowledge the inherent risks associated with the sector. The technology is still in its early stages of development, and commercial viability remains uncertain, for now.