In the rapidly evolving world of technology, artificial intelligence (AI) burst onto the scene as a hot topic in late 2022, and quantum computing may be next. Quantum computers could become a key component of AI’s evolution since they have the potential to be far more powerful than today’s biggest supercomputers.
Thank you for reading this post, don’t forget to subscribe!
Quantum computers will be able to process complex computations so quickly, using techniques unusable by standard computers, that they’d be able to easily crack most cybersecurity protections in use today. This kind of power could make a substantial impact on existing AI technology since AI models must process enormous amounts of data to correctly execute tasks.
One company focused solely on the quantum computing field is IonQ (IONQ 1.18%). It has created a unique technology that uses trapped ions to form its qubits (quantum bits). The company believes its solution will enable it to build practical quantum computers for use in industries such as finance and medicine.
The question for investors is whether IonQ’s technology has found success in the market, enabling the company’s growth.
IonQ’s revenue success
IonQ was founded in 2015, and went public in 2021. The young organization’s focus on quantum technology enabled rapid revenue growth thanks to the potency of quantum computers. Traditional computers store and process data in binary form — each bit of information is either represented by a zero or a one.
Quantum computers are in a sense binary as well, but they process data very differently, with qubits. These are made by isolating charged particles or ions that can occupy a quantum superposition of states — both one and zero and a cloud of values in between — until they are measured and the solution to the calculation the computer was tasked with is determined.
Beyond that, qubits can be entangled with each other — their states quantum mechanically connected. These (admittedly hard-for-the-layperson-to-grasp) qualities are expected to allow quantum computers to rapidly handle complex tasks that classical computers cannot.
IonQ generates revenue by selling access to its quantum computers to various organizations, such as research institutes and government agencies. So far, the company’s technology is winning customers. In the third quarter, IonQ generated revenue of $6.1 million, a whopping 122% increase from the prior-year period’s $2.8 million. That also exceeded its forecast range for revenue of $4.8 million to $5.2 million .
Its success was no fluke. IonQ’s revenue over the first three quarters of 2023 was $15.9 million, more than double the $7.3 million it made in the same period of 2022.
To buy or not to buy IonQ shares
The company is battling against more established names in the tech sector, such as IBM, which has built its own quantum computing solutions. IonQ claims it possesses a superior technology because it’s been able to scale up the capacity of its quantum computers quickly while maintaining a high level of accuracy.
This isn’t an easy feat because qubits must be kept extremely isolated from any external disturbances or they’ll break down. Usually, this means keeping qubits inside nested chambers kept at temperatures near absolute zero — something that IonQ claims it has mastered.
Certainly, its revenue growth to date has been impressive, and that suggests that IonQ’s technology is as good as it claims. But because IonQ is such a young company, it could be years before it turns a profit, and the race for leadership in the quantum computing space has just begun.