Quantum computers have the potential to be significantly more powerful than classical computers, making their potential applications enormous in the world of cryptography, machine learning and artificial intelligence more broadly. These machines use encoded quantum bits—qubits—to transmit more information and perform processes faster than traditional bits in classical computing. Quantum computers aren’t just slightly more efficient than conventional computers: in 2023, Alphabet Inc., Google’s parent company, NASDAQ: GOOG have developed a quantum computer that can accomplish in seconds what a pre-existing supercomputer could only complete in a whopping 47 years.
Unsurprisingly, there is a huge race among tech companies to produce quantum computers and related technologies that will be practical and useful in real-world applications. Apart from Google, other tech giants such as Amazon NASDAQ: AMZN and Microsoft Corporation. NASDAQ: MSFT have made significant efforts in this area.
But now a much smaller player is diverting investor attention away from industry stalwarts. Quantum Computing Inc. NASDAQ:CUBE has become an active asset in the rapidly growing landscape of photonics and quantum technologies. Indeed, QUBT is among the best-performing stocks in the entire market for 2024, with a year-to-date return of 869.5% as of December 6, 2024. However, Quantum Computing faces stiff competition from other emerging industry specialists, including IonQ. Inc. New York Stock Exchange: IONQwhich has more than tripled since the beginning of the year.
QUBT Profile: Small Cap, Chip Supply, Amazon Boost
Quantum Computing Today
Quantum computing
(As of 12/06/2024 ET)
- 52 week range
- $0.35
▼
$9.20
- Target price
- $8.50
What sets QUBT apart from some of its competitors? The firm is decidedly small-cap, with a market capitalization of just $881 million as of December 6th. Additionally, it has yet to generate revenue, meaning it has yet to demonstrate its ability to generate significant revenue through the sale of its products. This means that investments in QUBT are necessarily speculative and that the company’s valuation is dependent on expectations that it can ultimately deliver on the promises of its technologies and products in development.
QUBT does have a lot of promise in these development projects. The firm received its first order for its lithium niobate thin-film photonic chips in mid-November, with delivery likely to be completed by the end of the first quarter of 2025. The customer, “a renowned research and technology institute based in Asia,” may use the chips in telecommunications or data communications applications. Following this announcement, Quantum Computing made another announcement that a second order had been placed.
Another big boost for QUBT was the announcement that Amazon AWS was launching an advisory program called Quantum Embark. The program will help Amazon customers prepare for the widespread arrival of quantum computing. Given Amazon’s massive reach, it’s likely that this program has helped generate significant additional interest in QUBT, as well as other quantum computing firms.
A detailed look at QUBT’s latest earnings
Quantum Computing Stock Forecast Today
$8.50
Growth potential 7.19%Buy
Based on 1 analyst estimates
| High forecast | $8.50 |
|---|---|
| Average forecast | $8.50 |
| Low forecast | $8.50 |
Quantum Computing Stock Forecast Details
On November 6, 2024, Quantum Computing released its third-quarter earnings report, showing a decline in gross margin to 9% from 52% in the prior-year period. The company said the decline in this area was due to its work to fulfill a contract with Johns Hopkins University.
On the positive side, however, the company noted a net loss of $5.7 million, less than in the third quarter of 2023, and an increase in net assets of $2.4 million compared to that period. The firm ended the quarter with net assets of $76.8 million, while net liabilities roughly doubled to nearly $11 million.
However, perhaps more noteworthy for investors was the news in the earnings report that Quantum Computing still expects its Arizona foundry to begin production in early 2025; this should be an important step towards achieving a stable income.
Where can QUBT go next?
To consider the future growth potential of QUBT at this stage, it is useful to look at the projected growth rates of the broader quantum computing industry. Analyzes vary widely, but some estimates suggest the industry could be worth about $12 billion by 2032. If this is the case, and technology adoption is slow (perhaps due to long product development periods or other unforeseen delays), Quantum Computer Technologies may not have as much room for further growth.
On the other hand, a more optimistic view of the growth path of the overall quantum market could mean large additional demand for QUBT products and potentially unlimited future profits.
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