Alphabet Inc. (NASDAQ: GOOGL) saw its shares jump by over 5% on December 10, marking the tech giant’s largest single-day gain since April 2024.
This surge followed the announcement of its quantum computing chip, “Willow,” a breakthrough hailed as a game-changer in quantum computing, widely regarded as the next frontier in the tech industry.
The news sent ripples across the broader technology and cryptocurrency markets. The company’s stock closed at its highest level since July at $185.24, adding approximately $136 billion to its market valuation.
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Quantum leap: Willow’s breakthrough
On December 9, Google Quantum AI introduced the Willow chip, a quantum chip with qubits that significantly advances error correction, a long-standing challenge in quantum computing.
In a benchmark test, Willow completed a computation in under five minutes that would take Frontier, the world’s fastest supercomputer, ten septillion years to solve—a timescale far exceeding the universe’s known age.
Hartmut Neven, head of Google Quantum AI, emphasized that Willow’s error correction capabilities improve as qubit grids expand, addressing critical bottlenecks in scaling quantum systems.
Willow represents the second milestone in Google’s six-step roadmap toward developing commercially viable quantum systems, with an ambitious goal of scaling to 1 million qubits.
While quantum computing is still in its infancy, Willow’s advancements bring Google closer to practical applications in areas such as AI, drug discovery, energy optimization, and cryptography.
Sundar Pichai, CEO of Google, emphasized that the chip could eventually perform tasks that are impossible for conventional computers, such as identifying molecular structures for drug development or optimizing renewable energy grids.
“We’re working on eventually making quantum hardware, tools, and applications available to customers and partners, including through Google Cloud so that they can harness the power of quantum in new and exciting ways,” Pichai said.
Broader market impact
The ripple effect of Willow’s debut extended to the broader technology and cryptocurrency markets. Quantum computing stocks were quick to rally, with Rigetti Computing Inc. (NASDAQ: RGTI) soaring 45% and D-Wave Quantum Inc. (NYSE: QBTS) rising 16% before paring gains to close up 0.7%.
Meanwhile, the crypto market reacted cautiously to Google’s announcement, with concerns emerging about the implications of quantum computing for blockchain security.
Willow’s computational power could theoretically crack encryption protocols, sparking fears of vulnerabilities in crypto wallets and exchanges. This triggered panic selling among crypto traders, resulting in the liquidation of over $1.6 billion within 24 hours, as reported by Finbold.
Despite these concerns, Google’s advancements remain years away from having a tangible impact on encryption.
Beyond the excitement surrounding quantum computing, optimism around Alphabet’s broader prospects continues to grow.
Piper Sandler analyst Thomas Champion identified Alphabet as a “top pick” for 2025, citing survey data highlighting strong adoption of Google’s AI tools like Gemini, which are expected to be disruptive in the coming year.
Champion also pointed to the continued growth of Google Cloud and YouTube subscriptions as major drivers of future revenue. Piper Sandler maintains an “Overweight” rating on Alphabet, with a $210 price target, suggesting a potential 14% upside.
Moreover, technical analysis suggests an even more optimistic outlook, pointing to a potential price target of $235 by Q1 2025
With advancements in quantum technology and robust growth across key segments, Alphabet’s future looks promising as it continues to shape the trajectory of innovation.
Featured image from Shutterstock.
