Quantum computing stocks plummeted following remarks from Nvidia (NASDAQ: NVDA) CEO Jensen Huang, who commented that ‘very useful’ quantum computers are likely decades away.
Huang’s cautious outlook dampened investor enthusiasm that had fueled a sharp rise in these stocks over the past year.
While Huang expressed optimism about Nvidia’s role in accelerating quantum advancements, his comments signaled that the technology’s widespread application remains far from imminent.
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“If you kind of said 15 years for very useful quantum computers, that would probably be on the early side. If you said 30, it’s probably on the late side. If you picked 20, I think a whole bunch of us would believe it,” said Jensen Huang
Market reaction: A pause in the Quantum computing rally
Huang’s comments sent shockwaves through the market, pausing the recent quantum computing rally.
Stocks including IonQ (NYSE: IONQ), Rigetti Computing (NASDAQ: RGTI), D-Wave Quantum (NYSE: QBTS), and Quantum Computing Inc. (NASDAQ: QUBT) tumbled sharply in premarket trading. IonQ plunged 43%, while Rigetti and Quantum Computing fell 49% and 46%, respectively, in a single day.
The sell-off erased billions in market capitalization, a stark contrast to the massive gains these companies had seen over the past year.
For instance, QUBT shares had surged over 1,800% in the last 12 months, while Rigetti and D-Wave recorded gains of 1,500% and 1,000%, respectively.
Much of this rally was driven by excitement over breakthroughs such as Google’s unveiling of its quantum computing chip, “Willow,” in December. The development marked a significant leap forward, highlighting quantum computing’s potential to address challenges beyond the capabilities of classical systems.
The sell-off extended beyond U.S. markets, with China-listed quantum computing companies such as QuantumCTek Co. Ltd and Accelink Technologies Co. Ltd also seeing their shares nosedive.
The long road ahead
Despite the sharp declines, proponents of quantum computing remain optimistic about the sector’s long-term potential.
Market forecasts paint a bright future, with the industry projected to grow from $1.16 billion in 2024 to $12.6 billion by 2032, representing an annual growth rate of 34.8%.
For investors, this presents a high-stakes opportunity in a sector poised for substantial expansion, albeit with the risks inherent in a rapidly evolving industry.
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