Quantum computing stocks saw a sharp decline on Wednesday following comments from Nvidia CEO Jensen Huang, who said that “very useful” quantum computers are still decades away.
Stocks Take a Hit After Huang’s Warning
Shares of quantum computing companies dropped significantly after Huang’s remarks at the Consumer Electronics Show (CES) on Tuesday. Rigetti and Quantum Computing each saw a drop of around 47%, while IonQ fell by 45%, and D-Wave Quantum plunged nearly 50%.
Huang stated that quantum computers capable of solving practical problems are likely still 15 to 30 years away. He said, “If you 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. But if you picked 20, I think a whole bunch of us would believe it.”
Huang explained that while quantum computing can handle small-scale problems, such as cryptography, it lacks the capability to tackle larger, more complex data problems.
The Rise and Fall of Quantum Computing Stocks
The sharp decline in quantum computing stocks follows a period of optimism late in 2024, when breakthroughs in quantum technology were announced by Google. At the time, the tech giant unveiled its new Willow chip, which analysts hailed as a game-changer for quantum computing.
The Willow chip sparked renewed hope for the future of quantum computing, with analysts predicting it could greatly accelerate applications like drug discovery, advanced material design, and encryption solutions. Bank of America analysts described Willow as a key development that could revolutionize the speed and efficiency of quantum computing.
Yardeni Research called the chip “a quantum leap in quantum computing,” noting its substantial improvement over current supercomputers.
Google’s Willow Chip and Its Impact
Following the announcement of the Willow chip, companies like Rigetti, D-Wave, and Quantum Computing saw major stock gains in December 2024. Rigetti, in particular, saw a dramatic increase of around 400%, reaching an all-time high.
The enthusiasm surrounding Willow was fueled by its potential to accelerate quantum computing’s applications. Analysts believed it could significantly enhance Google’s ability to train foundational models for various fields, including medicine and encryption.
Nvidia’s Role in Quantum Computing’s Future
Despite the recent setbacks, Huang suggested that Nvidia would play a critical role in advancing quantum computing. He expressed optimism about Nvidia’s contributions to the field, emphasizing that the company would work to bring quantum computers to market as quickly as possible.
However, Huang’s warning about the long timeline for practical quantum computers has shifted investor sentiment, highlighting the challenges that remain in bringing quantum technology to a larger scale. The road to “very useful” quantum computers, as Huang noted, is still long and uncertain.
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