IONQ Stock: Does IonQ Justify the Quantum Computing Hype?

IonQ [IONQ] is a company that develops trapped-ion quantum computers for commercial, industrial and academic applications.

The company sells quantum computing and networking hardware, together with related maintenance and support. IonQ has also made its quantum computers available on popular cloud platforms such as Amazon [AMZN] Web Services, Microsoft’s [MSFT] Azure and Alphabet’s [GOOGL] Google Cloud Marketplace.

This analysis will discuss the latest developments, earnings, market performance and the bull/bear cases for IONQ stock.

Key Developments: Acquisitions, Collaborations and Contracts 

2025 has been an eventful year for IonQ. 

It kicked off with the completion of the acquisition of a quantum networking company called Qubitekk.

Soon after, IonQ announced the award of a $21.1m project via newly acquired Qubitekk from the US Air Force Research Lab. 

It marked the second time in under 12 months that IonQ secured a contract from the US Air Force, following a four-year, $54.5m deal awarded in September 2024. In April 2025, the company secured a $22m deal to develop a new quantum innovation center in Tennessee.

International deals followed as IonQ signed agreements with the Busan Metropolitan Government in South Korea, Japan’s Toyota Tsusho [TYHOY] and the UAE’s Technology Innovation Institute.

The Maryland-based company continued to snap up quantum computing start-ups.

On May 6 it announced the acquisition of Switzerland-based ID Quantique and its catalog of nearly 300 granted and pending patents, which took the total number of patents under IonQ’s control to over 900.

The next day, IonQ announced its intention to acquire a Boston-based start-up called Lightsynq Technologies. 

The biggest acquisition of the year came in June when IonQ bought UK-based Oxford Ionics in a cash-and-stock deal worth $1.075bn.

“At Oxford Ionics, we have not only pioneered the most accurate quantum platform on the market, we have also engineered a quantum chip capable of being manufactured in standard semiconductor fabs,” said Oxford Ionics CEO Chris Ballance. 

In July, IonQ announced that it had been selected as the primary quantum technology provider by the Korea Institute of Science and Technology Information for a multi-million-dollar government contract.

Additionally, on July 7, IonQ raised $1bn in the sale of stock and warrants to Heights Capital Management, an affiliate of Susquehanna, the largest institutional investment in a quantum computing company to date. 

IONQ share price: High Beta Stock

IonQ listed on the New York Stock Exchange via a special-purpose acquisition company in October 2021. Since then, the IONQ stock has increased 281% in value, as of July 14.

Most of the gains have come over the past year, with the stock price rising by 402% during the period.

On January 7, 2025, IONQ stock hit an all-time high of $54.74. However, in about two months after its peak, share prices dropped as much as 67% to $17.88 on March 11.

As of July 14, IONQ had covered losses to trade flat in year-to-date terms at $42.41. In comparison, the Defiance Quantum ETF [QTUM] is up 14.3% in the same period.

IONQ’s five-year monthly beta, a measure of stock price volatility, was 2.59 at the time of writing.

Key Fundamentals and Financial Health: R&D Expenses Dwarf Revenue

During the first quarter of 2025, IonQ reported revenue of $7.57m, flat from $7.58m a year ago.

Net loss for the quarter came in at $32.25m compared to $39.59m a year ago.

The company forecast full-year revenue for 2025 will be between $75m and $95m.

In 2024, IonQ reported full-year revenue of $43.07m, an increase of 95% from 2023.

Research and development expenses in 2024 were approximately 317% of the company’s full-year revenue.

IONQ vs QBTS vs RGTI: Quantum Competitors

D-Wave Quantum [QBTS] and Rigetti Computing [RGTI] are pure-play quantum computing companies listed in the US. Like IonQ, both companies are unprofitable.

Source: Yahoo Finance

IONQ Stock: The Investment Case

The Bull Case for IonQ: the Nvidia of Quantum? 

IonQ is aiming to become the “Nvidia [NVDA] of quantum computing”.

At the time of writing, IonQ was the most valuable publicly listed pure-play quantum computing company in the US. 

The company follows a full-stack approach: designing and customizing next-gen computers, offering quantum-as-a-service through major cloud platforms and delivering quantum networking solutions to enhance the capabilities of existing infrastructure.

Additionally, IonQ set itself apart from the competition by using ion trap architecture. A key advantage of this design over the superconducting design used by many quantum systems is that the chips do not need to be cooled to subzero temperatures. This ability to function at room temperature could accelerate the adoption of IonQ’s quantum computers.

The Bear Case for IonQ: Uncertain Road Ahead

IonQ and quantum computing are enticing prospects. However, investors have to remember that IonQ has yet to turn a profit, and quantum computing technology has not yet demonstrated large-scale, economically viable use cases.

In January, Nvidia CEO Jensen Huang poured cold water on investor enthusiasm after he said that the practical use of quantum computing technology was about 20 years away.

Adding to the gloom was a March 2025 short-seller report from investment management firm Kerrisdale Capital, which said that IonQ’s market valuation “defies both logic and the warnings of former IonQ employees, who highlighted monumental scaling challenges that will derail the company’s ambitious plan.

“Quantum computing may hold transformative potential someday, but the path is long, uncertain and fiercely competitive with better-resourced players (both in quantum and classical computing) vying for dominance. Based on our research, IonQ is not even the clear leader among ion trap-based quantum computing providers. As reality sets in, IonQ shareholders chasing a quantum leap will find themselves wishing they had stayed in a more stable state,” said Kerrisdale Capital.

Conclusion

The three pure-play quantum computing stocks mentioned above, IONQ, QBTS and RGTI, trade at high valuations relative to their sales. Their average P/S ratio at last close was 229.46. Investors must now analyze the price they want to pay for exposure to this next-generation technology.