By Mackenzie Tatananni

Shares of D-Wave and Quantum Computing were rising in premarket trading Thursday as quantum stocks continued to make their recovery.

D-Wave and Quantum Computing shares were up 9.8% and 20%, respectively, while peers Rigetti Computing and IonQ rose 5.4% and 0.7%.

While D-Wave continued to see gains, these were moderate compared to Wednesday, when the stock surged 22% on the heels of a new partnership with Carahsoft, a federal information-technology contractor. Carahsoft will serve as D-Wave's "Master Government Aggregator," making D-Wave's quantum systems available to the public sector.

Lorenzo Martinelli, chief revenue officer at D-Wave, said the partnership was crucial for speeding up the government's adoption of quantum computing.

Also this week, IonQ unveiled plans to build a quantum-intelligence campus on the grounds of the University of Maryland at College Park. The $1 billion "Capital of Quantum" initiative, in collaboration with the university and the state of Maryland, aims to "establish Maryland as the 'silicon valley' of the quantum computing industry," IonQ said.

Quantum stocks broadly slid last week after Nvidia CEO Jensen Huang said the technology would take decades to become "very useful."

However, the chip maker said Tuesday that it would host its own "Quantum Day" during Nvidia's GTC 2025 conference in March. Huang will share the stage with industry leaders from D-Wave, IonQ, Rigetti, and other companies during the event, Nvidia said.

While Nvidia has several endeavors in the field of quantum computing, the company's core business strategy centers on the design and manufacturing of graphics processing units. Nvidia is the largest volume producer of accelerators for artificial intelligence, a sector that is expected to be disrupted with the advent of quantum technology.

In a statement last week, IonQ CEO Peter Chapman said he expects natively quantum AI to outperform classical AI.

Similarly, D-Wave CEO Alan Baratz told Barron's that quantum computing could remedy the challenges that come with AI adoption, such as computational demands and rising energy costs.

"There is massive potential for AI and quantum to work together to advance the limitations of today's classical computing capabilities," Baratz said. "Quantum will enable AI model training and inference that runs much faster and with much lower energy consumption."

There is a continuing debate about how long this will take. Industry leaders like Chapman and Baratz has emphasized that their quantum technologies are being used by clients today.

However, analysts are a bit more cautious. Bill Stone, chief investment officer at Glenview Trust, told Barron's on Tuesday that quantum computing "is currently in speculation territory."

"It's just too early in quantum computing to have any reasonable idea of future revenues and profits," Stone said.

Speaking to Investor's Business Daily on Thursday, former Cisco CEO John Chambers echoed the sentiment.

"Quantum will really make a difference. But perhaps we're early," Chamber said. "I'm still as optimistic long term on quantum as I was five years ago. But I do not see it in the short run."

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

January 16, 2025 09:18 ET (14:18 GMT)

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