When investors talk about artificial intelligence (AI) stocks, they often focus on chipmakers like Nvidia (NVDA 1.53%), which supplies the data center GPUs used for processing complex AI tasks, or cloud giants like Microsoft, which develop the actual AI software.
Yet quantum computing companies could also benefit from the secular expansion of the AI market. Unlike traditional computers, which store their data in binary bits of zeros and ones, quantum computers can store those zeros and ones simultaneously in "qubits." That difference enables them to process larger amounts of data at much faster speeds -- which makes them well-suited for crunching massive amounts of information for AI applications.
Two popular quantum computing stocks are Quantum Computing Inc. (QUBT 2.56%), also known as QCi, and IonQ (IONQ 3.47%). Over the past 12 months, QCi's stock surged nearly 2,280% as IonQ's stock rallied more than 510%.
Let's see which of these high-flying stocks is a better play on the quantum computing and AI markets.
Image source: Getty Images.
The differences between QCi and IonQ
Quantum computers are much faster than traditional servers and mainframes, but they're bigger, pricier, consume more power, and output a higher percentage of errors. To resolve those issues, companies like QCi and IonQ are developing new technologies that could make quantum processing units (QPUs) smaller, cheaper, and more scalable.
Most quantum computers are powered by ions (individually charged atoms), electrons (subatomic particles with a negative charge), or photons (particles of light). In ion-driven systems, ions are trapped in electromagnetic fields and manipulated with lasers. In electron-driven systems, electrons are sped up in "superconducting loops" to process data. In photon-driven systems, light particles are used to transmit the data.
QCi develops photonic chips, which operate at room temperature and can be produced at conventional chip fabs. It doesn't build any of its own quantum systems, but it provides a cloud-based platform for simulations.
IonQ produces "trapped ion" chips, builds its own systems (its older Aria system, its flagship Forte system, its data center-oriented Forte Enterprise system, and its upcoming Tempo system), and provides its own cloud-based services. But unlike photonic systems, ion-driven systems still require moderate cooling.
Meanwhile, electron-driven superconducting systems, like the ones produced by IBM and Rigetti Computing, can only function in cryogenic environments. That makes them the most expensive to maintain, but those chips are also the easiest to mass-produce with existing lithography technologies.
Which of these companies has a brighter future?
QCi only started manufacturing and delivering its first photonics chips this year, so the technology remains in its infancy. So, while the idea of quantum chips functioning at room temperature sounds disruptive, it hasn't proven that its business model is sustainable yet. Its main customers are still small design firms and research institutions.
For 2025, analysts expect QCI to generate just $400,000 in revenue with a net loss of $39 million. But by 2027, they expect its revenue to more than quadruple to $1.85 billion with a net loss of $44 million as it scales up production of its photonic chips, rolls out its own Dirac-3 quantum system, and expands its Qatalyst cloud platform.
NASDAQ: QUBT
Key Data Points
IonQ's business is more mature. From 2024 to 2027, analysts expect its revenue to surge from $43 million to $315 million as its ion-driven systems are adopted across more industries. But they still expect its annual net loss to widen from $332 million to $552 million.
For now, IonQ is focused on increasing its total quantum computing power, which it measures in algorithmic qubits (AQ). It expects that figure to soar from 64-100 AQ in 2025 to 100-256 AQ in 2026, 10,000 AQ in 2027, 20,000 AQ in 2028, 200,000 AQ in 2029, and 2 million AQ in 2030.
Investors should take that ambitious outlook with a grain of salt, but IonQ hit its previous long-term AQ targets before. Its ongoing efforts to shrink the width of its QPUs with its trapped ion technology (from a few feet to a few inches) -- could support that explosive growth spurt. It's also been integrating Nvidia's CUDA (Compute Unified Device Architecture) parallel computing platform into its own quantum systems to support a broader range of AI applications.
NYSE: IONQ
Key Data Points
The better buy: IonQ
QCi's photonics technology is promising, but its stock is already valued at more than 1,300 times its projected revenue for 2027. That meme stock valuation makes it a dangerous stock to own, and it could easily crash if it struggles to scale up its business. IonQ is also speculative, but it looks more reasonably valued at just over 40 times its estimated sales for 2027. Therefore, it's smarter to stick with IonQ than to pay a sky-high premium for QCi's potential growth.
