Ten years go by quickly. Duke University professors Chris Monroe and Jungang Kim founded IonQ (IONQ +15.75%) in 2015. Their goal was to develop a commercially viable quantum computer. They succeeded.
Today, a growing number of customers, including pharmaceutical giant AstraZeneca (AZN +0.00%) and big automaker Hyundai, use IonQ's quantum computers. The company's revenue has soared by a compound annual growth rate of 168% since 2021.
But IonQ is still in the early stages of its journey. Where will this quantum computing pioneer be by the end of its next 10 years in business?
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An optimistic scenario
Global consulting firm McKinsey & Company predicts that quantum computing could create economic value of between $1 trillion and $2 trillion by 2035. Don't confuse those numbers with the size of the quantum computing market itself, though. McKinsey projects it will be valued between $28 billion and $72 billion – a much lower range.
However, McKinsey estimates that the quantum technology market, encompassing quantum computing, quantum communications, and quantum sensing, could reach as high as $97 billion within 10 years. IonQ is focusing on all three areas, and even bills itself as "the only quantum platform company in the world." An optimistic scenario for IonQ in 10 years is that the company becomes the clear leader across the quantum technology landscape.
Its trapped-ion architecture arguably holds the potential to be the best approach to quantum computing. IonQ's approach is scalable, more cost-effective, and requires less energy than rival methods.
The company's business development activities could also make a difference. For example, IonQ's recently announced plan to acquire Skyloom Global will expand its quantum networking and sensing capabilities.
If IonQ is able to capture 40% of McKinsey's projected quantum technology market by 2035, that would translate to annual revenue in the ballpark of $39 billion. IonQ's market cap could easily top $300 billion in this scenario – more than 17x the company's current size.
NYSE: IONQ
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A pessimistic scenario
Now for a decidedly more pessimistic scenario. IonQ could be a has-been by 2035. Probably the most plausible way for this to happen is if other companies develop quantum computing technology that's far superior to IonQ's systems.
There are plenty of rivals working hard to beat IonQ. Several of them have deep pockets, including Google Quantum AI parent Alphabet (GOOG 2.62%) (GOOGL 3.03%), Amazon (AMZN 1.43%), IBM (IBM 2.70%), and Microsoft (MSFT 0.68%).
Other competitors are smaller, but they still have a chance of preventing IonQ from becoming a huge winner in quantum computing. This list includes D-Wave Quantum (QBTS +6.47%), Quantum Computing Inc. (QUBT +6.04%), and privately held Quantinuum.
I suspect that IonQ would likely be able to compete in certain areas of quantum technology, even if superconducting or another quantum computing approach surpasses its trapped-ion architecture. However, the company might not be much larger than it is now in this scenario.
Another possibility
There is another possibility for IonQ's future, though. The quantum computing company could be acquired at some point over the next 10 years.
This scenario is especially likely if IonQ's quantum technologies, whether in quantum computing, communications, or sensing, achieve their potential. A large player seeking to improve its position in what could be a huge quantum market could decide that buying IonQ makes more sense than competing against it.
Both Alphabet (via its GV venture capital unit) and Amazon Web Services (AWS) have invested in IonQ in the past. So has Samsung (SSNL.F +0.00%). It isn't hard to envision one of these tech giants or another large company opting to acquire IonQ.
I think this scenario might be the most likely one for IonQ. The price the company can fetch will depend on the success of its technology. If IonQ can deliver on its goal to build a quantum computer with 2 million qubits by 2030, it could attract a big buyer before the middle of the next decade.
