Science fiction writer Arthur C. Clarke famously put forth three laws of technology. I especially like his third law: "Any sufficiently advanced technology is indistinguishable from magic."
Clarke's idea definitely applies to quantum computing. After all, we're talking about computers that use tiny particles called qubits that can be on and off at the same time and even intertwined with other tiny particles millions of miles away. That sounds like magic, although it's not.
Quantum computing pioneer IonQ (IONQ 3.62%) has, at times, seemed magical. Its stock has skyrocketed more than 15x over the last three years. But IonQ is currently almost 40% below its peak. Is this up-and-coming quantum computing stock a buy now?
Image source: Getty Images.
The case for buying IonQ
Two critical factors in deciding whether to buy a given stock are the size of the opportunity and the company's ability to capitalize on it. IonQ seems to rate pretty well on both fronts.
The opportunity for quantum technologies is tremendous. McKinsey & Company projects that the quantum computing market will reach $72 billion by 2035. Adding quantum communication and quantum sensing to the mix is expected to boost the market size to around $97 billion.
Can IonQ seize this opportunity? The company believes that its trapped-ion architecture offers key competitive advantages over rivals, including lower cost, a smaller footprint, reduced energy requirements, and greater scalability.
IonQ is also focused on developing a full quantum platform. It isn't only about building quantum computers. The company is also developing quantum networking, sensing, and security solutions.
Probably the best evidence of IonQ's ability to capitalize on the quantum opportunity is its track record so far. The company's revenue skyrocketed 222% year-over-year in its latest quarter. IonQ's customer base includes pharmaceutical giant AstraZeneca (AZN +0.00%), large automaker Hyundai, and engineering software leader Ansys, which is owned by Synopsys (SNPS 3.35%).
NYSE: IONQ
Key Data Points
The case against buying IonQ
Why should investors stay away from IonQ? Three reasons especially stand out.
First, the company continues to lose money hand over fist. In the third quarter of 2025, IonQ posted a net loss of $1.1 billion, marking a significant deterioration from the loss of $52.5 million in the prior year period. Granted, most of the Q3 loss stemmed from negative changes in the fair value of warrant liabilities. Even adjusting for this factor, though, IonQ still lost roughly $173.8 million in the quarter.
Second, IonQ's valuation assumes tremendous growth that may or may not be realized. The quantum computing pioneer's shares trade at a trailing 12-month price-to-sales ratio of nearly 155 and at 160 times the upper end of its full-year 2025 revenue guidance.
Third, competition in the quantum computing space is fierce. IonQ is going head-to-head against several other up-and-coming pure-play rivals, including D-Wave Quantum (QBTS 5.55%), Quantum Computing Inc. (QUBT 2.56%), and Rigetti Computing (RGTI 5.05%). It also faces a handful of tech giants that are investing heavily in quantum computing, such as Google Quantum AI parent Alphabet (GOOG 1.69%) (GOOGL 1.66%), Amazon (AMZN 1.52%), IBM (IBM 0.57%), and Microsoft (MSFT 0.73%).
To buy or not to buy?
Is IonQ stock a buy now? As if often the case, I think the answer depends on your investing style.
Risk-averse investors probably shouldn't touch IonQ with a 10-foot pole. There's no guarantee that the company will emerge victorious in the quantum computing race, despite its impressive track record thus far. More cautious investors who want to potentially profit from quantum computing will likely be better off buying shares of one of the large, well-established companies that are developing quantum systems.
However, I think aggressive investors may want to consider initiating a small position in IonQ. Yes, it's a speculative stock. However, the company has a lot going for it. Buying IonQ just might pay off handsomely over the next 10 years.
