Quantum computing has the potential to be a revolutionary technology -- but potential only gets you so far, and after a monster run in 2025, I believe we're headed for a reckoning within the industry. The quantum pure plays -- IonQ (IONQ 1.76%), D-Wave Quantum (QBTS 3.90%), Rigetti Computing (RGTI 1.48%), and Quantum Computing (QUBT 1.54%) -- have reached valuations that are hard to justify unless the most optimistic of predictions come true.
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Quantum computing stocks are overvalued in 2026
Let's start with some basic numbers. Despite trailing-12-month (TTM) sales of just over $24 million, D-Wave commands a market capitalization of $10 billion. Rigetti brought in $12.7 million in the same period and carries a $8.5 billion market cap. Quantum Computing delivered just $550,000 in TTM revenue while boasting a market cap of nearly $3 billion.
While IonQ, the most successful of the bunch so far, brought in a respectable TTM revenue of nearly $80 million, its market cap is a whopping $18 billion.
These valuations just do not add up unless incredible growth is relatively near, but despite extremely optimistic messaging within the industry, it is entirely possible that real commercialization is a decade or more away.
How long until we have useful quantum computing?
While some proponents would have you believe commercialization is right around the corner -- and yes, it is certainly possible -- I think there's plenty of reason to believe it's much further off.
That's exactly what a recent MIT report concluded: that large-scale commercial applications likely remain "far off." Morningstar's analysis puts early commercialization at five to 10 years away, while general-use quantum computing -- the kind that would justify multibillion-dollar valuations -- is likely 20 years out.
Remember, this technology sits at the outer edge of human knowledge. It's still more pure science than hard engineering. In fact, some prominent academics continue to question whether useful quantum computing is even possible at all.
NASDAQ: RGTI
Key Data Points
Gil Kalai, a mathematician at Hebrew University, believes that quantum error correction -- one of the most essential technical problems the industry has to solve -- is inherently impossible. Mikhail Dyakonov, a theoretical physicist at the University of Montpellier in France, also argues that it is likely impossible and that if it is possible at all, even a three-decade timeline is too much to hope for.
Of course, the skeptics could be wrong, and many established researchers believe they are, but the fact that respected physicists and mathematicians are publishing peer-reviewed papers arguing that quantum computing might be fundamentally impossible should give investors pause.
Will quantum stocks crash in 2026?
I predict 2026 will be a "show me" year for the current bull market. While investors today appear willing to give companies a very long leash when it comes to delivering real returns, that can't go on forever. I believe that the pure-play quantum companies will struggle to deliver on promised milestones, and the reality of a much longer commercial timeline will set in. The hype will fade as investors weigh just how much they are willing to pay for promises of future returns.
We've seen it before. Remember 3D printing stocks in 2013-2014? Companies like 3D Systems and Stratasys commanded multibillion-dollar valuations on promises of revolutionary manufacturing. When commercial adoption proved much slower than hyped, both crashed by roughly 90% by 2016. It's a pattern we've seen many times, and I believe we are seeing it here, too.
Here's what quantum investors should buy instead
It's not all doom and gloom, however. Over the long term, I'm still bullish on the technology. I am not, however, bullish on these pure-play quantum companies, at least not at their current, inflated valuations.
Alphabet (GOOG 0.72%) (GOOGL 0.69%) is a different story. The company is at the forefront of the technology's development with some of the best talent in the world, and, most importantly, it has more than enough resources to continue to develop quantum computing indefinitely. If it takes five years or fifty, Alphabet will be there to profit. I'm not sure I can say the same for the pure plays.
