Classical computers process information using bits, generally illustrated by 0s and 1s. Quantum computers use quantum bits, or qubits, to tackle extraordinarily complex calculations that today's supercomputers struggle with. Quantum computing is promising to transform critical industries such as drug discovery, materials science, cybersecurity, and financial services. Naturally, investors are looking for the next big winner in this pocket of the artificial intelligence (AI) realm.
IonQ (IONQ +2.18%) and Rigetti Computing (RGTI +0.26%) are two of the most closely followed pure-play quantum computing stocks. The catch is that neither company has built a consistently profitable business because commercially useful quantum computing remains years away.
Meanwhile, Alphabet (GOOGL -1.10%) (GOOG -1.10%) has achieved some important breakthroughs in the quantum computing landscape. Let's break down what makes Alphabet a unique player in the quantum landscape to understand why the stock looks like an interesting buy right now.
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IonQ and Rigetti have enormous financial risk
On the surface, it might look like IonQ has made impressive progress in expanding its quantum computing platform. The company has spent the last few years rounding out its business to include quantum hardware, networking, and cybersecurity. During the second quarter, IonQ's revenue surged 287% year over year to approximately $80 million. However, some of that growth reflects acquisitions rather than organic growth from the original operation.
Acquisitions can be expensive, particularly when companies issue stock to finance the transactions. On Oct. 14, IonQ announced a $2 billion equity offering involving common shares and warrants. I suspect the raise is meant to fund product development and further acquisitions. Whatever the case, the opportunity cost for investors is the risk of dilution.
Rigetti faces a different challenge. During the second quarter, the company generated just $5.1 million in revenue while reporting an operating loss of $28.1 million. The company's revenue remains small and lumpy, making it difficult to predict when the business might reach profitability.
Investors considering a position in IonQ or Rigetti Computing need to weigh their upside potential against continuous operating losses, uncertain commercialization timelines, and the likelihood of future shareholder dilution.
Google's latest quantum breakthrough could be a game changer
On Oct. 15, Google's Quantum AI division announced a breakthrough involving its Willow quantum processor. The development addresses one of quantum computing's biggest challenges: error correction. Quantum computers are extremely sensitive machines. Google demonstrated a technique called magic state cultivation, which reduced errors by 40x compared with earlier testing.
This breakthrough doesn't mean Google has built a fully functional, commercially useful quantum computer. However, it represents important progress toward machines capable of performing sophisticated calculations more reliably. Moreover, Google has an advantage over its smaller competitors in that the company can afford to keep experimenting.
GOOGL Alphabet
NASDAQ · As of 2:29 PM ET 10/20/26
Alphabet stock looks like a magnificent long-term buy
Alphabet currently trades at a 23 times forward price-to-earnings (P/E) ratio. While that might not look like a bargain, investors are purchasing a profitable technology giant with multiple opportunities to expand earnings through 2030.
Alphabet already operates several profitable businesses across Google Search, YouTube, Android, and Google Cloud. These operations provide the financial flexibility to support ongoing research that might not generate meaningful revenue for several years.
Nevertheless, quantum computing is yet another component of Google's technology stack that could complement Gemini, custom Tensor Processing Units (TPUs), and enterprise cloud infrastructure. Unlike IonQ or Rigetti, Alphabet doesn't need investors to assign a premium valuation to businesses generating relatively little revenue and no profits. Instead, its established operations can support continued research while investors benefit from existing earnings power.
For now, the operating losses, financing needs, and uncertain revenue trajectories of IonQ and Rigetti make them heavily speculative investments. On the other hand, Alphabet offers exposure to new quantum technology without depending on its immediate success.
Combined with the company's robust profitability, expanding AI ecosystem, and reasonable valuation, I see Alphabet as the best quantum computing stock to buy and hold through 2030.
