The quantum computing industry has emerged as one of the hottest investment topics of 2024, with major players seeing their stocks rise amid growing business and government interest. Industry research firm Fortune Business Insights projects that the global quantum computing market will grow from $1.16 billion in 2024 to $12.6 billion in 2032, representing an annual growth rate of 34.8%.
Two prominent pure-play quantum computing companies, IonQ (IONQ 0.59%) and Reject Computing (RGTI 51.23%)offers investors different approaches to this revolutionary technology. While both stocks delivered impressive gains in 2024, their business models, technological approaches and current market positions show notable differences. Here’s how these quantum computing contenders stack up for investors.
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Revenue drive and scale
IonQ showed stronger commercial traction, with revenues for the third quarter of 2024 reaching $12.4 million, representing 102% year-on-year growth. The company secured $63.5 million in new bookings, including a $54.5 million contract with the US Air Force Research Laboratory to develop quantum networking systems.
Rigetti reported a more modest Q3 2024 result of $2.4 million. However, the company maintains strong research partnerships, including a prominent position at the UK’s National Center for Quantum Computing, where its 24-qubit system supports advanced quantum research and development.
Technological approaches
IonQ employs quantum computing technology of trapped ions, which offers high stability and connectivity between qubits. The company’s systems have demonstrated strong performance and reliability metrics in cloud-based quantum computing services.
Rigetti focuses on superconducting qubit technology, achieving a gate speed 10,000 times faster than trapped ion systems. The company manufactures its chips in-house at Fab-1, the industry’s first dedicated quantum device manufacturing facility, which provides greater control over its technology development.
Strategic partnerships and development
IonQ announced several strategic moves in Q3 2024, including plans to acquire quantum networking company Qubitekk. The company has also formed partnerships with AstraZeneca for drug discovery applications and Ansys to integrate quantum computing with the $10 billion computer-aided engineering industry.
Rigetti has focused on advancing its core technology, planning to introduce a new modular system architecture in 2025. The company expects to achieve 99.5% median two-qubit fidelity in its next system of 36 qubit, followed by a 100-plus qubit system per year. -end 2025, showing its focus on scalable quantum processing units.
Financial situation and valuation
IonQ maintains a stronger cash position, with $382.8 million in cash and investments as of September 30, 2024. However, the company’s Q3 net loss reached $52.5 million, reflecting the heavy investment continued in research and development. With a market capitalization of $8.2 billion, IonQ trades at 212.6 times sales.
Rigetti reported $92.6 million in cash and investments at the end of the quarter, with a narrower Q3 net loss of $14.8 million. While its market capitalization of $1.22 billion seems more modest, the company is still trading at 60 times sales, highlighting premium valuations in the quantum computing sector.
Which quantum computing stock is best to buy?
Both companies have attracted significant institutional investment in 2024, with companies such as Vanguard and BlackRock increasing their positions in every quantum computing stock in the second half of the year. IonQ offers stronger business momentum and a more robust balance sheet, while Rigetti’s manufacturing capacity and technology roadmap present unique competitive advantages.
For investors seeking exposure to quantum computing, IonQ’s revenue growth and government contracts provide more near-term visibility despite its higher valuation. Rigetti, on the other hand, offers a more speculative opportunity focused on the advancement of superconducting technology.
However, with both stocks trading at high premiums and quantum computing still in its early stages, investors should size positions accordingly in a diversified portfolio.