Quantinuum eyes $10B IPO: What’s its potential impact on the quantum industry?

Quantinuum, a leader in the quantum computing sector, is reportedly gearing up for an initial public offering (IPO) with a valuation of $10 billion. If realized, this would mark the highest valuation ever for a quantum computing company and could potentially reshape the landscape of the quantum industry.

Quantinuum has been at the forefront of quantum advancements in 2024. In January, Honeywell successfully concluded a $300 million funding round for the company, resulting in a pre-money valuation of $5 billion. This round, led by JPMorgan Chase & Co., Mitsui & Co., and Amgen Inc., brought Quantinuum’s total fundraising to approximately $625 million since its inception.

In spring 2024, Quantinuum and Microsoft achieved a major milestone by demonstrating the most reliable logical qubits ever recorded. They conducted over 14,000 error-free experiments using Quantinuum’s ion-trap quantum hardware and Microsoft’s qubit-virtualization system for error diagnostics and correction. This breakthrough was seen as a significant step toward moving beyond the current Noisy Intermediate-Scale Quantum (NISQ) era.

Quantinuum continued its momentum into the summer, upgrading its quantum processing unit (QPU) H2 from 32 to 56 qubits and achieving a record fidelity of 99.84% for two-qubit gates. This milestone made it the first trapped-ion-based QPU to exceed 50 qubits. While this achievement is promising, the chip’s architecture, based on the 2023 racetrack design, may face challenges in scaling compared to more advanced two-dimensional (2D) architectures, which are in development by Quantinuum and other competitors like Universal Quantum, Oxford Ionics, and AQT.

Honeywell’s announcement of a potential IPO valuing Quantinuum at $10 billion sent ripples through the quantum industry. Quantinuum, established in 2021 through the merger of Cambridge Quantum and Honeywell Quantum Solutions, is one of the largest full-stack quantum companies, with about 500 employees across the United States, the U.K., Germany, and Japan. Honeywell currently holds a 54% ownership stake, while Ilyas Khan, founder and chief product officer, holds 23%. Other shareholders include IBM and Japan's JSR Corp.

This would not be the first quantum company to go public, but previous IPOs have produced mixed results. Rigetti and D-Wave both went public via special-purpose acquisition companies (SPACs) in 2022 and faced challenges, including delisting risks, although they have since regained compliance. IonQ, which also uses ion-trap technology like Quantinuum, went public in 2021 and has maintained a relatively stable performance, with some fluctuations.

Given Quantinuum’s recent achievements, the timing for an IPO could be favorable. But the process typically takes six months to a year, so the earliest we might see a Quantinuum IPO would be in early 2025.

If successful, a $10 billion valuation would position Quantinuum to significantly accelerate its research and development efforts, and potentially solidify its leadership in the quantum sector. This move could also provide a much-needed boost to the quantum industry—increasing competition and attracting more funding. Quantum computing is still a long-term bet, with technology evolving rapidly, but the road to a truly useful quantum computer remains challenging. Nonetheless, global public and private investment in quantum technologies remains strong, with over $30 billion in public and an estimated $4 billion in private investment to date, most of which was directed toward quantum computing hardware.

The potential Quantinuum IPO could further catalyze growth within the quantum sector, encouraging more investment and bringing quantum computing into the spotlight. As the quantum ecosystem matures, this IPO could mark a significant step forward in the journey toward realizing the full potential of quantum technology.

SOURCE

See www.yolegroup.com/product/report/quantum-technologies-2024.