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Nvidia CEO Jensen Huang recently predicted it could take 15 to 30 years to bring "very useful quantum computers" to the market. He said those systems would require a million more quantum bits (qubits) than they have today.
Huang's cautious comments caused two of the market's most popular quantum computing stocks, IonQ (NYSE: IONQ) and Rigetti Computing (NASDAQ: RGTI), to plunge 39% and 45%, respectively, on Jan. 8. Let's see why that happened -- and if IonQ and Rigetti are still worth buying after their precipitous declines.
Why did Huang's comments burst the quantum bubble?
Traditional computers store their data in binary bits of zeros and ones. Quantum processing units (QPUs) can store zeros and ones simultaneously in qubits, which enables them to process data much faster than traditional computers.
But quantum computers are much larger and pricier than their binary counterparts, and they tend to produce more errors with their rapid fire calculations. That's why they're still mainly used by universities, research institutions, and government agencies for niche calculations instead of more practical applications for mainstream businesses.
Therefore, Huang's prediction that quantum computers won't go mainstream for 15 to 30 years sounds reasonable. It took Nvidia about two decades for its gaming and professional visualization graphics processing units (GPUs) to evolve into AI accelerators for data centers.
However, nascent quantum computing companies like IonQ and Rigetti -- which both went public by merging with special purpose acquisition companies (SPACs) -- generated a lot of buzz with their bold predictions. Many investors scooped up their stocks, which propelled their valuations to meme stock levels. That's why both stocks plunged after Huang's latest comments.
How expensive were IonQ and Rigetti?
IonQ sells quantum computing systems to government agencies and universities. It also provides its quantum computing power as a cloud-based service. To scale up its systems, it's been developing a "trapped ion" technology which aims to shrink the width of a QPU from a few feet to a few inches. That could help it scale up its systems at a faster and cheaper rate while reducing their errors, but those efforts suffered a setback after its co-founder and chief scientist Chris Monroe stepped down in 2023.
Rigetti designs and manufactures QPUs, and its Forest cloud platform enables developers to write their own quantum algorithms on its systems. In late 2024, it launched its Novera QPU -- a 9-qubit commercial version of its own quantum computer which costs $900,000. It also recently deployed its first 84-qubit Ankaa-3 system, which can detect more than 99% of processing errors, and it plans to deploy a more powerful 100-qubit system with an even higher error-detection rate this year.