Quantum Computing: A Hyperscaler's Advantage

Quantum computing has seen significant advancements in recent years. Google made a major announcement, and the topic has garnered much attention. As a finance expert with experience at Bloomberg, I recommend selling the name "quantum computing" and opting for a hyperscaler instead. This shift will likely be driven by the increasing demand for cloud computing services and the growing competition in the market.

Quantum computing has been a hot topic in recent years, with significant advancements and high-profile announcements, such as Google's major breakthrough. However, the finance expert at Bloomberg advises investors to shift their focus from quantum computing to hyperscalers, driven by the increasing demand for cloud computing services and the growing competition in the market [1].

Google's announcement has highlighted the potential of quantum computing, but the market is still in its early stages. The technology is expected to become commercially viable by the mid-2030s, with an $87 billion market forecasted by 2035 [2]. However, this is just one projection, and the reality could be different. The market could be smaller or larger, and there could be multiple winners or just a few.

Investors should consider the risks associated with early-stage technologies. Quantum computing is a gamble, and companies like IonQ and Quantinuum are at the forefront of this technology. While they have the potential to become significant players, they could also fail. Therefore, investors should manage their position sizing, allocating no more than 1% of their portfolio to such stocks to minimize risk [2].

Honeywell International (HON) is exploring a significant investment in Quantinuum, a leading player in advanced quantum computing. This investment could boost Quantinuum's valuation to $10 billion, according to sources familiar with the matter [3]. Analysts are forecasting a 16% upside for Honeywell's stock, with a consensus rating of "Outperform" from 28 brokerage firms [3]. However, the investment is still under discussion, and there is no certainty that an agreement will be reached.

In contrast, hyperscalers like Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform are already established in the cloud computing market. They have the infrastructure and expertise to support quantum computing services. As the demand for cloud computing services grows, these hyperscalers are well-positioned to benefit from the shift in technology.

Investors should consider the long-term potential of hyperscalers and the risks associated with early-stage technologies. By diversifying their portfolios, investors can mitigate risks and capitalize on the growing demand for cloud computing services.

References:
[1] https://www.aol.com/1-supercharged-quantum-computing-stock-094500422.html
[2] https://www.ainvest.com/news/honeywell-eyes-10b-valuation-potential-investment-quantum-computing-firm-quantinuum-2508/
[3] https://www.bloomberg.com/news/articles/2025-08-20/quantinuum-weighs-raising-funds-at-10-billion-valuation