Quantum Computing Stocks Drop as Nvidia CEO Highlights Long Road Ahead

Shares of quantum computing companies fell sharply in premarket trading Wednesday after NVIDIA (NVDA) CEO Jensen Huang expressed skepticism about the technology’s near-term viability. Speaking during Nvidia’s analyst day event, Huang suggested that quantum computing remains decades away from widespread utility, sending shockwaves through a sector already grappling with heightened volatility and investor scrutiny.

“If you kind of said 15 years for very useful quantum computers, that’d probably be on the early side. If you said 30, it’s probably on the late side. But if you picked 20, I think a whole bunch of us would believe it,” Huang stated during a Q&A session. His remarks come amid growing excitement around quantum technology, but also persistent concerns about its practical applications and commercial readiness. Huang also noted that while quantum computing has significant potential, it still requires classical computing systems, like those powered by Nvidia, to manage error correction and optimization.

Following Huang’s comments, premarket declines were steep. IonQ Inc. (IONQ) fell 9.3%, Rigetti Computing Inc. (RGTI) plummeted 18%, Quantum Computing Inc. (QUBT) skidded 17%, and D-Wave Quantum (QBTS) lost 15%. These losses extend Tuesday’s trading session, which saw the same stocks decline between 3% and 15% amid a broader selloff in technology. The drop also contrasts sharply with their strong performance in December, following Google parent Alphabet’s announcement of its quantum computing chip, Willow, which initially fueled investor optimism in the space.

Adding to the sector’s headwinds, Quantum Computing Inc. announced late Tuesday a private placement offering of 8.16 million shares at $12.25 each, significantly below its Tuesday closing price of $17.49. The offering, expected to raise $100 million in gross proceeds, is intended to fund working capital and further develop the company’s quantum technologies. However, the announcement has spooked investors, highlighting fears of stock dilution and raising concerns about the financial sustainability of companies in the nascent quantum computing industry.

The broader sector has experienced volatile price action in recent months. For example, IonQ’s stock surged by 237% over the past year, reflecting growing enthusiasm for its pioneering work in quantum hardware and software. However, the recent selloff underscores the challenges of investing in early-stage technologies, where timelines for commercial viability remain uncertain, and external factors like macroeconomic conditions and investor sentiment can significantly sway valuations.

Huang’s comments also come amid a broader debate about whether quantum computing will match the transformative impact of artificial intelligence. While proponents argue that quantum technology could revolutionize industries from cryptography to drug discovery, skeptics point to significant technical hurdles, including the manipulation of quantum phenomena and error correction, as barriers to adoption.

Looking ahead, investors are likely to remain cautious as the quantum computing industry continues to evolve. While technological breakthroughs could reignite optimism, the combination of long development timelines, funding pressures, and high market expectations may keep volatility elevated. For now, Huang’s remarks serve as a sobering reminder of the challenges that lie ahead, even for a technology hailed as the next frontier in computing.