Quantum Computing Stocks Plunge Amid Trump Tariffs: IonQ, Rigetti Chosen for DARPA Program

Ladies and gentlemen, buckle up! The quantum computing sector is in for a wild ride. On April 2, 2025, the U.S. government slapped new tariffs on imported goods, ranging from 10% on British goods to a whopping 34% on Chinese products. This move, aimed at boosting domestic production and reducing foreign dependence, has sent shockwaves through the quantum computing industry. And guess who’s feeling the heat? Our beloved quantum startups like IonQ and Rigetti Computing!

These tariffs are not just another bump in the road; they’re a full-blown earthquake for quantum startups. Why? Because their systems rely on a precise, global web of vendors for specialized components. For instance, IonQ’s trapped-ion computers need ultra-pure laser systems from Germany, while Rigetti Computing’s superconducting qubit arrays depend on dilution refrigerators sourced from the UK. These components are not easily replaceable with domestic alternatives, and in most cases, there is no backup source. This dependency on foreign suppliers means that any disruption or increase in cost due to tariffs can have a cascading effect on the startups' operations.

The immediate impact? A sudden 20% cost rise on core components, which stretches timelines, shelves prototypes, and makes quarterly burn rates harder to justify. As a result, quantum computing stocks like IonQ, Rigetti Computing, and D-Wave Quantum saw modest but immediate declines. These companies are not yet profitable and rely on continued research, rapid iteration, and access to high-performance parts. The increased costs and delays can push back major milestones by a year or more, affecting investor calls, earnings estimates, and partner agreements. For example, a six-month shipping delay on a laser component can push back a major milestone by a year, which is a significant setback for small-cap stocks that operate on tight timelines and budgets.

But it’s not all doom and gloom! There are strategic moves these startups can make to mitigate these challenges. One potential move is reshoring key elements of the supply chain, not entirely, but enough to insulate against shocks. This will require time, partnerships, and likely additional government support beyond the current scope of the CHIPS Act. In the interim, smaller firms can deepen ties with less tariff-affected regions, such as South Korea and India, for specialized equipment. Some may shift limited manufacturing abroad to avoid import fees altogether, though this poses its own logistical and political risks.

Another path is tighter collaboration. In the past, these startups have prided themselves on differentiation; different qubit models, different visions for scaling, and different views on error correction. They may need to work together, sharing parts of the supply chain or co-investing in fabrication access to keep their programs on track. For example, Rigetti Computing has partnered with Riverlane, a leader in quantum error correction (QEC) technology, to refine its proposed Utility-Scale Quantum Computer (USQC) concept and validate the underlying technology. This collaboration allows Rigetti to leverage Riverlane's expertise in QEC, which is crucial for scaling towards fault-tolerant systems.

Now, let’s talk about the big players. Larger tech firms like IBM, Microsoft, and Alphabet have several advantages over smaller quantum computing companies in navigating the new tariff landscape. These advantages include financial resilience, in-house manufacturing, long-term stockpiles, and supply chain flexibility. These firms have the capital and scale to absorb higher component prices. Sometimes, they manufacture key parts in-house or have long-term stockpiles. They can reroute supply chains or buy their way around delays if needed. This financial stability allows them to weather the storm of increased costs without significantly impacting their operations or research timelines.

To level the playing field, smaller firms can consider the following strategic moves:

1. Reshoring Key Elements of the Supply Chain: Smaller firms can reshoring key elements of the supply chain, not entirely, but enough to insulate against shocks. This will require time, partnerships, and likely additional government support beyond the current scope of the CHIPS Act.

2. Deepening Ties with Less Tariff-Affected Regions: In the interim, smaller firms can deepen ties with less tariff-affected regions, such as South Korea and India, for specialized equipment. This strategy can help them avoid the high tariffs imposed on goods from countries like China.

3. Shifting Limited Manufacturing Abroad: Some smaller firms may shift limited manufacturing abroad to avoid import fees altogether, though this poses its own logistical and political risks. This move can help them reduce costs and maintain their research and development timelines.

4. Tighter Collaboration: Smaller firms can work together, sharing parts of the supply chain or co-investing in fabrication access to keep their programs on track. This collaboration can help them pool resources and reduce costs.



In summary, the new tariffs pose significant challenges for quantum computing startups like IonQ and Rigetti Computing, affecting their supply chain and operational costs. However, by reshoring key elements of the supply chain, deepening ties with less tariff-affected regions, and collaborating more closely with other firms, these startups can mitigate some of the challenges and continue to innovate in the quantum computing field.