The work of quantum computing researchers for many years has been motivated by the pursuit of quantum supremacy–the point at which a quantum computer will be able to solve a problem faster than a classical computer, or perhaps even solve a problem that would be nearly impossible for a classical computer to solve.
While it would be worth some hefty bragging rights for most quantum computing start-ups, IonQ CEO Peter Chapman wants his company to be motivated by something else entirely.
“About 18 months ago,” Chapman said on IonQ’s third quarter 2024 earnings call this week, “I challenged our teams to answer a critical question. I told them, 'I don't care about theoretical algorithms with limited practical applicability. I don't care about the academic argument about quantum supremacy.’ Instead, I asked them, 'What are the applications that have the potential to disrupt multibillion dollar industries? The team has since identified several application areas where we believe commercial value will be first realized and aligned with our next generation hardware and IonQ's production capability.”
This more practical–though highly ambitious–business focus has enabled IonQ to make progress on several fronts, including its corporate revenue and its development of commercial quantum computing applications. The College Park, Maryland, company this week marked its latest achievements in those areas, reporting more than 100% year-over-year growth in revenue to $12.4 million for the third quarter of 2024, new application-focused partnerships, and even a corporate acquisition that could pay off further down the road.
In addition to the revenue increase, which was slightly above IonQ’s guidance for the quarter, the company raised its full-year 2024 revenue guidance to between $38.5 million and $42.5 million. The company also posted $63.5 million in bookings for the quarter. On the down side, increasing operating costs helped drive the company toward a net loss of $52.5 million in the third quarter compared to $44.8 million in the prior year period, but the higher loss fits the pattern of a start-up still investing in R&D, staff, and elsewhere in its push to grow revenue.
As for IonQ’s chase effort to identify and pursue commercial quantum computing applications, it has resulted in two new partnerships. Chapman said the first two application areas prioritized by the company are biopharmaceutical drug discovery and computer-aided simulations for the engineering and manufacturing industries.
Regarding the former, IonQ during its earnings report announced a collaboration with biopharmaceutical giant AstraZeneca to create a new quantum application development center in Gothenburg, Sweden, where IonQ quantum experts and AstraZeneca scientists will work together to develop new applications. Meanwhile, in the computer-aided engineering field, IonQ has partnered with engineering software firm Ansys to “accelerate simulations, expand high-fidelity design exploration and reduce product development timelines enabling faster market entry for more innovative products,” Chapman said. The partners will be integrating Ansys’ software and IonQ quantum computers.
In more of a long-term bet, IonQ also announced it is acquiring Qubitekk, a California start-up that is a major innovator in the area of quantum networking, which has been viewed as both a way to transit quantum information over distance, and a method for linking quantum computers together to create a more powerful computing resource.
Chapman in previous interviews has discussed IonQ’d desire to invest in quantum networking, and this is the company’s second acquisition in the space after its 2023 purchase of Entangled Networks. Qubitekk supported the deployment of the nation’s first commercially available quantum network in Chattanooga, Tennessee. Chapman during the earnings call noted that consulting firm McKinsey has estimated that quantum communication will become a $36 billion market by 2040.