Quantum computing stocks like IonQ, Rigetti Computing, D-Wave Quantum, and Quantum Computing were each down by more than a whopping 40% after Nvidia chief Jensen Huang’s comments that he did not expect quantum computers to be a reality any time soon.
IonQ (IONQ) was down by 43.17%, Rigetti Computing (RGTI) by 46.25%, D-Wave Quantum (QBTS) by 47.70%, and Quantum Computing QUBT) by 46.14%.
“If you kind of said 15 years for very useful quantum computers, that would probably be on the early side. If you said 30, it’s probably on the late side,” Huang said in a Q&A session during Nvidia’s analyst day event.
“If you picked 20, I think a whole bunch of us would believe it,” he said.
Huang however also said he believes Nvidia will play a “very significant part” in creating the computers and helping the industry “get there as fast as possible.”
The sharp fall contrasted with the rally that some of these stocks like Rigetti, enjoyed last year with investors flocking to quantum computing stocks hoping for them to be the next big thing in the tech and computing space since the rise of AI.
The stocks received a fillip towards the end of 2024, with the launch of Alphabet’s quantum computing chip Willow.
Despite factoring in Wednesday’s fall, RGTI is up by more than 743% in a year, while IonQ is up by more than 127.5%.
D-Wave Quantum is up by 462.5% in a year while Quantum Computing (QUBT) is up by a whopping 915% in a year.
Quantum computing harnesses the principles of quantum mechanics to solve complex problems much more quickly than traditional computers.
Should you buy the dip on RGTI?
Analysts say the early-stage nature of quantum computing investments means the stocks in this space are volatile but hold long-term promise as the technology evolves.
“Shares in each of these quantum-related stocks have been trading near, or at, their respective all-time highs. The fast, aggressive and parabolic rally in these stocks called for a “healthy correction” from their lofty values, they just needed a trigger,” Chris Johnson, a seasoned equity and options analyst said.
“In this case, Jensen Huang’s well-timed comments served well for that purpose,” he added.
For Rigetti, Johnson said its 84-qubit Ankaa-3 processor, accessible via its Quantum Cloud Services (QCS) platform, highlights the company’s operational readiness.
At the same time, integration with Amazon Braket and Microsoft Azure by 2025 aims to expand its reach.
He said while Rigetti stock surged into “overbought” territory before the Nvidia comments, the sharp 45% decline brought its price closer to foundational support levels.
Analysts expect further drops to $7.50 or even $5 before investors “buy the dip.”
The stock’s movement reflects technical resistance at round numbers like $10, signaling volatility typical of early-stage growth companies.
Long-term prospects remain intact, as Rigetti offers an operational platform for businesses exploring quantum solutions, Johnson said.
What about IonQ and D-Wave?
For IonQ too, the sell-off could present a value opportunity for patient investors.
Analysts recommend waiting for market stabilization before re-entering, with expectations that IonQ shares might stabilize around the $36 level.
“This is probably going to end up being a buying opportunity, but you certainly don’t jump in right here. You wait for the market to stabilize,” Christopher Lewis, analyst at FX Empire, said.
For D-Wave Quantum analysts suggest monitoring its proximity to the 50-day EMA for signs of recovery.
This company’s shares have demonstrated extreme volatility, recently swinging from $1.50 to $11.50 in just a few weeks.
The recent correction was seen as overdue, with Nvidia’s comments acting as a trigger.
Forecast for quantum computing stocks
The momentum behind quantum computing stocks shows no signs of slowing down.
“It’s hard to put the “Genie” back in the bottle when it comes to investing,” Johnson said.
While the technology is still in its infancy, ongoing advancements will deliver meaningful products and services that support both short-term market interest and long-term investment strategies.
Investors need to keep in mind that quantum computing remains a nascent industry.
As the field evolves, some companies will emerge as leaders, while others may falter.
Navigating this period requires careful risk assessment and a long-term perspective when considering new positions in these stocks.
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