Is this the next Nvidia… or a trap?

DEEP DIVE

THE QUANTUM QUESTION

THE NEXT NVIDIA, OR THE NEXT MONEY PIT?

Last week we flagged two quantum stocks ripping on pure momentum and told you to size them like the lottery tickets they are.

A few of you wrote back with the same question: is this actually the next Nvidia? Fair question, because the guy who runs Nvidia keeps changing his answer.

So let's go deeper than a watchlist line and actually pull this thing apart, both sides, no cheerleading.

Quantum is one bet on the next world-changing technology. Here's a very different one to learn about...

NVIDIA WAS A GAMING STOCK FOR 20 YEARS

Here's the thing nobody remembers about Nvidia. For most of its life it was a gaming company, building graphics chips so your video games looked better, and that was basically the whole story for about two decades. Wall Street treated it like a decent niche business, not a world-changer.

Then the AI moment hit. The same chips that rendered explosions in video games turned out to be perfect for training AI models, and Nvidia became the most valuable company on the planet. The tech sat there for twenty years waiting for its killer app, and the people who held through the boring decades got rich.

Now the kicker. The person making the quantum-equals-early-Nvidia comparison is Jensen Huang himself, the Nvidia boss.

In January last year he told a room of analysts that genuinely useful quantum computers were probably 15 to 30 years away. The sector fell off a cliff that same day, with Rigetti down about 45%, IonQ around 39%, and roughly $4 billion in value gone in hours.

Two months later he stood on stage at Nvidia's own conference, basically apologized, joked that he didn't even realize these were public companies, and compared quantum to his GPUs, pointing out that Nvidia itself was built on decades of slow research before it ever paid off.

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THE STATE OF PLAY

WHERE THE TECH ACTUALLY IS

In plain English, quantum computers use qubits instead of regular bits. A normal bit is a 1 or a 0. A qubit can be both at once, which lets a quantum machine chew through certain monster problems, like simulating molecules for drug discovery or cracking optimization puzzles, in ways a normal computer never could.

The catch is that qubits are fragile and error-prone, so we're still in what engineers call the noisy era. The machines exist, they're just not reliable enough yet to do the world-changing stuff at scale.

The progress is real, though. Google's Willow chip showed last year that adding more qubits can actually reduce errors instead of multiplying them, which is the holy grail the field has chased for years. That's a genuine breakthrough, not a press release.

On the stock side, four names carry the retail bet, and they trade as one basket (when one runs, they all run). IonQ ($IONQ) is the revenue leader, with last quarter's sales up a wild 755% to about $65 million and full-year guidance lifted toward $265 million. D-Wave ($QBTS) uses a different approach and posted around $33 million in quarterly bookings. Rigetti ($RGTI) builds superconducting chips and did about $4 million in revenue. Quantum Computing Inc ($QUBT) is the photonics bet and the smallest of the four.

THE TAPE (MAY 26 • INTRADAY): Last year the group went vertical, with Rigetti up roughly 545% and D-Wave around 458% on the year. This week the rip is cooling. As of Tuesday's session, Rigetti sits near $25 (down ~4.6%), D-Wave around $28 (down ~6%), and IonQ is holding about $64.

If the lesson is that the obvious frontier name isn't always the winner, here's a partner making exactly that case about another corner of the Elon universe.

IF IT WORKS, IT REALLY WORKS

So could one of these actually be the next Nvidia? It isn't crazy.

If quantum hits its killer app, whether that's drug discovery, new materials, logistics, or breaking today's encryption, the company that owns the standard could be worth a fortune, and early holders would look like geniuses. That's the same dream that paid off for the people who held Nvidia through the dead years.

And the momentum is building, not fading. Nvidia flipped from skeptic to backer, launched its own quantum tooling, and is building a quantum research center in Boston. When the company printing money in AI starts plugging quantum into its ecosystem, the structural odds for these small players go up, because they get a partner and a framework they could never build alone.

The revenue, while tiny, is finally growing fast. IonQ guiding to a quarter-billion in sales is a different conversation than the zero-revenue science projects these were a couple years ago. If you squint, it rhymes with Nvidia around 2006, real product, real customers, and a market that hasn't fully arrived yet.

THE BEAR CASE

WHERE PEOPLE LOSE THEIR SHIRTS

Now the other side, because this is where it gets dangerous.

Most game-changing technologies don't mint a hundred winners, they mint one or two and bury the rest. The internet was completely real and still wiped out almost everyone who bet on it in 1999. Even if quantum is the future, the odds that today's small pure-plays are the names still standing in fifteen years aren't great, especially with Google, IBM, and Microsoft chasing the same goal with infinitely deeper pockets.

Then there's the clock. If useful quantum really is 15 to 20 years out, that's a long time to hold a stock that burns cash and sells new shares to stay alive. That dilution quietly eats your gains while you wait for a payoff that keeps sliding further away.

And the valuations already price in a lot of dreaming. A company doing $4 million in quarterly revenue carrying a multibillion-dollar valuation is running almost entirely on story, and when the mood flips, these names can drop 40% in a single session. They already have, more than once.

YOU DON'T HAVE TO GUESS AT THE VOLATILITY: Even today, with the broader quantum ETF green, Rigetti and D-Wave are each down 4 to 6% on the session, handing back a chunk of last week's pop. That's the trade in a nutshell, violent in both directions.

KEEP READING

Is this the next Nvidia... or a trap?