Insider Brief
- IonQ reported third-quarter revenue of $12.4 million, a 102% increase year-over-year, and raised its full-year revenue forecast to between $38.5 million and $42.5 million. Net loss for the quarter was $52.5 million.
- The company secured a $54.5 million contract with the U.S. Air Force Research Lab to advance quantum networking, a $9 million partnership with the University of Maryland, and entered strategic collaborations with AstraZeneca and Ansys to expand quantum applications in drug discovery and engineering.
- IonQ signed an agreement to acquire quantum networking company Qubitekk, achieved remote ion-ion entanglement for quantum communication scaling, and partnered with NKT Photonics and imec to enhance its quantum hardware capabilities.
IonQ (NYSE: IONQ) announced yesterday that its third-quarter earnings exceeded earlier guidance, reporting $12.4 million in revenue, according to a company statement.
This figure represents a more than double — 102% — increase over the same period last year, reflecting growing demand for quantum technology solutions. Citing strong momentum, IonQ raised its full-year revenue expectations to between $38.5 million and $42.5 million, up from prior forecasts, positioning the company to close out the year on a high note as it pursues a range of strategic partnerships and government-backed projects.
The company reported new bookings for the quarter, driven by a large contract with the U.S. Air Force Research Laboratory (AFRL) aimed at developing quantum networking capabilities.
“We had yet another banner quarter at IonQ, booking $63.5 million and exceeding the high end of our revenue range. We won a $54.5 million deal with the United States Air Force Research Lab (AFRL) to develop and deliver hardware that enables the scaling and networking of quantum systems,” said Peter Chapman, President and CEO of IonQ, in the statement. “We have entered a new era of commercialization for quantum networking, as demonstrated by the AFRL deal, today’s announcement of the Qubitekk acquisition, and last quarter’s networking win with ARLIS. These announcements advance our position as a market leader in quantum networking, in addition to our pole position in quantum computing.”
This AFRL deal, IonQ’s largest single contract for the year, will fund projects over the next four years focused on advancing scalable and deployable quantum systems that could ultimately integrate with existing telecommunications networks, according to the statement. The AFRL contract represents IonQ’s third engagement with the lab and signals increased government interest in supporting quantum technologies, especially those with potential applications in defense and secure communications.
Qubitekk Acquisition
To expand its footprint in quantum networking, IonQ has signed a definitive agreement to acquire Qubitekk, a quantum networking company based in Vista, California. The acquisition, expected to close within six months, includes Qubitekk’s intellectual property portfolio of 118 U.S. and international patents in quantum network security, as well as its customer base and core technology assets. This acquisition underscores IonQ’s strategy to bolster its offerings in quantum communications, a field seen as integral to the future of secure data transmission and one with potential applications in both commercial and government sectors.
IonQ CEO Peter Chapman said that this acquisition will position IonQ as a leading player in the emerging quantum networking market, which has received substantial government support as part of broader federal investments in quantum research. The statement suggests that IonQ aims to leverage Qubitekk’s patents and existing projects to advance both its commercial and governmental initiatives in the sector.
Collaborations to Broaden Quantum Applications in Industry
In addition to its government contracts and acquisitions, IonQ has announced significant partnerships aimed at expanding quantum computing’s role in various industries. The company has forged a partnership with pharmaceutical giant AstraZeneca to develop quantum applications for drug discovery, marking IonQ’s first collaboration focused explicitly on a production-level use case in the healthcare sector. This project will take place at AstraZeneca’s BioVentureHub in Gothenburg, Sweden, where IonQ’s quantum technology will be integrated with AstraZeneca’s computational resources to accelerate research into new therapeutics.
The AstraZeneca partnership highlights the potential for quantum computing to address complex molecular structures and chemical interactions that are often computationally prohibitive for classical computers.
Chapman said: “For the first time in IonQ’s history, we are announcing a plan to partner on the development of quantum applications for a production use case with AstraZeneca,” said Chapman. “We believe this monumental collaboration will be the first step to validate the years of pioneering research we have conducted in quantum chemistry.”
The company believes that this engagement will lead to valuable applications in drug discovery and pharmaceutical development.
Ansys Partnership
Furthering its industry reach, IonQ has entered a partnership with Ansys, a leader in engineering simulation software, to integrate quantum computing into the computer-aided engineering (CAE) industry. This alliance would work to improve product design and testing processes by harnessing IonQ’s quantum systems to enhance simulation fidelity and accelerate development timelines.
As part of this initiative, Ansys software will be compatible with IonQ’s quantum infrastructure, making it accessible to both quantum experts and those less familiar with the technology, potentially broadening the user base for quantum-enhanced simulations in areas like aerodynamics, structural integrity, and materials science.
Academic and Technical Partnerships to Drive Quantum Innovation
On the academic front, IonQ secured a $9 million agreement with the University of Maryland (UMD) to extend their partnership at the National Quantum Lab (QLab). This initiative will provide UMD’s students, faculty, and researchers direct access to IonQ’s leading trapped-ion quantum computers, creating a collaborative environment aimed at fostering quantum research and innovation. The agreement strengthens IonQ’s ties to UMD, a longtime partner and key collaborator in IonQ’s research pipeline, as both institutions work to accelerate advancements in quantum computing technology.
Technical milestones also marked the quarter, with IonQ achieving an advance in remote ion-ion entanglement, a critical step for scaling quantum networks. The company developed a method to entangle ions at separate locations, laying the groundwork for long-distance quantum communication—a foundational capability for developing scalable, secure quantum networks. Remote entanglement is part of a four-step roadmap IonQ is following to enable photonic interconnects, which could help achieve high-speed, high-fidelity quantum communication between distant nodes, a requirement for both robust quantum networks and distributed quantum computing.
In a related move to enhance its technological foundation, IonQ has partnered with NKT Photonics to co-develop laser systems for future quantum computers. These lasers will be integrated into IonQ’s planned data center-ready systems, such as its Tempo line and barium-based quantum computers. Additionally, the company has engaged with imec, a Belgium-based R&D center specializing in nanoelectronics, to work on photonic integrated circuits and chip-scale ion trap technology, aiming to reduce quantum hardware’s size and cost, while increasing its scalability and processing power.
Financial Performance and Revised Guidance
While reporting a net loss, IonQ’s financial results showed gaining momentum. Despite the positive revenue results, the company reported a net loss of $52.5 million, with an adjusted EBITDA loss of $23.7 million, factoring out a non-cash loss of $3.9 million related to warrant liabilities.
The company’s cash reserves remain strong at $382.8 million, providing financial stability as IonQ pursues long-term development goals in quantum computing and networking.
Based on its recent performance and ongoing contract pipeline, IonQ raised its 2024 revenue forecast to between $38.5 million and $42.5 million. Additionally, the company reaffirmed its bookings target of $75 million to $95 million for the year.
