Billionaires Are Buying This Quantum Computing Stock Hand Over Fist (Hint: It’s Not IonQ or D-Wave Quantum)

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Although not yet prevalent like generative artificial intelligence (AI) stocks, a few quantum computing shares have experienced remarkable growth over the past year. This surge might be due to investors’ growing conviction that quantum computing could be commercially viable sooner than anticipated, or it could be because these quantum computing companies are demonstrating significant advancements.

It’s quite clear that something unusual is happening. For instance, D-Wave Quantum has seen an incredible surge, over 1,700% in the past year alone. Similarly, IonQ has experienced a significant leap, rising by almost 450%. However, despite these remarkable gains, big-time investors are shifting their focus towards a more substantial quantum computing stock.

Billionaires are thinking bigger

It seems that D-Wave and IonQ hold significant promise within the intricate realm of quantum computing. However, it’s crucial for investors to keep in mind that if a groundbreaking technological innovation arises anywhere, it’s highly probable that companies from the esteemed group known as the “Magnificent Seven” will be part of it.

The primary entity behind Google and YouTube, known as Alphabet (GOOGL) (GOOG), has been advancing in the field of quantum computing, making it one of the leading companies in this area. In 2023, Google managed to accomplish a computational task more efficiently than any of the fastest supercomputers available at that time.

I happened upon an intriguing development in the realm of quantum research led by Google’s team. They managed to showcase a significant advancement in reducing errors within computational functions, achieved by augmenting the number of qubits. This finding is remarkable because increasing the number of qubits typically leads to more errors.

Quantum computing’s building blocks are called qubits, similar to how bits serve as the foundation for digital computing. Unlike classical bits which can only be a 0 or a 1, qubits can exist in multiple states simultaneously – a phenomenon known as superposition – enabling them to execute intricate calculations that far surpass the capabilities of conventional computers.

Enhancing the number of quantum bits (qubits) in a system boosts its overall power, yet it also amplifies the occurrence of data errors. The Willow chip’s advanced error correction mechanism might pave the way for robust and dependable quantum computers with streamlined data transmission – on an expansive scale compared to current miniature systems.

There’s still some progress left, but numerous specialists predict that quantum computers will be capable of handling exceptionally challenging computations much more efficiently than even the brightest humans. They will perform complex tasks that could significantly transform various industries, similar to AI’s potential. Notably, Google is working on constructing a 100-qubit quantum computer.

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High-net-worth individuals, such as Israel Englander of Millennium Management, have significantly increased their investment in Alphabet during the first quarter of 2025. Specifically, they raised their long equity position in Alphabet by 151%.

Remember that Millennium operates as a multi-strategy hedge fund, often referred to as a “portfolio shop.” In this setup, investment managers are employed by the company and manage funds using the firm’s capital. However, they have significant freedom in making their investment decisions. This means that Englander might not have personally triggered the buy for Alphabet, but he could have played a role in the decision-making process.

Billionaires such as Ken Griffin, head of multi-strategy hedge fund Citadel Advisers, and David Tepper with his firm Appaloosa Management, boosted their holdings in Alphabet by approximately 10% and 7%, respectively.

Beyond quantum, is Alphabet’s stock a buy?

It seems that these billionaires might be purchasing Alphabet not only for its quantum computing division, but also due to the company’s overall size and promising businesses. While the potential of quantum computing as a new business is undeniable, it’s important to note that many quantum computing companies are currently not generating substantial income because the technology, which hasn’t been fully commercialized yet, is still in its nascent stages.

Instead, investors might consider Alphabet as being discounted, given that its stock is trading around 19 times projected future earnings. The company has encountered some setbacks: the Department of Justice won a lawsuit alleging monopolistic digital advertising practices, and they have requested a federal court to force Alphabet to sell its Chrome search business. Additionally, there are doubts about whether AI chatbots such as ChatGPT or Perplexity could potentially replace search, a sector that accounts for more than half of Alphabet’s total revenue.

Despite the fact that Alphabet is already a large company with well-known entities like YouTube and Google Cloud, it continues to innovate by launching new services such as AI chatbot experiences provided by its Gemini division atop most search results. Moreover, there are several promising sectors within Alphabet, including quantum computing, chip manufacturing, and autonomous driving through Waymo, which are all on the rise.

Although Alphabet encounters difficulties, I have a strong feeling they’ll skillfully steer through these rough seas and reach success on the other side.

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2025-07-22 17:44