Quantum Computing: Tech’s Next Giant Leap?

March 25, 2025

0 3 minutes read

(2:00) – Key Takeaways From Nvidia GTC 2025
(6:50) – What To Learn From Nvidia’s Quantum Day Events
(13:30) – What Investors Need To Know About D-wave Quantum Computing
(19:00) – What Exactly Is Quantum Computing And What Are The Recent Developments?
(30:30) – What Impact Will Quantum Computing Have On AI?
(35:00) – Where Should Investors Look To Gain Exposure To Quantum Computing?
(41:10) – Episode Roundup: QUBT, QBTS, AONQ, RGTI, QTUM
Podcast@Zacks.com

In this episode of ETF Spotlight, I speak with Zacks Senior Stock Strategist Kevin Cook about quantum computing. Quantum stocks have been in focus lately as investors speculate on the next big thing in tech after AI.

NVIDIA’s Quantum Day & Jensen’s Mea Culpa

NVIDIA NVDA held its first-ever Quantum Day at GTC 2025 last week, where CEO Jensen Huang announced the launch of its Accelerated Quantum Research Center, set to begin operations later this year.

In January, quantum computing stocks plunged after Jensen predicted that useful quantum computers were still 15–20 years away.

D-Wave QBTS, whose CEO had publicly challenged Jensen’s comments, claimed to have achieved “quantum supremacy.” The company specializes in quantum annealing, which is particularly effective for applications like materials simulation.

D-Wave demonstrated that its latest quantum machine simulated a complex magnetic material in just 20 minutes—potentially the first practical application of quantum computing, with significant implications for industrial material development. However, some physicists dispute this claim.

Microsoft & Amazon Tout Their Chips After Google’s Willow

Microsoft MSFT recently unveiled Majorana 1, the world’s first quantum processor powered by topological qubits. CEO Satya Nadella believes Majorana will enable the creation of a truly meaningful quantum computer not in decades, but in years.

Topological qubits are exceptionally fast, digitally controllable, and scalable. Microsoft claims that these qubits can be integrated into a single chip—small enough to fit in the palm of one’s hand—yet capable of scaling to a million qubits.

Just a week after Microsoft’s announcement, Amazon AMZN introduced its prototype, Ocelot, which employs a new approach to quantum error correction by leveraging specialized quantum bits called “cat qubits.”

Earlier in December, Google GOOG revealed that its new computer chip, Willow, can perform calculations in under five minutes that would take one of the world’s most powerful supercomputers almost an eternity.

What is Quantum Computing?

Traditional computers use binary digits, or bits, which can represent only 0 or 1.

Quantum computers, on the other hand, use quantum bits, or qubits.

Qubits leverage quantum effects such as superposition, where particles can exist in multiple states simultaneously, and entanglement, where particles remain interconnected even when physically separated.

Thanks to these properties, quantum computers can process information at exponentially faster rates than classical computers, with the potential to revolutionize numerous industries.

However, qubits are fragile and can maintain their quantum states for only tiny fractions of a second, meaning any information they store is quickly lost. Additionally, they must be kept at extremely cold temperatures.

How to Invest in the Theme

Some of the world’s largest tech companies—including Microsoft, NVIDIA, Amazon, and IBM—along with many startups, are actively developing quantum computers or advancing quantum technologies. Governments worldwide are also investing billions in this sector.

Smaller pure-play quantum companies like Rigetti Computing RGTI, D-Wave Quantum QBTS, and IonQ IONQ had seen their stock prices skyrocket following Google’s announcement. However, these companies may not be profitable anytime soon, and their shares tend to trade largely on headlines.

In his report—Beyond AI: The Quantum Leap in Computing Power—Kevin explains why NVIDIA is his top pick for capitalizing on this theme. He also wanted me to let you know that he forgot to mention that while many quantum computing technologies rely on ultra-low temperatures for superconducting operations, IonQ’s trapped-ion platform operates at room temperature and is rack-based, similar to classical computing. CEO Peter Chapman described it as: ‘We still use a classical computer… it’s just a quantum chip at the center.”

Since it’s too early to predict winners, a diversified approach via ETFs makes sense. The Defiance Quantum ETF QTUM invests in the global quantum computing and machine learning industries.

Tune in to the podcast to learn more.

Make sure to be on the lookout for the next edition of the ETF Spotlight and remember to subscribe! If you have any comments or questions, please email podcast@zacks.com.

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