What Happened?
Shares of quantum computing company IonQ (NYSE:IONQ) jumped 5.3% in the afternoon session after the company announced the formation of IonQ Federal, a new division dedicated to serving the U.S. government and its allies.
The new initiative aims to unify and expand IonQ's quantum computing and networking services for national security and defense sectors. To lead this strategic push, the company appointed Robert Cardillo, the former director of the National Geospatial-Intelligence Agency, as the division's Executive Chairman. This move builds upon IonQ's existing relationships with government entities, which already include over $100 million in contracts with agencies like the United States Air Force Research Lab and DARPA. The formation of a dedicated federal division is a significant step, signaling a deeper commitment to securing government contracts, which can provide a stable revenue base while validating its quantum technology for mission-critical applications.
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What Is The Market Telling Us
IonQ’s shares are extremely volatile and have had 104 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 7 days ago when the stock gained 3.1% on the news that the company announced a significant technological breakthrough, while the broader quantum computing sector received a boost from a major investment.
IonQ revealed a breakthrough in creating high-quality, quantum-grade diamond films in collaboration with Element Six, a De Beers Group company. This advancement allows key components for quantum networks to be made using standard semiconductor manufacturing, which is expected to accelerate the production of scalable, fault-tolerant quantum systems.
Adding to the positive sentiment, the entire quantum computing sector gained momentum after Nvidia participated in a funding round for competitor Quantinuum. Investors appear to view Nvidia's involvement as a validation of the industry's potential. Furthermore, IonQ also announced the appointment of Inder M. Singh, the former CFO of Arm, as its new Chief Financial Officer and Chief Operating Officer.
IonQ is up 8.9% since the beginning of the year, and at $46.94 per share, it is trading close to its 52-week high of $51.07 from January 2025. Investors who bought $1,000 worth of IonQ’s shares at the IPO in January 2021 would now be looking at an investment worth $4,347.
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