Quantum mechanics has the potential to unlock the next stage in modern computing, allowing scientists to harness the complex physics of subatomic particles to develop advanced computing systems.
In particular, matter has properties of both particles and waves. Quantum computing exploits this behavior using specialized hardware. Furthermore, unlike classical computing, where information has two states, 0 and 1, in quantum computing we have qubits, which can be in either 0 or 1 states, as well as both states simultaneously through superposition.
Quantum computers can help with encryption, optimization, and finding solutions to probabilistic problems. The rise of generative artificial intelligence has created optimism about the potential of quantum computing systems, causing certain quantum computing stocks to soar.
But there are some quantum computing stocks that investors should sell before 2025.
Quantum Computing (QUBT)
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Founded in 2018, Quantum Computing (NASDAQ:QUBT) or “QCi” is a pure play startup focused on designing affordable quantum systems. The quantum computing startup has spent years developing QCi, its core technology that harnesses the versatility of light and its quantum mechanical properties for a variety of applications.
Additionally, QCi’s Dirac systems make up many of the company’s affordable quantum computing products, and these systems are portable and low power.
Unfortunately for investors looking to place a bet on the promising quantum computing company, QCi is technically a penny stock, trading at $0.70.
The stock is not only less liquid than its larger cap peers, but it is also highly volatile. While penny stock traders would likely enjoy trading a stock like QUBT, it’s hard to recommend holding it for the long term, as the company has not shown any sustainable earnings growth over the years.
QCi shares are down 20% year to date, but there may have been waves of volatility where speculative investors made short-term profits. Overall, if you’re a long-term investor, it’s probably not worth holding QCi beyond 2024.
Rigetti Computing (RGTI)
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Rigetti Computing (NASDAQ:RGTI) is a vertically integrated quantum computing startup that has made great strides in a fast-growing field. The company is focused on developing quantum processors that will be used in real quantum computing systems.
In Q2 FY24, Rigetti revealed that it had achieved “99.3% median two-qubit gate fidelity” on its nine-qubit Ankaa quantum processor, an achievement that gives Rigetti confidence that it can achieve similar fidelity on its larger, 84-qubit Ankaa-3 system, scheduled to be delivered later this year.
From there, Rigetti will work on building the 336-qubit Lyra.
The macroeconomic environment puts Righetti in a complicated position: its revenues for fiscal year 2023 have declined for the first time in a long time.
Notably, revenue, at $12 million, was down more than 8% from fiscal year 2022. RGTI stock is also trading just above $1.00, making it more volatile than it’s worth for long-term investors.
D-Wave Quantum (QBTS)
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D-Wave Quantum (NYSE:QBTS) is the final quantum computing stock investors should avoid through 2025. D-Wave’s Advantage system is aimed at businesses, not labs or institutions.
The company says its latest Advantage system features a new processor architecture with more than 5,000 qubits and 15-way qubit connectivity.
Additionally, D-Wave will enable real-time access to its Advantage quantum computers via its “Leap” quantum cloud service.
The idea of using cloud computing platforms to deliver quantum computing power is not new, as many quantum computing companies are looking to improve the scalability of quantum computing hardware.
D-Wave Quantum has performed better financially than many of its competitors, steadily growing sales in recent years, but losses are another story.
As D-Wave continues to develop new quantum systems, its net losses continue to grow.
The reason D-Wave is a quantum computing stock to sell by 2025 is because its stock price of $0.98 per share is volatile for long-term investors.
As of the date of publication, Tyrik Torres did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com’s publication guidelines.
On the date of publication, the editor in charge did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
Tyrik Torres has been studying and participating in financial markets since his college days. He is particularly passionate about helping people understand complex systems. His areas of expertise are semiconductor and enterprise software equities. He has work experience in both investing (public and private markets) and investment banking.
