Valued at a market capitalization of $6 billion, IonQ (IONQ) develops and operates quantum computing systems. It offers cloud-based access to advanced quantum computers through major platforms like those of Amazon (AMZN), Microsoft (MSFT), and Google (GOOGL).
IonQ continues to strengthen its position in the quantum computing sector, bagging a $21.1 million project with the United States Air Force Research Lab (AFRL). This adds to the company’s growing portfolio of government contracts. In September 2024, IonQ inked another $54.5 million agreement with AFRL.
The new project focuses on installing quantum network infrastructure at the Innovare Advancement Center in New York. IonQ will develop high-performing network access points, deliver networking hardware compatible with existing telecommunications infrastructure, and work on capabilities for free-space optical links between ground stations and uncrewed aerial systems.
IonQ Stock Is Down 45% From All-Time Highs
After rallying around 400% in 2024, IONQ stock currently trades 45% below all-time highs. The ongoing decline can be attributed to two major industry leaders casting doubt on quantum computing’s near-term potential.
Nvidia (NVDA) CEO Jensen Huang suggested useful quantum computers are 15-30 years away from reality. His comments triggered a broad selloff across quantum computing stocks, with IonQ dropping 39% on Jan. 10. Meta (META) CEO Mark Zuckerberg echoed similar sentiments on Joe Rogan’s podcast, stating quantum computing applications are likely a “decade-plus out,” further pressuring the sector. IONQ shares shed another 13.8% on Monday, Jan. 13.
Both statements led investors to reassess the timeline for practical quantum computing applications, though industry experts like AXS Investments’ CEO Greg Bassuk consider the market reaction "overblown.”
Earlier this year, IonQ CEO Peter Chapman highlighted the company’s progress and ambitious roadmap. Chapman emphasized that while classical computing faces inherent limitations, IonQ’s current Forte Enterprise systems (#AQ 36) are already delivering customer solutions.
Chapman pointed to the broader industry momentum, citing that the quantum computing sector has already attracted more than $50 billion in investments to date. He specifically highlighted quantum AI as a key area where quantum computing could surpass classical systems, and emphasized IonQ’s leadership in quantum networking for secure communications.
Looking ahead, Chapman projected that IonQ would end 2030 with $1 billion in sales and turn profitable by the end of the decade.
What Is the Target Price for IONQ Stock?
Wall Street estimates IonQ will increase sales from $22 million in 2023 to $90 million in 2025. The quantum computing company remains unprofitable, reporting a free cash outflow of $113 million in the past year. It ended the third quarter of 2024 with $382.2 million in cash, providing it with enough flexibility to fuel its cash burn rate over the next 24 months.
Priced at 67x forward sales, IonQ trades at a premium. It may have to raise capital several times over the next decade to support expansion plans and gain an early mover advantage, which would then dilute existing shareholders.
Out of the five analysts tracking IONQ stock, two recommend “Strong Buy,” one recommends “Moderate Buy,” and two recommend “Hold.” The average target price for IONQ stock is $26, which is below the current trading price near $29.
