Quantum computing company IonQ announced Monday that it will acquire quantum systems developer Oxford Ionics in a mostly stock deal valued at $1.07 billion.
The acquisition comes amid a sizzling period for the quantum computing space. Over the past year, the sector has seen steeply rising stock prices among publicly traded companies, a succession of breakthroughs, and continued strong startup investment.
Per College Park, Maryland-based IonQ, this latest megadeal is mostly about keeping its technology cutting edge. Though just six years old, U.K.-based Oxford Ionics is known for its research prowess. The company said it holds world records in multiple key metrics for quantum performance.
Oxford Ionics has also been a favorite among startup investors, previously raising $53 million in known venture and grant funding. Its lead venture backers include Oxford Science Enterprises and Braavos Investment Advisors.
Ten-year-old IonQ describes itself as a specialist in quantum computing and networking, developing high performance systems based on trapped ion technology. Founded in 2015, it went public in October 2021 via a SPAC merger.
Unlike most post-SPAC mergers, IonQ shares didn’t plummet in subsequent months. However, the stock didn’t really take off until late last year, with the company recently boasting a market cap around $10 billion.
Quantum takes off
The deal comes on the heels of sharp gains on the public markets for the quantum computing space. Shares of publicly listed companies in the sector, including IonQ, Rigetti Computing and Quantum Computing, began taking off last fall and posted multifold gains by the end of the year.
Investor enthusiasm has extended to the venture capital arena as well. In 2024, startups in the quantum computing space raised $1.94 billion, per Crunchbase data, up 143% from the prior year.
Big rounds accumulated at a steady clip, including:
So far this year, the startup investment pace has remained brisk, with $1.1 billion invested across 39 known rounds. Just last week, Infleqtion, a developer of atom-based quantum systems for sensing and computing applications, raised $100 million in a Series C backed by Glynn Capital Management, Morgan Stanley’s Counterpoint Global, S32 and SAIC.
The surge in funding for quantum startups was likely spurred on by big breakthroughs by companies including Google and IBM last year. Those milestones show no signs of stopping — just this year, Microsoft said it had created a new state of matter in its quest to make an extremely powerful machine — what it’s calling a “topological qubit” based on a new physical composition.
The rise of AI is another contributing factor, with quantum computing poised to help with the technology’s massive computing needs and energy consumption.
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Illustration: Dom Guzman
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