In this article, we will take a look at the 10 quantum computing stocks billionaires are purchasing. If you want to skip our detailed analysis of the industry and its growth prospects, go to the 5 Quantum Computing Stocks Billionaires Are Loading Up On.
As reported in one of our articles earlier, the size of the quantum computing industry is expected to grow from $10.13 billion in 2022 to $125 billion by the end of this decade, reflecting an annual average growth rate of nearly 36.9%. To achieve long-term comparative growth, leading North American technology companies like Microsoft Corporation (NASDAQ:MSFT), Alphabet Inc. (NASDAQ:GOOGL), and Amazon.com, Inc. (NASDAQ:AMZN) are making substantial investments in the field. Recognizing the immense potential of quantum technology, the Chinese government has also allocated a substantial budget of $10 billion for the research and development of quantum technologies. In addition to the tech giants, pure-play companies like Rigetti Computing, Inc. (NASDAQ:RGTI) and Quantum Corporation (NASDAQ:QMCO) are notable players in the sector and among the leading quantum computing penny stocks.
Quantum computing has attracted the attention of countries beyond North America and China, including India. The Indian government announced in February 2020 that it intends to invest $1.12 billion in quantum computing over the next five years. For a country like India, which is heavily dependent on its agricultural output, quantum computing can help address optimization challenges such as crop yield optimization, supply chain management, and resource allocation within the agricultural sector. In addition to agriculture, quantum computing also has the potential to impact the banking sector. International Business Machines Corporation (NYSE:IBM), one of the top quantum computing companies, believes that quantum computing can increase the share of wallets from existing customers and help reach 1.7 billion adults who are presently unbanked.
Transformative Impact of Quantum Computing
The impact of quantum computing extends to the field of medical research and healthcare as well. Quantum computing can accurately model complex biological systems, such as protein folding, and enable scientists to design and optimize drugs more efficiently. According to Markets and Markets, the size of quantum computing in the healthcare sector is expected to expand at a compound annual growth rate (CAGR) of 42.5%, from $85 million in 2023 to $503 million in 2028. In April, Moderna, Inc. (NASDAQ:MRNA) announced that it had partnered with International Business Machines Corporation (NYSE:IBM) to gain access to the company’s quantum computing system. By leveraging the power of quantum computing, Moderna, Inc. (NASDAQ:MRNA) aims to accelerate the development of mRNA technology. While announcing the partnership, Moderna CEO Stephane Bancel also stressed the importance of preparing for the era of quantum computing and recognized the transformative impact it can have on various industries.
Experts believe that the growth outlook of the quantum computing industry depends on the expansion of quantum computing as a service (QCaaS). The service aspect of the quantum computing industry can play an integral role in numerous other sectors like chemicals, defence, and finance. Quantum Computing as a Service (QCaaS) is a cloud-based platform that allows users to access and utilize quantum computing resources over the internet. It provides a way for individuals and organizations to harness the power of quantum computers without having to build and maintain their quantum hardware infrastructure. According to research conducted by a subsidiary of the Quantum Daily, the size of the QCaaS industry is set to grow from an expected $4 billion in 2025 to $26 billion by 2030. Overall, the industry is set to experience a CAGR of 80% from 2021 to 2030. The positive growth prospects have resulted in many investors being bullish on the best quantum computing stocks.
10 Quantum Computing Stocks Billionaires Are Loading Up On
We used Insider Monkey’s database of billionaire-owned stocks to shortlist the best quantum computing stocks that attracted the highest number of billionaire investors during Q1 2023. The list includes leading tech companies with significant exposure to the quantum computing industry. The best quantum computing stocks have been ranked in ascending order of the number of billionaires holding a stake in them. We have also included information regarding the total number of hedge fund investors in these companies as of the first quarter of the year.
Quantum Computing Stocks Billionaires Are Loading Up On
Dollar Value of Billionaire Holdings: $351,752,613
Number of Hedge Fund Holders: 43
Baidu, Inc. (NASDAQ:BIDU) is a Beijing, China-based leading AI company. As of Q1 2023, 11 billionaires reported owning a stake worth over $351.7 million in Baidu, Inc. (NASDAQ:BIDU). The company is at the tenth position on our list of the best quantum computing stocks billionaires are purchasing.
In 2022, Baidu, Inc. (NASDAQ:BIDU) revealed its first superconducting quantum computer, Qian Shi. The system supports a wide range of practical quantum applications, such as designing advanced lithium batteries through its 10 high-fidelity quantum bits (qubits). Furthermore, Baidu, Inc. (NASDAQ:BIDU) has made significant progress in quantum chip development, completing the design of a 36-qubit superconducting quantum chip.
Here's what Ariel Investments said about Baidu, Inc. (NASDAQ:BIDU) in its Q1 2023 investor letter:
“China’s internet search and online community leader, Baidu, Inc. (NASDAQ:BIDU) was the top contributor in the quarter. Shares traded higher following the announcement Baidu plans to launch an AI chatbot similar to ChatGPT. While some investors remain on the sidelines due to uncertainty surrounding Covid, China’s economic growth, and the political rhetoric towards Taiwan, we remain enthusiastic about Baidu’s longer-term opportunity for revenue growth and margin expansion across internet search, cloud, autonomous driving, artificial intelligence and online video.”
9. International Business Machines Corporation (NYSE:IBM)
Number of Billionaire Investors: 12
Dollar Value of Billionaire Holdings: $509,010,401
Number of Hedge Fund Holders: 49
International Business Machines Corporation (NYSE:IBM) is an Armonk, New York-based technology company that has made significant contributions to the field and has built a quantum computing platform called IBM Quantum Experience. The platform allows researchers and developers to experiment with quantum circuits and algorithms.
On June 6, International Business Machines Corporation (NYSE:IBM) announced that it intends to open a quantum computing data centre in Germany. The facility is expected to become online in 2024 and will allow European Union (EU) organizations to leverage IBM's quantum cloud services without the need to send the data to the US.
Diamond Hill Capital shared its stance on one of the best quantum computing stocks in its Q4 2022 investor letter. Here's what the firm said:
“New positions initiated in Q4 included shorts International Business Machines Corporation (NYSE:IBM), Acushnet Holdings (GOLF) and elf Beauty (ELF). Since diversified information technology company IBM’s 2019 acquisition of Red Hat, the company has aggressively pursued a hybrid cloud strategy. Though IBM and its new management team have made solid progress on this pivot, we believe the company still meaningfully lags the cloud hyperscalers and other cloud-native companies. Management has also laid out aggressive long-term targets for revenue growth and free cash flow, both of which we believe the company will struggle to achieve as it faces intense competition in its hybrid cloud business and structural headwinds in the company’s legacy businesses.”
Dollar Value of Billionaire Holdings: $2,081,425,917
Number of Hedge Fund Holders: 68
Intel Corporation (NASDAQ:INTC) has been considered a pioneer in the classical computing industry through its semiconductor manufacturing capabilities. The company is now also playing an important part in the quantum computing industry, justifying its inclusion in our list of the best quantum computing stocks billionaires are purchasing.
Intel Corporation (NASDAQ:INTC) has launched the second generation of the Horse Ridge cryogenic control chip that aims to overcome the challenge of scalability for quantum computing systems. The Santa Clara, California-based company launched the trial version of the Intel Quantum Software Development Kit in September 2022, which will be operable with the Horse Ridge chip.
ClearBridge Investments shared its stance on Intel Corporation (NASDAQ:INTC) in its Q4 2022 investor letter. Here’s what the firm said:
“A third approach to return generation is purchasing idiosyncratic businesses that largely control their own destiny. Intel Corporation (NASDAQ:INTC), which we purchased in the first quarter on the premise that it would develop a leading domestic foundry business, has struggled with execution missteps and product delays. We are maintaining the position to provide ongoing exposure to semiconductors.”
Dollar Value of Billionaire Holdings: $954,845,639
Number of Hedge Fund Holders: 58
Lockheed Martin Corporation (NYSE:LMT) has secured the seventh position on our list of the best quantum computing stocks attracting billionaire investors as of Q1 2023.
Lockheed Martin Corporation (NYSE:LMT) has partnered with USC in establishing the Quantum Computing Center (QCC) in USC's Information Sciences Institute. Members of the faculty and students are conducting research into different aspects of noisy, intermediate-scale quantum (NISQ) computing devices. The venture capital division of Lockheed Martin Corporation (NYSE:LMT) also invested in College Park, Maryland-based quantum computing hardware and software company IonQ, Inc. (NYSE:IONQ) before it went public in October 2021.
Two Sigma Advisors held a stake worth over $954.8 million in Lockheed Martin Corporation (NYSE:LMT) as of Q1 2023.
Dollar Value of Billionaire Holdings: $1,558,435,456
Number of Hedge Fund Holders: 58
Honeywell International Inc. (NASDAQ:HON) has a quantum computing division called Honeywell Quantum Solutions. The division is focused on developing and commercializing quantum computing technologies.
Honeywell International Inc. (NASDAQ:HON) thinks that commercial quantum computing will become a $1 trillion industry in the coming decades. The entity has a headcount of over 400 employees and has offices in Europe, Japan, the UK, and the US. The London, UK-based HSBC bank has also partnered with Honeywell International Inc. (NASDAQ:HON). The deal intends to focus on using the power of quantum computing to analyze the customer data of HSBC more minutely.
Of the 943 hedge funds in Insider Monkey’s database, 58 funds held a stake in Honeywell International Inc. (NASDAQ:HON) as of Q1 2023. In addition to Honeywell International Inc. (NASDAQ:HON), Alphabet Inc. (NASDAQ:GOOGL), Microsoft Corporation (NASDAQ:MSFT), and Amazon.com, Inc. (NASDAQ:AMZN) are also some of the best quantum computing stocks to buy.