$IONQ: #3 The Good and the Bad

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The Good‌ 👍

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Good 1: Technology

- IonQ is moving towards Barium-based system which has higher fidelity (performance)

- Developed rack-mounted systems for data centre installations

- Developed room-temperature system (lower operating cost compared to superconducting systems)

- Demonstrated faster QPU gate speeds (which is a great improvement for ion trap systems)

Good 2: Supply Chain

IonQ has partnered with:

- PNNL to secure a sustainable supply of barium qubits

- NKH photonics and IDQ (acquired) for QC parts

Good 3: Partnership and Network

IonQ has partnered with 

- Dell, Nvidia (hybrid quantum computing) 

- Institutions/companies in EU (Quantum Basel), EMEA and South Korea (SK Telecom). 

- University of Maryland (access to research and government contracts)

Good 4: Government Support

US has National Quantum Initiative to promote the growth of quantum computing industry and IonQ stands to benefit from it.

‌Good 5: Acquisitions

In line with their strategy to dominate the quantum networking market, they've acquired 

- Entangled Networks (2023)

- Qubitekk (2024)

- IDQ (in 2025)

Good 6: Finances

Since de-SPAC in 2021, IonQ has an annual burn rate of $100M. Despite this, they've been managing their finances well

- Cash and Cash Equivalents and Investments of $363M as of Dec 2024

- Recently raised $372M at-the-market bringing total cash to over $700M. They are well capitalised to continue operations and development.

Good 7: IonQ Systems Availability

IonQ systems are available on all 3 major cloud providers' platform: 

- AWS

- Microsoft Platform

- Google Cloud Marketplace

Good 8: Patent Portfolio

With the acquisition of Qubitekk and IDQ, IonQ now has over 900 patents in their portfolio. If they have control over important tech such as quantum networking and photonics interconnect, that'll be a very critical moat against competition.

The Bad 👎

Bad 1: The Competition

There has been a lot of announcements from Google, Microsoft, Nvidia and IBM on their quantum computing achievements. Many feel that these big companies will win the quantum computing race but I beg to differ. I think the companies that are singularly focused on quantum computing development and their business depends on it are more likely to succeed. Take for example the development of GPU - Intel with their size and experience back then could have developed the most successful GPU products but they didn't. Nvidia did. So who are the likely contenders? In my opinion, out of the big 4 mentioned above, IBM (Superconducting) poses the greatest threat. Other competitors are startups like Quantinuum (ion trap) and PsiQuantum (photonics). Both are not listed. 

Bad 2: IonQ Systems Stability

Presently, 2 Aria and 1 Forte systems are available via cloud access. However, stability of the systems have deteriorated recently with only up to 60% uptime. This means more disruptive experience for users and less revenue as a result.

Bad 3: Revenue and Bookings

Revenue has been doubling YoY and up until this FY, IonQ has been sharing their bookings guidance. Bookings is essentially unearned revenue which gives you a good indication of expected revenue in the near team. In the last earnings call, IonQ mentioned that bookings will no longer be shared. I'm not sure what the reason is but this means less visibility and predictability to investors.

Bad 4: AQ Metrics

Since the AQ metrics of measuring quantum computer's performance was introduced in 2022, no other company has adopted it for presenting their QC's capabilities. This makes it difficult to make an apple-to-apple comparison of performance between IonQ and competitors' systems. IonQ mentioned in the latest earnings call that they'll be moving away from AQ which I think is a sensible move.

Bad 5: R&D Timeline

While IonQ is expected to unveil their 1st Barium ion system "Tempo" by the end of this year, it remains to be seen if they can successfully integrate photonics interconnect technology into the product. Timeline from research to commercialisation maybe longer than expected. For example, Barium ions as a candidate for ion trap systems as first proposed in 2009. IonQ announced the intention to build Barium ion-based system in 2021 and here we are 16 years later after the first research appeared.

Thanks for making it to the end! This concludes my 3-part article series to share my research with the community. I don't think I have any more to share at this point. 😅 In future, I'll post more thoughts on IonQ whenever new information becomes available.