Microsoft announced a significant milestone in quantum computing with the unveiling of its Majorana 1 chip, a development that sent shares of quantum computing companies higher on Thursday.
The breakthrough marks a key step in Microsoft’s 17-year research effort and aims to accelerate the path toward building large-scale quantum computers.
According to Microsoft, the Majorana 1 chip will “realize quantum computers capable of solving meaningful, industrial-scale problems in years, not decades.”
D-wave (QBTS), Rigetti (RGTI), Quantum Computing (QUBT) rally
The announcement lifted shares of several quantum computing companies, with D-Wave Quantum rising 9.79%, Rigetti Computing up 3.91%, and Quantum Computing gaining 4.77%.
IonQ saw an initial increase in premarket trading but was trading in the red by 1.04% at 2:29 pm.
The broader market, however, declined, with the S&P 500 slipping 0.8% and the Nasdaq Composite falling 0.9%.
Unlike conventional computers that rely on binary bits, Majorana 1 is a quantum processing unit (QPU) designed to leverage quantum mechanics for vastly more complex calculations.
Microsoft described its approach as “radically different,” using topological qubits that are “small, fast, and digitally controlled.”
A step toward industrial-scale quantum computing
Microsoft framed the Majorana 1 announcement as a turning point, shifting from scientific discovery to technological application.
The company published its latest findings in the journal Nature, emphasizing that its architecture could enable a million qubits to fit on a single chip.
The race for quantum dominance remains highly competitive.
IBM, a key player in the sector, has set a target to build a “quantum-centric supercomputer” with 100,000 qubits by 2033.
However, Microsoft believes its approach offers a clearer path to scaling quantum systems beyond that milestone.
Quantum computing proponents argue that the technology could revolutionize industries, from pharmaceuticals to cybersecurity, enabling optimization of complex systems in minutes rather than hours.
The ability to train more advanced artificial intelligence models is another key potential advantage.
Investor optimism meets skepticism
Despite the enthusiasm, experts remain cautious about quantum computing’s near-term prospects.
Nvidia CEO Jensen Huang recently warned that meaningful applications of quantum computing could still be decades away.
His concerns were echoed by Meta Platforms CEO Mark Zuckerberg, who described the technology as being “quite a ways off” from large-scale practical use.
Nevertheless, some quantum firms have made commercial progress.
D-Wave Quantum, for example, began selling quantum computers in 2011, with Lockheed Martin as an early customer.
The company recently secured a deal with Germany’s Jülich Supercomputing Centre, marking a significant milestone in quantum adoption.
Investors continue to grapple with the uncertainty surrounding quantum stocks.
While Microsoft’s achievement bolstered market confidence, experts such as Mahoney Asset Management CEO Ken Mahoney advised caution.
“Some companies may outright fail,” he noted, emphasizing the speculative nature of the sector.
Wall Street analysts suggest that while quantum computing has long-term potential, its commercial viability remains uncertain.
As Microsoft and other firms advance their research, investors will closely watch for signs of real-world applications and profitability in the sector.
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