Not IonQ. Not D-Wave. This Quantum Stock Could Be 2027's Surprise Winner.

While quantum computing holds significant promise as a transformative technology that could improve pharmaceutical discovery, materials science, and artificial intelligence (AI), many quantum computing stocks have failed to deliver lately.

Take IonQ (NYSE: IONQ) and D-Wave (NASDAQ: QBTS), for example. Their share prices are down 29% and 54% year to date, respectively, despite the companies being widely considered among the top in quantum computing.

So, where can investors find a quantum computing stock winner? Here's the surprising part: You need to look slightly outside conventional quantum computing stocks and choose Microsoft (NASDAQ: MSFT).

Here's why it's a good quantum computing stock and why it could be a winner next year.

Image source: Getty Images.

How Microsoft is tackling the quantum computing market

I know Microsoft isn't the first company people think of when talking about quantum computing, but it's making significant moves in this space that are worth considering.

First, Microsoft developed a topological superconductor, which it calls a topconductor, that is capable of producing more stable qubits (the units of computation for quantum computers). Microsoft then pairs that with its own chip architecture, called Majorana, to help scale those qubits, with the goal of eventually reaching 1 million qubits on a single chip.

The company recently made new advancements with Majorana, releasing the second iteration of its chip architecture, which it says yields a 1,000x improvement in qubit stability.

This is important because all quantum computing essentially has the same endgame: to create a fault-tolerant computer that can scale large enough to solve problems traditional computers can't solve.

But Microsoft's work in this area is more than just theoretical. The company already offers some quantum computing processing to customers through its Azure cloud computing services. The Azure Quantum service is already used by researchers now and could expand further in the coming years.

And this is where I think Microsoft has an advantage over pure-play quantum computing companies. Microsoft's Azure Cloud reached $100 billion in annualized revenue in fiscal 2026, as customers relied more on its artificial intelligence cloud services.

AI will drive Azure sales for years as the AI cloud market is estimated to reach $2 trillion by 2030, according to Goldman Sachs. Growth in Microsoft's cloud business and other services allows it to invest in quantum computing technologies without the same risks that IonQ, D-Wave, or other quantum computing companies face.

And because Microsoft is highly profitable -- it had $19.6 billion in free cash flow in the fiscal fourth quarter of 2026, ended June 30 -- investors don't need to worry if the company will have enough runway to continue operating (which is nearly a concern with some other quantum companies).

Why Microsoft stock could perform well in 2027

Microsoft's Q4 2026 was its best quarter in 28 years, with revenue rising 18% to $90 billion and operating income rising 18% to $40.6 billion.

The growth was fueled by Azure's accelerating AI revenue, and as I mentioned earlier, it's continuing to grow. Microsoft's management says Azure revenue will rise by 45% in fiscal 2027. Investors will get a glimpse of its growth when the company reports its Q1 results on Oct. 28.

Microsoft's ability to tap into the expanding AI cloud space has helped push the company's share price up more than 20% over the past six months, with the initial surge happening right after the company reported its Q4 results.

There's no guarantee Microsoft stock will continue to climb, of course. But Microsoft is a leading cloud computing company with 21% of the global market, surpassed only by Amazon at 28%, according to Synergy Research Group. The combination of the increasing demand for AI cloud computing and Microsoft's strong position in this space suggests that the company's sales and earnings will continue to benefit from this segment.

And with Microsoft continually expanding its quantum computing technologies and already integrating them into its Azure platform, Microsoft is in a unique position to benefit from two of the most significant technologies to emerge in decades.

Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, Goldman Sachs Group, IonQ, and Microsoft. The Motley Fool has a disclosure policy.