Not IonQ. Not D-Wave. This "Boring" Blue Chip Stock Is Quietly Leading in Quantum Computing

In recent years, artificial intelligence (AI) has been the driving force behind stock market gains. Investors, always looking for the next big thing, have piled into companies involved in this field. But AI isn't the only area set to transform how things are done in the business world and at home. Quantum computing also has emerged as a potential game changer, and investors have turned their attention to companies innovating in this area.

Why is everyone so excited about quantum computing? This is because it offers the possibility of addressing problems that are impossible to solve using classical computers. Pure play innovators including IonQ and D-Wave Quantum have attracted investors' attention as they advance their programs -- and they've seen their stock prices soar on occasion as they progress.

Now, you would expect a small, specialized company to win in this quantum computing race. After all, they devote all of their resources and research efforts to this technology. But these players might not be the biggest winners. In fact, the following "boring" blue chip stock is quietly leading in quantum computing.

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Quantum versus classical computing

Before diving in, let's take a quick look at how quantum computing works, and this starts with a look at classical computing. The computing we know well and have been using for years involves bits processing information as a zero or as a one. Quantum computing uses qubits instead of bits, and these processors may store information as a zero, a one, or both at the same time. They can scale up exponentially, and all of this allows them to tackle big problems and solve them fast.

Today, quantum computing companies use various techniques to develop qubits and execute calculations, from the trapped ion method to superconducting techniques. The former involves manipulating ions with lasers to calculate, the latter involves using silicon etched with special superconducting materials. Companies are progressing, but challenges such as scale and error correction remain. The idea is to achieve quantum advantage, or the point where quantum computers may solve problems more efficiently and accurately than a classical computer -- and validate that the answers are correct.

Though companies, from pure plays to tech giants, are taking important steps forward and generating revenue through the sales of their quantum systems, we haven't yet reached the moment of quantum advantage across broad commercial platforms.

A well-established giant excels at quantum computing

Now, let's take a look at the company that could get there first, or among the first. And that is a name that's been around since the early part of last century: International Business Machines (NYSE: IBM).

Today, IBM generates most of its revenue from its software business, which brought in $7.8 billion in the third quarter, and also is heavily present in the areas of consulting and infrastructure. All of this helped the tech giant increase revenue 5% to $17 billion in the recent quarter. This may look "boring" compared to certain AI companies that are generating double- and triple-digit revenue growth. But quantum computing may represent a big potential revenue driver for this long-established company over time.

In June, IBM announced a $10 billion commitment to its quantum computing roadmap over the coming five years. Today, the company boasts the world's biggest fleet of quantum computers, having deployed more than 90 over the cloud and on-site. It recently made available Nighthawk r2, its most advanced processor yet, using 120 programmable qubits to execute over 100,000 circuits per second. That's 25x the throughput of its current Heron platform.

IBM and Algorithmiq, a quantum software company, also recently offered a fresh demonstration of quantum advantage, simulating a heterogeneous quantum material.

IBM chief Arvind Krishna told CNBC in an interview back in July that quantum computing will "have a measurable impact on our top line and bottom line" in 2028 or 2029. "By the end of the 2030s, we are now pretty convinced this is a trillion dollars of value," he added.

Of course, there probably won't be just one victorious company in the quantum computing space. There is room for various techniques and players to succeed. But right now IBM is in an excellent position to be one of the principal winners, and this could spur a wave of explosive growth down the road.

Adria Cimino has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends International Business Machines and IonQ. The Motley Fool has a disclosure policy.