Are Quantum Computing Stocks a Buy in January?

Sometimes, it just takes a little momentum for a stock market narrative to start. This is precisely what happened with quantum computing stocks in late 2024. Stocks like Rigetti (NASDAQ: RGTI), Quantum Computing (NASDAQ: QUBT), and IonQ (NYSE: IONQ) have shot up hundreds of percentage points in the last six months, crushing the returns of the hottest artificial intelligence (AI) stocks. The momentum began with the idea that quantum computing could help with AI workloads and was accelerated by a breakthrough quantum computer chip from Alphabet's (NASDAQ: GOOG)(NASDAQ: GOOGL) Google.

2025 has been a different story so far. The three quantum computing stocks referenced above collapsed in the first few days of this year after comments by Nvidia CEO Jensen Huang during the CES tech expo in Las Vegas. Should you buy the dip on these quantum computing stocks in January? Or is this short-lived party officially over?

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Let's dive further into these businesses and find out.

A volatility roller coaster stemming from headline reactions

Quantum computing is an early-stage technology that researchers have worked on for decades. Using the mysterious properties of quantum mechanics, quantum computers can solve highly complex problems that are virtually impossible for traditional computers to solve in a reasonable amount of time. These range from pharmaceutical simulations to atomic structures, encryption, or simply predicting the weather more accurately.

Rigetti, Quantum Computing, and IonQ are three companies working to make quantum computing a viable business. If they do, it could revolutionize the entire computer industry, which is massive when you combine both personal and commercial use cases. In fact, some researchers believe that quantum computers will be so powerful they will render the current encryption methods of cryptocurrencies broken.

Optimism with these new technologies has abounded in the wake of the new artificial intelligence tools that have taken the world by storm. These tools require a lot of computing resources to scale up, which quantum computers could theoretically provide. Microcap stocks such as Rigetti have soared on this optimism. Further fuel was thrown on the fire when Google's Quantum AI lab announced a new quantum computer chip called Willow, which Wall Street took as a sign that quantum computing is much closer to commercialization. Quantum Computing shot up over 1,000% in the last six months after the news was announced.

These headline reactions reversed when Huang soured on the immediate quantum timeline. Speaking during a Q&A session at CES earlier in January, he said that quantum computing commercialization was likely 15 to 30 years away. This is what caused the quantum computing stocks to collapse as much as 60% since the start of 2025.

Promising technologies with technical hurdles

It can pay to listen to Huang. It is perhaps his top priority at Nvidia to figure out what the future of computing will be. From his comments, it is clear that he is bullish on the potential of quantum computing (Nvidia works with a lot of these companies), but that he believes it will be many years before these products reach true commercialization.

Quantum computers at the moment are tiny, wildly expensive, and only operate in the most optimal conditions. When a quantum system interacts with its environment, it can screw up the whole computing process. It is also extremely difficult -- at least with current research methods -- to scale and correct errors with quantum computers. This makes them too unreliable to be used in commercial applications. They only work in the most optimal conditions in research labs.

The technology has been proven to work and shows immense promise, but there are still many technical hurdles that engineers need to solve with quantum computing. It will likely take billions of dollars in research spending before they are solved.

Data by YCharts.

Should you buy the dip on quantum computing stocks?

Investors could talk all day about the promise of quantum computers. But that's all it is right now: a promise. These quantum computing companies generate minimal amounts of revenue that combine to less than $50 million over the last 12 months. All three have wildly negative profit margins. If Huang is correct that it will take at least 15 years for quantum computers to be commercialized, this is likely 15 years when IonQ, Quantum Computing, and Rigetti are losing money.

These are not situations you want to invest in. Even if you assume all three of these companies will help bring quantum computers to market, who is to say they will get there first? Google-parent Alphabet has vast resources and could win the race to quantum supremacy. It is unclear when quantum computers will get commercialized, and it is not guaranteed that these small quantum computing companies will be the ones to do it.

All three of these quantum computing stocks have wildly inflated valuations compared to their financial figures. Most long-term investors will want to avoid buying Rigetti, IonQ, and Quantum Computing stocks for their portfolio right now. Only heavy risk takers with long investing horizons should even consider them.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Brett Schafer has positions in Alphabet. The Motley Fool has positions in and recommends Alphabet and Nvidia. The Motley Fool has a disclosure policy.