Quantum Computing Inc. (QUBT): A Bear Case Theory

We came across a bearish thesis on Quantum Computing Inc. on Valueinvestorsclub.com by jcoviedo. In this article, we will summarize the bulls’ thesis on QUBT. Quantum Computing Inc.'s share was trading at $19.51 as of July 18^th.

Quantum Computing Inc. (QUBT) has become emblematic of speculative excess, boasting a $2+ billion market cap despite generating just $373k in 2024 revenue and $39k in Q1 2025. Formed in 2001 as Ticketcart Inc. and later renamed, QUBT repositioned itself as a “quantum photonics” company with two nominal businesses: a thin-film lithium niobate chip foundry in Tempe, Arizona, and a cloud-based quantum computer, DIRAC-3, rented for $1,000/hour.

However, an Iceberg Research report questioned the existence of the foundry, describing it as little more than office space, while the cloud offering has negligible usage. Industry leaders such as IBM, Google, and Quantinuum do not even recognize QUBT as a competitor, underscoring its marginal relevance.

Despite this, the stock has surged 110% in the past month as retail traders pile in, echoing Q4 2024’s “quantum bubble.” Insider selling has accelerated, with interim CEO Yuping Huang unloading 500,000 shares in May and director Javad Shabani exiting completely, reinforcing management’s lack of conviction. The firm has a history of misleading press releases, including multiple exaggerations of a $26,163 NASA subcontract and a failed $500k “loan” to a related AI company, Millionways, that was fully written off.

Long-term CEO William McGann abruptly resigned in April, with no explanation. With $166 million in cash, no debt, and frequent equity offerings—including $94 million raised in January—QUBT’s value appears little more than its cash per share. Further dilution, insider sales, and waning speculative fervor remain likely catalysts for a sharp correction in what bears argue is a fundamentally worthless company.

Previously, we covered a bullish thesis on IonQ, Inc. (IONQ) by Maestroszq in October 2024, which highlighted IonQ’s rapid revenue growth, patent strength, and catalysts like its Forte Enterprise launch. The company’s stock price has appreciated by approximately 329% since our coverage, as these drivers materialized. The thesis still stands as IonQ scales commercially. Jcoviedo shares a contrarian view but emphasizes QUBT’s speculative excess despite operating in the same industry.

Quantum Computing Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 13 hedge fund portfolios held QUBT at the end of the first quarter which was 6 in the previous quarter. While we acknowledge the potential of QUBT as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.