D-Wave Pushes Quantum-AI Frontier but Faces Pressure From IBM, Google

D-Wave Quantum QBTS is advancing the intersection of quantum computing and artificial intelligence. In August, the company introduced an open-source Quantum AI toolkit, which is part of D-Wave’s existing Ocean software suite and integrates directly with PyTorch, the widely used machine learning framework.

This integration with PyTorch is significant because it lowers the barrier for data scientists and AI developers to begin experimenting with quantum-enhanced models using familiar tools, while still gaining access to D-Wave’s quantum processing capabilities.

D-Wave’s new toolkit has already shown that it can generate simple images with quantum methods, an early step toward more advanced generative AI. Companies like Japan Tobacco and Triumph are already using D-Wave’s platform to build hybrid quantum-classical AI solutions. These projects address real business problems by making AI workflows faster, more accurate and capable of solving tougher challenges.

By bringing quantum and AI together, D-Wave is positioning itself at the crossroads of two major technologies. The company sees this as a key growth driver, helping boost adoption of its Leap cloud platform and opening the door for industries like pharma, logistics and manufacturing to use quantum-powered AI for real competitive gains.

QBTS Faces Pressure as Tech Giants like IBM, GOOGL Scale Up

International Business Machines IBM: It is taking major initiatives to merge quantum computing with AI, focusing on both accessibility and scale. The company has introduced the Qiskit Code Assistant, which uses watsonx large language models to simplify quantum programming, and rolled out Qiskit 1.0 with AI-driven circuit optimizations delivering up to 40× faster performance. On the hardware side, IBM unveiled the IBM Quantum Heron processor, a 133-qubit system offering 3–5× better performance and substantially reduced cross-talk compared to its predecessor, Eagle.

Alphabet GOOGL: Google has achieved a major milestone with its Willow quantum chip, unveiled in December 2024 by the Google Quantum AI team. Willow is the first superconducting processor in which logical qubit error rates shrink exponentially as more physical qubits are added, achieving the long-sought “below threshold” quantum error correction. In benchmark testing, it completed a standard quantum circuit sampling task in under five minutes, compared to an estimated 10 septillion years for a classical supercomputer.

Over the past 30 days, shares of D-Wave have lost 9.1%.

One Month QBTS Share Performance

Average Target Price for QBTS Suggests Near-Term Upside

Based on short-term price targets offered by 10 analysts, D-Wave Quantum’s average price target represents an increase of 21.2% from the last closing price of $15.62.

D-Wave Quantum currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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