IonQ's $1B Acquisition and Drug Discovery Leap With NVIDIA

IonQ (NYSE: IONQ) has been making waves among quantum computing stocks. Its bold statements and recent acquisitions have caught a lot of attention.

On June 9, IonQ put out two more press releases, adding further intrigue around this stock.

Here’s a breakdown, starting with an update the company provided on its partnership with NVIDIA (NASDAQ: NVDA), Amazon.com (NASDAQ: AMZN), and AstraZeneca (NASDAQ: AZN).

IONQ, NVDA, AWS, and AZN Achieve 20x Acceleration in Drug Discovery Simulation

These partners are working on a project to speed up drug development. AstraZeneca is one of the top pharmaceutical stocks in Europe. The partnership focuses on creating a “quantum-accelerated computational chemistry workflow." Computational chemistry is the science of using computer simulations to understand chemical reactions. This can be particularly useful in drug development as the field involves solving complex chemical problems.

Quantum computing may be able to help with this, as computational chemistry often looks to understand chemicals at a quantum level. IonQ's workflow blends quantum and classical computing to tackle drug development challenges. Developing new drugs can take a decade or more and cost billions. Advancements in computational chemistry can potentially lower the time and cost of developing drugs. This is because researchers can study a chemical simply by using a computer. They don’t need to undertake the task of synthesizing it to achieve this.

The company’s work focused on a specific step in the Suzuki-Miyaura reaction. Overall, the project completed the simulation 20 times faster than previous implementations. This reduced the amount of time the simulation took from months to days while maintaining accuracy, clearly demonstrating how companies can use IonQ's technology to speed up drug development. Depending on the costs, this creates a potentially compelling use case.

A particularly interesting part of this announcement relates to the near-term usefulness of quantum computing. Much of the discussion on quantum has centered on when it might fully replace traditional computing. The hybrid quantum and classical approach shows that quantum can be useful in the near term within certain applications. For IonQ, quantum-traditional collaborations could create meaningful near-term revenue opportunities. This would be helpful to IonQ’s financials as it progresses toward its longer-term goal of developing a fault-tolerant quantum computer. Computational chemistry also has use cases in consumer packaged goods and new energy solutions, suggesting that IonQ could find partnerships in other industries based on its success in this one.

Senior Director of Quantum and CUDA-X at NVIDIA, Tim Costa, said, “This work represents a meaningful step towards applying quantum-accelerated supercomputing to important use cases.”

IonQ’s Latest Purchase Strengthens Its Position Across the Pond

In a second June 9 announcement, IonQ said it has agreed to acquire Oxford Ionics, a United Kingdom-based startup that partners with the government. The value of the Oxford Ionics transaction is nearly $1.1 billion. Sadly for shareholders, most of Oxford's payment will be in IonQ shares, which creates a dilutive effect on existing shareholders.

However, this decision makes sense. IonQ has only $588 million in cash and short-term investments. It has also burned $118 million in cash from operations over the last 12 months. Therefore, acquiring something this substantial in cash would be impractical, while financing it through debt would probably incur high interest rates.

Dilution has become a common occurrence at IonQ, with its outstanding share count rising by around 24% over the last 12 months. This transaction will add between approximately 21.1 million and 35.2 million shares to the company’s current count, which is significant.

Still, the transaction could be very beneficial if the acquisition achieves its objectives. Oxford holds world records for fidelity, a measurement of quantum accuracy. The company believes the acquisition can help it achieve its ambitious goals. They plan to build “full fault-tolerant quantum computers with 2 million physical qubits and 80,000 logical qubits by 2030."

IonQ’s Development Has Important Near and Long-Term Implications

The results of IonQ’s hybrid quantum-classical partnership demonstrate the potential of its technology to assist with practical use cases today. The acquisition helps keep IonQ in the race to develop a large-scale fault-tolerant quantum computer by the end of the decade. International Business Machines (NYSE: IBM) recently outlined its ambitions to do so by 2029. IonQ shares are down around 5% in 2025, as of the June 11 close. However, over the last 52 weeks, shares have remained up around 383%.

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