Quantum equities are volatile and have a high degree of volatility, but a major technological company is building up a large quantum business behind the scenes that is not falling prey to the hype in the mainstream market and is at the same time paying a significantly high dividend.
IBM is a sensible and safe long-term investment to investors who would like to be exposed to quantum computing without having to pay overvalued shares.
The Hype Train
Quantum Computing Inc. (QUBT) has adopted the viral quality as it has shot up to at least $0.42 in July 2024. Analysts expect QCi to generate $2.8 million in revenue in 2026.
However, with a market capitalization of $2.69 billion, it trades at 960 times that estimate. That meme stock valuation may limit its upside potential and make it a prime target for short sellers during the next market crash.
Shorting of approximately 22 % of its shares at the end of 2025 implies that it is perceived by many players in the market as a possible bubble that is going to burst.
Why Is IBM Different?
IBM is not only a quantum provider, but a turnaround story based on cloud computing, artificial intelligence and enterprise software, and it is also a leader in quantum computing.
That all changed when Arvind Krishna, IBM’s cloud chief, took over as CEO in 2020.
Under Krishna, the company spun off its struggling managed infrastructure services division as Kyndryl and expanded Red Hat’s hybrid cloud and artificial intelligence (AI) offerings.
That strategic shift enabled IBM to grow revenue and EPS at CAGRs of 3% and 1%, respectively, from 2020 to 2024.
Analysts expect IBM’s revenue and earnings per share to grow at CAGRs of 5% and 19%, respectively, from 2024 to 2027, as the company’s turnaround continues.
Quantum represents a comparatively smaller business: IBM has already implemented over 85 quantum systems, already implemented at least 3 trillion quantum code, and has been working on next-generation chips, Eagle, Heron, Nighthawk, Loon, to achieve a fault-tolerant system by the year 2029.
The Quantum Business Today
The universities, government agencies, and research laboratories use the IBM quantum systems, although it is not a significant source of income currently. This should be the case since quantum computing is still at the research and utility stage but is not yet on a mass commercialization scale.
Instead of aiming at profitability in the short term, IBM is building a platform, IBM Quantum Experience, cloud access, and developer tools, to ensure the commitment of customers in the decade to come.
According to IBM’s The Enterprise in 2030 study, quantum computing is expected to reshape the industry by the end of the decade, but most enterprises are not preparing for its adoption, creating a strategic gap that could expose even the most advanced AI organizations.
What’s Ahead?
Quantum revenue will not turn into a significant contributor in the case with IBM, but the company is setting up an identity as the backbone of computing infrastructure in the next era.
With the increasing rates and volatility of a market, IBM provides lower risk technology exposure with cash flow that is proven, and a growing dividend-rewarding patient retention, a quantum equity.
