University of Kwazulu-Natal

Why Nvidia Is Buying Into Quantum Computing Time

Bonisiwe Shabane
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why nvidia is buying into quantum computing time

Nvidia’s (NVDA) $600 million investment in Quantinuum values the quantum firm at $10 billion, doubling its prior valuation. Major investors like JPMorgan and Mitsui joined the round, reflecting strong market confidence in quantum computing. NVDA CEO Jensen Huang’s revised outlook highlights quantum’s nearing practicality, potentially boosting quantum computing stocks. Nvidia made early investors rich, but there is a new class of ‘Next Nvidia Stocks’ that could be even better. Click here to learn more. Nvidia’s (NASDAQ:NVDA) venture capital arm, NVentures, recently joined a $600 million funding round for Quantinuum, a quantum computing firm majority-owned by Honeywell (NYSE:HON), valuing it at an impressive $10 billion.

Over the past two weeks, NVIDIA—the powerhouse behind and chief beneficiary of the artificial intelligence boom—has moved into quantum computing. “I’m a little surprised they haven’t done it before,” said Richard Shannon, investment analyst at Craig Hallum. Through its venture capital arm, NVIDIA has joined other backers in funding startups Quantinuum, QuEra, and PsiQuantum, now valued collectively at more than $17 billion. This marks a notable shift for NVIDIA’s CEO, Jensen Huang. In January, Huang dismissed practical quantum computers as being 15 to 20 years away, sparking a selloff in listed quantum firms. But by March he had softened, and in June he suggested the field had reached an “inflection point” that might enable “interesting problems” to be solved in the near future.

NVIDIA declined to comment further. By positioning itself at the heart of the hardware driving AI models, NVIDIA has become the world’s most valuable company, worth $4 trillion. The company designs GPUs (specialized processors for AI workloads), builds CUDA (software allowing GPUs to interconnect), and delivers complete supercomputers—machine-sized units that AI firms are racing to install in their data centers. Yet quantum computing is unlikely to directly benefit NVIDIA’s AI clientele. “Quantum computing and AI are sort of diametrically opposed,” said Pete Shadbolt, chief science officer at PsiQuantum, one of NVIDIA’s recent investees. AI thrives on massive datasets and pattern recognition, while quantum systems, by contrast, “hate data, and they love precision,” he explained.

Still, advocates argue quantum technology could usher in a fresh computing paradigm. Rather than executing countless simple tasks in parallel like GPUs, quantum computers aim to solve a small number of extremely complex problems. Quantinuum uses ions, PsiQuantum relies on photons, and QuEra employs neutral atoms. All operate under the peculiar rules of quantum mechanics, which allow particles to exist in multiple states simultaneously. This lets quantum machines pursue many branches of a problem at once, offering solutions beyond the reach of classical computers in practical timeframes. That includes breaking modern encryption—something that could take traditional machines millions of years—in just hours, prompting banks to adopt “quantum-resistant” cryptography.

Daily stocks & crypto headlines, free to your inbox By continuing, I agree to the Market Data Terms of Service and Privacy Statement Nvidia Quantum Cloud has already gained widespread adoption with quantum computing developers. The company recently introduced NVQLink to connect quantum and classical computers. Nvidia is following a familiar pick-and-shovel strategy with quantum computing that has worked very well with AI. Back in California's gold rush in the mid-1800s, thousands of individuals flocked to the region hoping to find gold and strike it rich.

However, the easy money was instead made by the suppliers who sold tools to the gold prospectors. Today, the term "pick-and-shovel investing" honors that legacy. Oftentimes, providers of ancillary products and services achieve greater success than pure-play companies do.

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