A few thoughts ahead of the listing. Images from the Capital Markets Day materials.
I agree with IQM’s slides that IQM’s valuation of approximately 1.9 billion is priced below the reference group. For example, the American company Rigetti (same superconducting technology as IQM) is a good point of comparison. It has roughly the same cash position, but revenue is only 1/3 of IQM’s. Rigetti’s headcount is about half of IQM’s, as is the operating loss. In my opinion, growing revenue, a large cash balance, a high number of employees, and a large loss (a large loss is a good thing!) are key metrics at this stage of development for quantum companies—revenue must be on a growth curve, and the cash position must be large enough to withstand significant annual losses. Also, there needs to be a lot of staff in R&D. A large loss is simply a necessary consequence of investing in product development.
IQM’s growth and order backlog profile is similar to IonQ’s. That means nearly 100% annual growth and a backlog that supports continued strong growth. The revenues for Rigetti, Quantinuum, and Infleqtion are shown on the right side of the FY2025 bar. IQM is valued at 1.9 billion before the market opens; Rigetti’s value is currently 6 billion, Infleqtion 3 billion, and Quantinuum is 19 billion today.
IQM appears to be one of the leading quantum houses relying on superconducting chips. Reference customers are nicely distributed around the world. Because of this, I believe growth is on a stable foundation. I would specifically highlight Oak Ridge in the USA, to which companies like IonQ also provide services. Oak Ridge is the federal agency that solves the world’s most difficult problems.
The slide above is perhaps the most important of all. IQM’s superconducting chip means that the technology has certain limitations in scalability and error rates, and the chips require significant cooling. Therefore, a traditional data center is the operating environment for IQM’s quantum computer. But at least at this stage of the quantum computing lifecycle, that is perfectly fine. This is because governments are open-handedly funding research labs, which are IQM’s main clientele. In an Inderes interview, IQM’s founder mentioned that IQM is much—was it 1000x?—faster than, for example, neutral atom solutions. Well, a superconducting gate is fast, but challenges arise in error rates. My point, however, is that governments will acquire these superconducting solutions, and they are good platforms for researching how quantum processors (QPUs), GPUs, CPUs, and TPUs are combined into a functional overall solution. Significant software development is done simultaneously. In the coming years, various technologies will be used in quantum computers worldwide (superconducting, ion trap, neutral atom, and then there are various quantum simulations performed via software, e.g., D-Wave). I personally think that if so-called “natural” techniques (ion trap and neutral atom) are eventually selected as the primary options for quantum chips, it is by no means the end for IQM. IQM, like all other quantum houses, is developing much more than just the chip. From the image above, you can pick out, for example, a quantum operating system and various software platforms for orchestrating and managing QPU, GPU, CPU, and TPU farms.
Among superconducting companies, IQM is clearly the most interesting to me. There is very little buzz about the company on X. The company is practically unknown to the general investing public. Hopefully, the company won’t jump 2x - 3x immediately on Friday. I see 1 billion as a kind of absolute floor for the market cap, as I estimate the 450 million cash balance will hold the market value at least at a billion. The company looks very good for the stock market right now. Good luck to IQM—Europe’s leading company in this industry.
