Why IonQ Stock Is Soaring This Week

Shares of IonQ (NYSE: IONQ) are surging this week. The company's stock had gained 25% over the week as I write this. The strong performance easily outpaced the S&P 500's most chaotic week in years.

A major quantum computing initiative from the Pentagon helped drive the stock higher.

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DARPA program ignites quantum sector

Late last week the U.S. military's Defense Advanced Research Projects Agency (DARPA) announced it had selected 15 companies for its ambitious quantum computing program. The initiative will explore whether it's possible to build a "useful" quantum computer that "can achieve utility-scale operation -- meaning its computational value exceeds its cost" by 2033.

DARPA's efforts were largely responsible for many of the most important technological breakthroughs of the last half-century, like the internet and GPS. The name carries a lot of weight and investors were excited to see IonQ as one of the named participants. The initiative is part of the Department of Defense's push to lead quantum technology and maintain its edge over China.

Further momentum

Just weeks ago, the company announced that IonQ Forte Enterprise, its most recent commissioned quantum computer, is now available to customers globally through Amazon's Amazon Web Services (AWS), as well as the IonQ Quantum Cloud. The move cements IonQ as a leader in the space as it focuses on real-world application of its technology.

Still, Forte Enterprise is a long way from the sort of robust, stable, and commercially viable quantum computer that could prove revolutionary. The technology is in its infancy. The DARPA program proves this as its aim is to achieve viability by 2033. There are years of high spending on R&D with minimal revenue ahead and no guarantees that the technology ever does mature. Investing in quantum computing at this stage comes with quite a bit of risk, but if you understand this and are still interested, IonQ is one of your best choices.

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon. The Motley Fool has a disclosure policy.