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Investing.com-- Several U.S. quantum computing companies are in talks to give the Commerce Department equity stakes in exchange for federal funding, the Wall Street Journal reported on Wednesday, citing people familiar with the matter.
IONQ (NYSE:IONQ), Rigetti Computing (NASDAQ:RGTI), and D Wave Quantum Inc (NYSE:QBTS) are among firms discussing government shareholdings as part of funding agreements, while Quantum Computing Inc (NASDAQ:QUBT) and Atom Computing are considering similar arrangements, the report said.
Shares of IONQ spiked by more than 13% in premarket U.S. trading on Friday in the wake of the news. Rigetti added 11.7%, D Wave climbed by 16.3%, and Quantum Computing rose 13.6%.
The companies are reportedly seeking a minimum of $10 million each from Washington, the report added.
The discussions mark a widening of the Trump administration’s push to take ownership stakes in sectors it considers critical. In August, the government took a nearly 10% stake in Intel (NASDAQ:INTC) by converting about $9 billion in grants into equity.
Deputy Commerce Secretary Paul Dabbar is leading the talks, which would represent one of Washington’s first major investments in quantum computing, a technology seen as vital to future breakthroughs in materials, chemistry, and drug discovery, the WSJ report said.
The quantum computing market is estimated to climb to roughly $4 billion in value by the beginning of the next decade, analysts at BofA recently projected, although they flagged a number of impediments to the technology’s growth which are currently being worked on and researched. Last year, the market for quantum computing, which aims to leverage quantum physics to solve complex tasks at a much faster rate than traditional computers, was worth around $300 million, they said.
The BofA estimates come after McKinsey, a consultancy, suggested in a report in June that the value of the quantum technology market could skyrocket to $100 billion within a decade.
(Scott Kanowsky contributed reporting.)