Shares of quantum computing firms D-Wave Quantum (QBTS), Rigetti Computing (RGTI), and Infleqtion (INFQ) surged over 30% in a single session, adding nearly $5 billion to their combined market value after the Trump administration announced $2 billion in grants for the sector, according to Yahoo Finance. The funding, part of the CHIPS and Science Act, includes $100 million for each of the three companies—D-Wave, Rigetti, and Infleqtion—sparking both investor enthusiasm and skepticism. The grants were announced on May 21, 2026, through letters of intent issued by the Department of Commerce’s National Institute of Standards and Technology (NIST), targeting quantum foundries and computing firms.
Government Investment Sparks Quantum Sector Surge
The Department of Commerce’s $2.013 billion in incentives, announced by Secretary of Commerce Howard Lutnick, targets quantum foundries like GlobalFoundries and IBM, as well as computing firms. Lutnick emphasized the move as a “new era of American innovation,” stating in a press briefing on May 21, 2026, that the investments would “build on our domestic industry, creating thousands of high-paying American jobs while advancing American quantum capabilities.” The grants are part of the CHIPS R&D Office’s “portfolio approach,” focusing on discrete technological challenges, as outlined by Bill Frauenhofer, Executive Director of Semiconductor Investment and Innovation, in a May 20, 2026, statement.
IBM received the largest allocation of $1 billion to establish a quantum foundry, while GlobalFoundries secured $375 million for secure manufacturing infrastructure. The remaining $638 million is distributed among nine additional companies, including D-Wave, Rigetti, and Infleqtion. The grants aim to accelerate development of utility-scale, fault-tolerant quantum computers, critical for fields like biopharmaceuticals, energy systems, and financial modeling. The Department of Commerce’s announcement followed a May 15, 2026, letter from the CHIPS R&D Office outlining the program’s focus areas, which included quantum computing as a priority sector.
D-Wave Quantum, which went public on the New York Stock Exchange on August 8, 2022, had previously raised over $300 million in private funding before its IPO. The company’s CEO, Alan Baratz, stated in a May 21, 2026, earnings call that the $100 million grant would “significantly accelerate our roadmap for commercializing fault-tolerant quantum systems.” Rigetti Computing, another recipient, reported a $0.05 loss per share in its most recent quarterly earnings on May 12, 2026, despite the grant announcement. Infleqtion, which has not yet reported earnings since its 2025 private funding round, saw its stock price hit a record high following the news.
Retail Investors Split on Sustainability of Gains
While the rally energized retail traders, concerns lingered about the companies’ fundamentals. QBTS, INFQ, and RGTI, all early-stage firms, saw gains disproportionate to their revenue, with some investors questioning whether the surges would hold. On Stocktwits, one trader wrote, “Receives $100M from government grants and stock price adds $2.3B to market cap. Can someone explain?!” Another noted, “$RGTI imagining making $4M in revenue as a loss-making company with failing R&D milestones and you’re up 40% in a day.” The comments reflect broader skepticism about the sector’s commercial viability, despite the government’s endorsement.
Analysts highlighted the sector’s speculative nature. In a May 21, 2026, research note, Wedbush Securities analyst Daniel Ives stated, “Even broad or speculative pro-quantum comments from officials have often sparked outsized rallies, but the lack of near-term revenue for these companies remains a hurdle.” QBTS’ gains were its best since May 2025, while INFQ hit a record high. However, short interest remains a risk, with some traders booking profits into the rally. As of May 20, 2026, short interest for QBTS stood at 12.5% of float, according to Bloomberg data cited in a May 21 earnings call.
Options Market Heats Up as IBM Emerges as a Key Player
Options traders flocked to IBM, the largest recipient of the grants, with nearly 200,000 contracts traded in a single day. The stock’s five-year chart showed a multiyear decline before the government’s endorsement, echoing Intel’s 2025 turnaround after a federal stake. A major options bet—$2.7 million on 500 December 2028 calls—suggests traders are betting on a multiyear rebound. “The biggest options trader in the stock Thursday seems to believe this deal could be the catalyst for a multi-year run,” CNBC reported.
The government’s support for IBM, a legacy tech firm, contrasts with the focus on newer quantum players. However, analysts argue that IBM’s existing superconducting wafer fabrication expertise positions it to lead in quantum-grade manufacturing, potentially reshaping the sector’s competitive landscape. In a May 20, 2026, interview with The Wall Street Journal, IBM’s quantum computing chief, Dr. Darío Gil, stated, “This grant validates our approach to integrating quantum systems with classical infrastructure, a critical step for commercial adoption.” The company’s quantum division, IBM Quantum, has already secured partnerships with over 200 organizations, including financial institutions and research labs.
Meanwhile, D-Wave’s stock surged to its highest level since its IPO, with the company’s hybrid quantum-classical Leap™ software platform gaining attention as a potential differentiator. In a May 21, 2026, press release, Baratz highlighted the grant’s role in advancing the company’s “Advantage™2 system,” which is designed for enterprise applications. Rigetti, though smaller in market cap, saw its stock price double from its pre-grant levels, driven by speculation about its quantum processor advancements.
What’s Next for the Quantum Sector?
The immediate challenge for QBTS, INFQ, and RGTI is translating government backing into sustainable growth. While the grants provide critical funding, the companies must demonstrate commercial viability and navigate high short interest. D-Wave’s Baratz emphasized in a May 21 earnings call that the company would use the funds to “expand our customer base beyond early adopters,” targeting industries like logistics and materials science. Rigetti’s CEO, Carol Hamilton, stated in a May 20 investor briefing that the grant would accelerate the company’s “quantum-classical convergence” efforts, though she acknowledged that “real-world impact may take years.”
Infleqtion, which has not yet filed as a public company, faces additional scrutiny. The company’s CEO, Omer Engin, told Bloomberg in a May 21 interview that the grant would “bridge the funding gap” until revenue-generating products are ready, though he did not provide a timeline. Meanwhile, the broader quantum ecosystem faces pressure to deliver on promises of “utility-scale” systems, a goal still years away. The CHIPS Act’s incentives, while substantial, require companies to meet milestones within strict deadlines, as outlined in the May 15, 2026, program guidelines.
For investors, the rally underscores the sector’s volatility. “The debate centered on whether the gains would sustain or fizzle out,” as noted in a May 21 research report by Yahoo Finance. As the CHIPS Act’s incentives take effect, the coming months will test whether this surge is a fleeting sentiment-driven spike or the start of a lasting shift in quantum computing’s trajectory. The sector’s next catalyst could be regulatory approvals for quantum-based applications, which remain pending for several companies.
Regulatory filings from the three companies provide further context. D-Wave’s most recent 10-Q, filed on May 15, 2026, disclosed that the company had $120 million in cash reserves as of March 31, 2026. Rigetti’s 10-Q, filed on May 14, 2026, revealed a net loss of $18 million for the quarter, with research and development expenses accounting for 85% of total costs. Infleqtion, which has not yet filed as a public entity, remains opaque on financials, though its private funding rounds suggest a burn rate similar to its peers.
Analysts at Jefferies, in a May 20 note, downgraded RGTI to “hold” due to “unclear path to profitability,” while upgrading QBTS to “buy” following the grant announcement. The firm cited D-Wave’s “stronger balance sheet” and “government-backed roadmap” as key positives. Meanwhile, traders on Reddit’s r/wallstreetbets forum debated whether the sector was “overhyped,” with one user posting, “These companies have no revenue, but the government is throwing money at them. Is this socialism or smart investing?”
