Honeywell Quantinum Hardware Chamber
Courtesy of Honeywell
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Quantum computing has just taken a leap forward for investors with the emergence of a brand new company called Quantinuum.
Tuesday,
Honeywell
Quantum Solutions, the quantum computing branch of
Honeywell International
(ticker: HON) and Cambridge Quantum Computing have announced that they have completed their merger announced in June. With the deal closing, Quantinuum is now the world’s largest autonomous quantum computing company, according to the new company.
Other companies including
IBM
(IBM),
Amazon.com
(AMZN) and
Alphabet
(GOOGL) have quantum computing operations, but they are hidden inside giant entities.
Honeywell, which owns a 54% stake, has decided to split it so that the new company can attract outside investment and thus develop its technology in the best way the management of Quantinuum sees fit, regardless of the material relationships or software.
“The formation of Quantinuum marks an important milestone for the quantum computing industry,” Honeywell CEO Darius Adamczyk said in a press release. “Quantinuum customers will now have access to the world’s first quantum operating system, hardware independent applications and software. ”
The merger of Honeywell Quantum Services and Cambridge essentially created this complete stack of hardware, software and applications referenced by Adamczyk. Creating this stack is one of the main benefits that Quantinuum CEO Ilyas Khan sees for the company. The integrated platform enables the company to offer its customers the best solutions, regardless of the evolution of technology, explains Khan.
The new company has 400 employees and offices in Cambridge, UK and Colorado.
Quantum computing is still very new and confusing. Quantum computers are based on the fundamentals of quantum physics. In traditional computing, information is stored in bits – strings of ones and zeros – which enable word processing, spreadsheets, and just about any other computer application anyone can think of. .
A quantum bit, or q-bit, can, in essence, be a one or a zero at the same time. It’s weird, but it allows quantum computers to do things traditional computers can’t or to tackle problems that traditional computers would take hundreds or thousands of years to solve.
The design of pharmaceutical molecules, cybersecurity and the optimization of logistics routes are three applications often cited. But quantum computing is new, and applications will proliferate as hardware improves.
Being a separate company does not yet mean being a publicly traded company. Quantinuum begins its life with around $ 270 million on the balance sheet. Quantinuum chairman Tony Uttley said investors can expect to hear about new business and investors in the coming months, but would not commit to any kind of IPO timeline.
However, investors may not have to wait that long. “Quantinuum is clearly on the path to an IPO on its own,” said Daniel Newman, analyst at Futurum Research. “The path to the public will also provide a solid investment option for institutions and retail investors who wish to bet on the long-term viability of quantum.”
Newman’s point: In the past, investors could only own huge entities like Google, where quantum computing just couldn’t move the needle. “Rumors of products coming from Quantinuum that will immediately generate revenue and run entirely on quantum hardware are also improving the viability of the company. ”
Seeing quantum sales will boost the entire industry and help investors assess the size of the quantum market. Constellation Research founder Ray Wang estimates that $ 8.5 billion has been invested in more than 240 quantum computing startups. He estimates the valuation of all companies on the private market at 174 billion dollars.
“The quantum revolution has begun,” Wang wrote in a Tuesday report.
This is good news for Honeywell investors and possibly for Quantinuum investors as well.
Honeywell stock is down 2.3% shortly after the announcement. It’s a bad day for stocks, however, as investors assess the news on the Omicron variant of Covid. The
S&P 500
and
Dow Jones Industrial Average
are both down around 1.7%.
Write to Al Root at allen.root@dowjones.com
