(May 22): The Trump administration has agreed to award US$1 billion ($1.28 billion) to International Business Machines Corp (IBM) to build a foundry for producing quantum computing chips, part of a broad strategy to bolster US leadership in an emerging industry.
IBM will also invest US$1 billion into a new business, called Anderon, which will produce the processors, the company said in a statement on Thursday. Both IBM and government funding will go towards operating a quantum wafer facility at an existing semiconductor manufacturing research centre in Albany, New York, according to a statement from Chuck Schumer, a Democratic senator from the state.
Shares of IBM rose 12% to US$252.97 in New York on Thursday, marking the biggest single-day gain in more than a year.
Other companies that received awards also jumped. GlobalFoundries Inc, a semiconductor firm developing specialised chips for quantum computing, rose 15%. D-Wave Quantum Inc gained 33%, Rigetti Computing Inc rose 31%, and Infleqtion Inc surged 31%.
Governments are lining up financing for quantum computing, a nascent technology that researchers believe could provide a range of new capabilities in everything from drug discovery to computing encryption standards. Though the machines are primarily used for research purposes for now, their promised capabilities could pose a threat to national security, breaking the systems that protect banks and government data.
In addition to IBM, the US government awarded funding to more than a half-dozen other companies. GlobalFoundries is receiving US$375 million, the company said in a statement. D-Wave, Rigetti, Infleqtion and PsiQuantum said in separate statements that they had signed letters of intent with the US Commerce Department for as much as US$100 million apiece. Other recipients of US$100 million awards included Atom Computing Inc and Quantinuum, while the start-up Diraq will get US$38 million.
See also: EU seeks to exempt banned Chinese chips to shield carmakers — Bloomberg
The deals, which have yet to be finalised, are part of a broader US$2 billion support package from the Commerce Department for quantum computing, using resources from the 2022 Chips and Science Act. The US government is set to receive minority, non-controlling equity stakes in each of the companies in exchange for the awards, according to a statement on Thursday from Commerce.
Specifically, the funds will come from a research and development office that had received US$11 billion under the Chips Act, a broader US$52 billion overall initiative signed by then-president Joe Biden to boost the US semiconductor industry.
Last year, Secretary of Commerce Howard Lutnick voided US7.4 billion of the US$11 billion given to a non-profit for research, steering a share of that money towards investments that would provide a return for the government. The extension into backing quantum companies is also part of his remaking of the 2022 Chips and Science Act.
See also: Manus weighs raising US$1 bil to unwind Meta takeover — Bloomberg
A mix of start-ups and large firms, including Microsoft Corp and Alphabet Inc’s Google, are trying to apply quantum physics to make computers exponentially more powerful than today’s machines.
These companies are betting that the nascent field, which uses the rules of subatomic particles to manipulate and transmit information, is getting closer to delivering real-world progress in fields like drug discovery and finance.
Uploaded by Tham Yek Lee
