Quantum Leap: Quantum Computing shares sputter following $750M private placement

Welcome to the latest edition of “Quantum Leap” where The Fly decodes news and activity in the quantum computing space.

PRIVATE PLACEMENT: Quantum Computing (QUBT) announced that it has entered into securities purchase agreements with institutional investors for the purchase and sale of 37,183,937 shares of common stock in an “oversubscribed” private placement priced at the market. The offering is expected to result in gross proceeds of $750M, before deducting offering expenses. The closing of the offering is expected to occur on or about October 8. The company intends to use the proceeds to “fully fund commercialization, pursue strategic acquisitions, establish volume production capabilities, expand sales and engineering personnel, working capital, and general corporate purposes.” Titan Partners Group, a division of American Capital Partners, is acting as the sole placement agent for the offering. Shares of Quantum Computing were down on Monday following the news.

Q4 OUTLOOK: Sealsq (LAES) announced its preliminary unaudited financial metrics for the nine-month period ended September 30, along with reaffirming its FY25 revenue guidance of $17.5M-$20M. Carlos Moreira, CEO of Sealsq, stated: “While 9M 2025 revenue continues to reflect our strategic transition to the post-quantum era, third quarter 2025 revenue alone surpassed total revenue for the first half of the year and we expect the fourth quarter of 2025 to continue this trend. Thus, we expect fourth quarter revenues to be between $7.6 million and $10.1 million, with our full year 2025 revenue guidance of between $17.5 million and $20.0 million, fueled by commercial projects and the consolidation of IC’ALPS results. With Quantum Shield QS7001 and QVault TPM solutions entering production in 2026, SEALSQ is entering its growth phase.”

C-SUITE APPOINTMENT: Quantum Corporation (QMCO) announced the appointment of Geoff Barrall as the company’s chief product officer. Barrall will lead Quantum’s product strategy, innovation, and engineering direction. Most recently, he served as CPO at Index Engines.

POST-QUANTUM BROADBAND: Nokia (NOK) announced the launch of the world’s first 50G PON solution designed to provide ultra-fast, post-quantum broadband connectivity for operators serving enterprises. The solution delivers capacity, reliability and advanced security features that will protect enterprises in post-quantum era. Available on Nokia’s Lightspan MF platform, it allows operators who are deploying 10G or 25G PON to evolve to 50G PON without major disruptions. With 25/50G PON operators can use their existing residential FTTH networks to serve enterprises and other non-residential users. The solution is available on Nokia’s existing fiber line card, based on the Quillion chipset. The card is designed to deliver GPON, XGS, 25G, 50G PON and future optical modules, like 50G symmetrical and additional combinations of multi-PON and triple-PON options. The Lightspan line card uses the smallest form factor optics for all PON technologies to maximize port density and allow full backward compatibility with existing optics for smooth, cost-efficient network upgrades.

LA TECH WEEK: D-Wave Quantum (QBTS) announced its participation in LA Tech Week, offering quantum computing-focused activities hosted by the USC Viterbi Information Sciences Institute (ISI). The events will offer attendees an opportunity for expert-guided tours of D-Wave’s Advantage annealing quantum computer hosted by ISI, the first commercial quantum computer located in Los Angeles.

QUANTUM IMAGE ENCRYPTION ALGORITHM: WiMi Hologram Cloud (WIMI) announced that they are exploring a quantum image encryption algorithm based on four-dimensional chaos. This algorithm combines the complexity of chaotic systems with the parallelism of quantum computing, aiming to achieve efficient and secure image encryption. WiMi has adopted the generalized quantum image representation method to encode classical images into quantum information. The GQIR method is an effective approach for mapping image pixel information onto quantum states. By encoding the grayscale values or color information of an image into the probability distribution of qubits, a quantized representation of the image information can be achieved, laying the foundation for subsequent encryption operations. To enable efficient image encryption, WiMi introduced a four-dimensional chaotic system. Chaotic systems are characterized by high complexity and unpredictability, making them ideal tools in cryptography. Compared to lower-dimensional chaotic systems, the four-dimensional chaotic system offers a larger key space and more complex dynamic behavior, thereby providing enhanced security.

CALLING YOUR SHOT: Citron Research, in a post on X, formerly Twitter, said: “The MOST compelling trade in quantum. Buy Churchill Capital Corp X (CCCX) against any position in Rigetti Computing (RGTI). Not going to try and value Quantum right now. Are they all overvalued? The market will determine that. But what Citron can definitively say is that Infleqtion is far ahead of Rigetti in the Quantum race and we expect the two stocks to trade in parody in a rapid manner and then $CCCX will trade at a premium.”

WARRANT EXERCISE TRANSACTION: Sealsq entered into an agreement with several institutional investors, led by Heights Capital Management, Inc., that are existing holders of its warrants wherein the investors agreed to exercise the entirety of the company’s 15,000,000 outstanding Class A Black Scholes Warrants issued in July 2025, to purchase an aggregate of 15,000,000 ordinary shares for cash at the exercise price of $4.60 per share. The gross proceeds of the exercise of the existing warrants to the company, before deducting estimated expenses and fees, are expected to be approximately $69M. In consideration for the immediate exercise of the existing warrants for cash, the exercising holders will receive, in addition to the specified aggregate 15,000,000 ordinary shares, new Class C warrants to purchase up to an aggregate of 26,250,000 ordinary shares. The new warrants will be immediately exercisable for one ordinary share at an exercise price of $5.10 per share and will expire seven years from the issuance date. Additionally, the company agrees to amend the existing warrants to provide for the issuance of ordinary shares or pre-funded warrants, at the option of the holder, upon the exercise of the existing warrants, if, as a result of the exercise of the existing warrants, the holder’s beneficial ownership of the company’s ordinary shares would exceed such holder’s beneficial ownership blocker election as set forth in its existing warrants immediately following such exercise. Maxim Group acted as warrant inducement agent and Cantor Fitzgerald & Co. and Maxim Group acted as financial advisors in connection with the transaction.

ANALYST COMMENTARY: Benchmark raised the firm’s price target on Rigetti Computing to $50 from $20 and reiterated a Buy rating on the shares. Supported by substantial capital inflows, an expanding ecosystem, and growing validation from “established technology leaders,” investor interest in quantum computing continues to build and Rigetti’s execution continues to validate its long-term strategy, the analyst argued.

Ascendiant increased its price target on Quantum Computing to $40 from $22 and maintained a Buy rating on the shares. The firm expects the company’s “strong” revenue growth in 2025 and 2026 to be positive for stock. The company has recently launched several new products which investors should focus on, the analyst tells investors in a research note. Ascendiant thinks product commercialization will drive significant revenue should growth this year and next.