10 Worst Artificial Intelligence Stocks to Buy Under $10

3) IonQ, Inc. (NYSE:IONQ)

Number of Hedge Fund Holders: 12

Share Price As On September 19: $7.72

lonQ, Inc. (NYSE:IONQ) is engaged in the development of general-purpose quantum computing systems in the United States. The company recently announced a collaboration with Zapata to benchmark generative Al techniques on quantum hardware.

Bears believe that the stock price of IonQ, Inc. (NYSE:IONQ) is expected to be impacted by its concerning financial position. The significant increase in its expenses has impacted its overall financial health. In 2Q 2024, its cost of revenue went up from $1.90 million in 2Q 2023 to $5.6 million in the current quarter. The bears believe that IonQ, Inc. (NYSE:IONQ) is investing heavily in research and development, which is the primary reason why this company is operating at a loss. The company’s costs and expenses continue to exceed its revenue, and they are also growing at faster rates compared to its top line. The basic unit of a quantum computer’s power is the qubit, and these remain unstable. Also, creating hardware that has the potential to sustain them long enough can be a serious challenge.

On the other hand, Wall Street believes that IonQ, Inc. (NYSE: IONQ)’s advancements in qubit fidelity and error correction techniques demonstrate strong progress in the quantum computing field. Moreover, optimism prevails around its ongoing projects, including the ARLIS quantum networking contract. Its success in winning federal contracts is attributed to the company’s good product and low error rates.

In 2Q 2024, while the company was able to book $9 million in sales contracts, it increased its 2024 revenue outlook to between $38 million – $42 million. Moreover, the company continues to focus on pursuing strategic partnerships to strengthen its ecosystem and deliver the Tempo system in 2025. Wall Street is optimistic about lonQ, Inc. (NYSE:IONQ)’s commercialization abilities as it extended contracts with AWS to offer quantum computers via Amazon Braket.

As per Wall Street, the shares of IonQ, Inc. (NYSE:IONQ) have an average price target of $10.63. As of the end of 2Q 2024, 12 hedge funds tracked by Insider Monkey reported having stakes in IonQ, Inc. (NYSE:IONQ).