11 Best Quantum Computing Stocks to Buy Right Now

2. Alphabet Inc. (NASDAQ:GOOGL)

Number of Hedge Fund Holders: 234

Alphabet Inc. (NASDAQ:GOOGL) is a leading player in the quantum computing industry through Google Quantum AI, which is its dedicated research division having emphasis on developing quantum processors, applications and algorithms. Furthermore, the company announced Willow, which is the latest quantum chip.  Willow managed to perform a standard benchmark computation in less than 5 minutes which will take today’s fastest supercomputers 10 septillion years. With the help of Willow, Google’s researchers mentioned that adding more physical qubits to a quantum processor made it less error-prone, which means it is reversing the typical phenomenon.

Alphabet Inc. (NASDAQ:GOOGL)’s announcement of Willow is expected to significantly enhance computing power and AI capabilities, resulting in allowing Google to differentiate its cloud services with the help of advanced hardware offerings. As we know, one of the critical problems with quantum computing is that it is error-prone, mainly with the more qubits it uses. Alphabet Inc. (NASDAQ:GOOGL) seems to be addressing this issue, saying Willow has the potential to exponentially reduce errors as it scales up using more qubits. While quantum-powered AI can strengthen the company’s AI leadership, quantum cybersecurity solutions are expected to protect Alphabet Inc. (NASDAQ:GOOGL)’s ecosystem.

Qualivian Investment Partners, an investment partnership focused on long-only public equities, published the Q3 2024 investor letter. Here is what the fund said:

“Alphabet Inc. (NASDAQ:GOOGL): Q2 2024 revenues and EPS beat expectations, with total revenues growing 14%, Search ad revenues growing 14%, YouTube ads growing 13%, and Google Cloud revenues growing 29%. Revenue growth in the quarter constituted a continued sequential improvement from earlier quarters in the year, suggesting a continued rebound in Alphabet’s core business except for YouTube ad revenues, which missed expectations and showed deceleration in the growth rate as compared to Q1 when it grew 21%. Operating margins improved by 310 bps vs. the same quarter last year.

Management continued to highlight developments with their generative AI program, which is seen as a foundational platform with opportunities across their businesses but particularly in search and cloud. However, this comes with material capex investment well ahead of the expected economic benefits from Gen AI, and the level of spending is leading investors to worry about the ROI on that spend for Alphabet, as well as the other hyperscalers (Microsoft and Amazon). We continue to have confidence in Alphabet’s ability to generate strong revenue, earnings, and cash flow growth well above the S&P 500’s in the years to come and view it as a core holding for the long term.”