IBM said on Thursday it plans to invest more than $10 billion in quantum computing over five years as it aims to build by 2029 the first large-scale quantum computer capable of running complex calculations reliably and without errors.
The announcement follows a Trump administration decision last week to take $2 billion in equity stakes in nine quantum computing companies, with IBM set to receive half of the funding for a new venture called Anderon that would become the first dedicated quantum chip manufacturing facility in the U.S.
The move, part of the administration’s push to secure U.S. leadership in the emerging technology and counter China, underscores the growing prominence of quantum computing.
Recent technological breakthroughs in the technology have fueled investor interest in its potential to accelerate tasks from drug discovery to financial modeling and cryptography.
But major technical hurdles remain, including high error rates that limit practical use. Alphabet CEO Sundar Pichai said last year that “practically useful” quantum computers were five to 10 years away.
IBM said its new investment would span research and development, capital expenditure, ecosystem partnerships, manufacturing scaling and mergers and acquisition.
The company is making a contribution of $1 billion to Anderon, which will offer its chipmaking technology to outside customers and was already in talks with potential clients.
It has also pledged to give intellectual property, assets and workforce to Anderon and bring in additional investors as the new company grows.
Shares of IBM rose 1.7% in premarket trading.
IBM said on Thursday it has deployed more than 90 quantum systems to date, more than all other industry players combined.
Over 325 Fortune 500 companies, startups, universities and government agencies use its quantum systems to tackle challenges in chemistry, biology and materials science, according to the filing with the Securities and Exchange Commission.
(Reporting by Anhata Rooprai and Aditya Soni in Bengaluru; Editing by Leroy Leo)
