The U.S. Department of Commerce announced today that it has signed letters of intent with nine quantum computing companies to provide a combined $2.013 billion in federal funding, under the CHIPS and Science Act. The announcement, published this morning through the CHIPS Research and Development Office, is the largest single federal intervention in the quantum computing sector to date. 

The official release is available here: Department of Commerce Announcement

The nine recipients were two quantum foundries (one of which is IBM) and seven quantum computing companies, covering a portfolio of architectural approaches including superconducting, trapped ion, neutral atom, photonic, and silicon spin. The largest beneficiary was IBM, promising to start a new foundry (with the government’s $1b investment), then GlobalFoundries at $375 million; and five of the seven computing companies received $100 million each. The smallest award went to an early-stage silicon spin startup at $38 million.

D-Wave Quantum (NYSE: QBTS) is among the $100 million recipients, and its stock drew the sharpest retail attention of the day. QBTS closed up roughly 43% from its prior-day close of $19.28, finishing the session at $27.57. The entire index went up, with even companies that received nothing (including IonQ which rose +11%) were carried up by the sector-wide reaction. 

We need to examine exactly what this all means, because it is absolutely not what the market thinks it is. 

Today’s Announcement

Here are all nine recipients with their proposed award amounts:

IBM (Anderon subsidiary) — $1 billion 

GlobalFoundries (Quantum Technology Solutions) — $375 million 

D-Wave Quantum (NYSE: QBTS) — $100 million 

Rigetti Computing (Nasdaq: RGTI) — $100 million 

Infleqtion — $100 million 

PsiQuantum — $100 million 

Atom Computing — $100 million 

Quantinuum — $100 million 

Diraq — $38 million

Total: $2.013 billion

History on the CHIPS Act

This announcement came through the CHIPS and the Commerce Department. The CHIPS and Science Act was signed into law in 2022, under the Biden administration. The purpose of this was to encourage semiconductor fabrication operations domestically, after the United States had spent decades offshoring semiconductor manufacturing. At the time of signing, the US was producing just 12% of the world’s chips, down from roughly 37% in the 1990s. Congress responded with $52 billion in semiconductor incentives and $11 billion earmarked specifically for advanced research and development.

The R&D side of that program runs through the Department of Commerce, administered by the National Institute of Standards and Technology, or NIST. NIST is the federal agency responsible for measurement standards, laboratory accreditation, and technical benchmarking across U.S. industry. Its role here is as the program office: it evaluates applicants, structures awards, and sets the technical milestones that recipients must meet to receive funding.

The purpose of this act was to encourage foundry development – which at least $1.3b was. The remaining $700 million went outside that scope to develop the quantum computing industry, although it’s questionable how needed that is given the sky-high valuations and cash hordes most of these companies are sitting on right now. 

The Details

The Commerce Department’s release uses the word “incentives” throughout, a deliberate attempt to avoid characterizing these disbursements as grants or direct government investment. The government is essentially buying equity stakes at a 15% discount to share price, with each organization diluting current shareholders. 

Several details are worth reading carefully:

• The letters of intent are non-binding, and as most deals from this administration, how it turns out is still TBD and likely differing from the initial press release. 
• No money has moved. The final award requires execution of definitive documents, and D-Wave’s own press release discloses that the Department can suspend or terminate negotiations, that milestones may not be satisfied, and that appropriated funds may not be available. 
• Because the investment is directly with the company, these deals will dilute shareholders – something that appears to have been lost in today’s stock price rise. 
• When the definitive agreement closes, D-Wave (as an example) will issue $100 million in new shares to the government at a 15% discount to whichever closing price is lower: the day the LOI was executed or the day the final agreement is signed.

The fact that these conditions exist, and that the market still rose the way that it did, tells us that most shareholders did not read the full report, and most media were presenting this as a net cash infusion. It is absolutely not, and if anything, shareholders lost value today.

What the Award Says About D-Wave

Investors will take this as a government endorsement on D-Wave’s technology, but it’s really not. Almost every non-foundry recipient received the same amount: $100 million. The only exception was Diraq, an early-stage silicon spin startup, which received up to $38 million. It’s clear that the government was taking a portfolio approach to its investment. In fairness, it is worth acknowledging that at least D-Wave is now able to squeeze into these deals – something they weren’t able to accomplish in last year’s DARPA QBI selections. 

The more accurate characterization is that this program is a portfolio hedge. The government is placing roughly equal bets across multiple quantum modalities simultaneously, covering superconducting, trapped ion, neutral atom, photonic, and silicon spin architectures, because no one in Washington, or anywhere else, knows which approach will prove out at scale.

The bull case, to be fair, is that D-Wave cleared some level of government review and made a list that not every quantum company made. That is not nothing. 

See our Investor Report on D-Wave Quantum, for an insider’s deep dive on this stock.

This Is About QCI, Not Annealing

We are on record as being highly skeptical of D-Wave’s dual-platform strategy and believe the Quantum Circuits acquisition was significantly overvalued. That said, it appears the acquisition is providing one unintended benefit: it gave D-Wave a gate-model story credible enough to participate in government R&D and grant programs that would otherwise have been out of reach for a pure annealing company. 

The language Commerce used to describe what D-Wave’s award is actually for makes this clear. The release frames the scope of work as addressing “unresolved engineering problems” which in our analysis only applies to gate model (QCI’s technology). That distinction matters, because the market reaction suggested investors read this as validation of D-Wave’s current commercial position. The government’s own language does not support that interpretation.

D-Wave’s Expanding Government Presence

Today’s announcement did not happen in a vacuum. D-Wave has been systematically building its government presence for several months, while watching its commercial prospects disintegrate. Today’s LOI is likely a direct result of that lobbying work.

For the past 9 months, D-Wave has substantially increased its lobbying efforts, and has made several hires that would directly support their government sales efforts. 

Caution should be exercised before stating that this is good execution – at the end of the day, this is not revenue but just an investment (at a potentially steep discount to share price). That is not worth the lobbying effort, unless they are able to turn this into something more substantial. 

Coherence does believe that D-Wave will be reconsidered for the DARPA Quantum Benchmarking Initiative program within the next six months. If that happens, investors should expect a series of press releases framing the development in optimistic terms. Understanding what that program actually evaluates, and what inclusion or exclusion means technically, will matter considerably more than the headlines. We will be covering it when it arrives.

Foundry Investments and the Supply Chain Question

The foundry aspect of today’s announcement is potentially important for D-Wave, and could cut against the bearish thesis. 

Something that has gone largely unnoticed is the supply chain risk created by IonQ’s pending acquisition of SkyWater Technology. SkyWater has been manufacturing quantum annealing chips for D-Wave, alongside foundry services for several other companies in the quantum space. Once SkyWater closes into IonQ as a wholly owned subsidiary, D-Wave’s primary chip supplier will be owned by a direct competitor. The contractual and operational implications of that relationship have not been publicly addressed. 

Coherence was preparing to expose this in a report this summer, along with the impending supply-chain fallout that could come if IonQ were to dissolve the deal. We’re going to need to deep dive into the implications of today’s funding of two new foundries, but our initial takeaway is that these could be helpful for D-Wave’s supply chain vulnerability. The question is when, if ever, these foundries will come online – something worth monitoring. 

What About the Companies (IonQ) That Did Not Participate?

The framing that emerged in financial media and social media describes IonQ’s exclusion as a “Washington snub”, but we think it’s most likely that they declined to participate. The market seems to have brushed it off. 

IonQ ended Q1 2026 with $3.1 billion in cash and near-cash, just approved the $1.8 billion SkyWater acquisition, reported Q1 revenue of $64.7 million against a consensus estimate of $49.7 million, and is actively building domestic semiconductor manufacturing capacity through the SkyWater deal… precisely the kind of vertical integration the CHIPS program says it is trying to incentivize. The fact is – it might not have been the government snubbing IonQ. IonQ likely snubbed the government.

No one from IonQ has said anything publicly about why they were not included, whether they applied, or whether they chose not to participate.

Keep in mind that Google and Microsoft are also players in the Quantum Computing space, and they chose not to participate as well. This was likely a case where only companies that needed the money applied to be included in the program, which means this says more about the companies who accepted government investment, rather than the ones who chose to abstain.