Quantum Computing Stocks Diverge as Risk-Off Mood Hits Market

The quantum computing sector once again proved how volatile and divided it can be as a new wave of market turbulence sent some stocks plunging while others managed to claw their way into positive territory. The backdrop to this drama was a familiar one: rising tariff concerns, escalating recession fears, and investors rushing for the perceived safety of consumer staples such as Unilever, Procter & Gamble, and Johnson & Johnson.

Against this defensive rotation, quantum computing shares found themselves caught in a risk-off storm that exposed sharp differences between hardware-focused firms and those leaning more heavily into software.

Two of the sector’s most recognizable names – Quantum Computing Inc. (NASDAQ:QUBT) and Rigetti Computing, Inc. (NASDAQ:RGTI) – bore the brunt of the selloff. By late afternoon, Quantum Computing was down 5.6%, while Rigetti shed around 5%, both having flirted with deeper 6% losses earlier in the session. These declines came as Treasury yields ticked upward, sending a clear signal that investors were fleeing riskier corners of the market. Hardware-driven businesses like these are often the first to suffer under such conditions, as their capital-intensive models require steady flows of investment and customer spending that can dry up quickly in a downturn.

Meanwhile, the other side of the quantum computing landscape looked more resilient. IonQ Inc. (NYSE:IONQ) and D-Wave Quantum Inc. (NYSE:QBTS) also opened sharply lower but managed to stabilize as the day wore on. IonQ closed down only 0.35%, while D-Wave trimmed its losses to just 0.15% by late afternoon after recovering from a steep early drop. The critical difference? Both firms supplement their hardware efforts with software solutions and cloud-based resources, which tend to carry higher margins and more predictable demand streams even when corporate budgets tighten. By the final half hour of trading, the tilt toward software exposure became evident: investors appeared more comfortable placing bets on firms that can generate revenue through recurring digital services rather than costly, complex hardware deployments.

This divide in performance highlights an emerging narrative in the sector. Quantum hardware may hold the key to future breakthroughs, but the companies that balance their portfolios with software offerings are proving more attractive in the current macro environment. For short-term traders, this means volatility will continue to rule the day, while longer-term investors must weigh whether hardware plays like Rigetti or Quantum Computing can survive until adoption scales up significantly.

Volatility in this niche is nothing new. Only a few months ago, the space enjoyed a speculative rally when Google’s Willow chip reportedly slashed calculation times for certain complex tasks. That optimism was quickly tempered in January when NVIDIA CEO Jensen Huang publicly suggested that meaningful commercial results from quantum systems may still be years away. This back-and-forth between enthusiasm and skepticism has defined quantum investing, leaving even seasoned Wall Street pros struggling to price the sector’s true potential.

Despite today’s sharp selloff for some, the bigger picture remains mixed. The Defiance QTUM ETF – an index tracking multiple quantum-related firms – has posted a respectable 13.9% gain year-to-date, reflecting investors’ belief in the long-term promise of the technology. Yet the ETF still slipped 1.4% during the latest session, a reminder that momentum in this space is fragile and easily disrupted by macro headwinds. For now, the lesson is clear: quantum stocks are splitting into two camps, and investors are showing a clear preference for those with software-driven strategies capable of weathering uncertain times.