On Monday, Google unveiled the Willow chip, which demonstrated the capability to solve a computationally intensive problem in five minutes—a task exceeding the lifespan of the universe for a classical computer.
Tech companies are actively pursuing advancements in quantum computing, aiming to create systems that operate at speeds significantly surpassing those of traditional silicon-based computers.
Quantum computers rely on "qubits" as their fundamental components. While these qubits are capable of rapid processing, they are also susceptible to errors, complicating the task of ensuring the reliability and commercial viability of quantum systems.
Typically, as the number of qubits increases, so does the likelihood of errors. However, Google announced that the Willow chip employs a method to connect qubits in a manner that reduces error rates as their quantity increases, and it also features real-time error correction capabilities.
"Although there are no immediate applications, Willow is poised to have significant implications in fields such as science, medicine, and finance. It exponentially decreases errors and could pave the way for groundbreaking advancements across various industries," stated Thomas Hayes, chairman and managing member at Great Hill Capital.
Consequently, Alphabet's stock is poised for its best performance since late April, exhibiting a 25% year-to-date appreciation as of Monday's market close.
Alphabet's shares currently trade at a forward price-to-earnings ratio of 19.58 for the next twelve months, compared to Microsoft's 32.03 and Amazon's 36.79, according to LSEG data.
Earlier this year, Microsoft and Quantinuum jointly announced a major breakthrough in improving quantum computer reliability, signifying progress toward commercial viability.