Hours earlier, US-listed IonQ Inc (NYSE: IONQ) delivered the biggest quarter in its history.

Now, the VanEck Quantum ETF (ASX: QNTM) now gives local investors direct access to the theme.

What the new quantum computing ETF actually holds

QNTM tracks the MarketVector Quantum Computing Ecosystem Index.

The index targets businesses building quantum hardware, quantum software, and the components that support both.

That is a wide net that captures early-stage pure plays alongside far larger technology companies running quantum research programs.

The fund charges a management fee of 0.65% per year, which is expensive next to a broad index fund, though not unusual for a narrow thematic product.

QNTM listed alongside two siblings on 6 August.

One covers global semiconductors at 0.35%, while the other holds rare earths and strategic metals at 0.59%.

VanEck's Asia-Pacific chief executive Arian Neiron pitched the trio on their thematic appeal rather than their breadth.

The launches land in a record year for Australian ETFs, with the local industry closing the financial year at $372 billion in funds under management.

Recent earnings: inside IonQ's record quarter

IonQ is the most visible pure-play name in the sector, and its second-quarter numbers were astounding.

Revenue reached US$80.1 million, up 287% year-on-year, and came in a full 20% ahead of the company's own guidance. Encouragingly, organic revenue growth (revenue growth outside of acquisitions) was 132%.

Chief executive Niccolo de Masi described it as "the strongest quarter in our company's history".

Management also lifted full-year 2026 revenue guidance to a range of US$280 million to US$290 million, while remaining performance obligations climbed to US$485 million, up from US$122 million a year earlier.

Yet despite all of this, IonQ reported a GAAP net loss of US$1.9 billion for the quarter.

Most of that was a US$1.6 billion non-cash movement on warrant valuations, so the headline figure overstates the operating position. But adjusted EBITDA was still negative US$120.3 million.

Record revenue and heavy losses are arriving together, which is entirely normal for an industry at this stage of its life.

The catch with this quantum computing ETF

Quantum computing is a technology still waiting for its commercial breakthrough.

Revenue growth of 287% sounds spectacular, and it is, but it is also growth from a very small base funded by shareholders rather than by profits.

A quantum computing ETF does spread that risk across many companies, but it does not remove it.

If the commercial breakthrough takes another decade, a diversified basket of loss-making innovators will still struggle.

QNTM is also brand new, so there is no performance record to assess.

This is where position sizing comes into play.

Something like the Vanguard Australian Shares Index ETF (ASX: VAS) does a very different job in a portfolio, holding roughly 300 established Australian businesses that are profitable today.

A speculative theme works best as a small satellite around a core like VAS.

Foolish takeaway

IonQ's result is evidence that quantum computing is starting to generate real revenue.

It is not yet evidence that the industry can generate real profits, and the gap between those two things is where thematic investors most often get hurt.

If the theme interests you, the new quantum computing ETF is a reasonable way to access it.

I would size the position as though it may not work.

But I would also keep the bulk of your capital somewhere diversified and, frankly, a little boring.

The post IonQ just posted record revenue. What does it mean for the ASX's newest quantum computing ETF? appeared first on The Motley Fool Australia.

Many investors look toward the tech sector for potential millionaire-maker stocks. But for every stock like Nvidia, which minted new millionaires, there are plenty of stocks like Intel which shrivelled over the past decade.

So if you're looking for the next Nvidia and trying to avoid the next Intel, you should look for companies that are establishing an early mover's advantage in their nascent markets, growing rapidly, widening their moats, and outlasting their competitors. I believe these three stocks fit that description: IonQ (NYSE: IONQ), Opendoor (NASDAQ: OPEN), and DigitalOcean (NYSE: DOCN). Here's how these three stocks can eventually become millionaire makers.

1. IonQ

IonQ is a provider of cloud-based quantum computing services. Quantum computers store binary bits of zeros and ones simultaneously in "qubits," which enable them to process data faster than traditional computers which process those bits individually. Quantum computers can be used to accelerate a wide range of tasks, but they're big, expensive, and make more errors than binary CPUs. IonQ aims to resolve those issues with a "trapped ion" miniaturisation process which shrinks the average width of a quantum processing unit (QPU) from a few feet to a few inches.

By miniaturising and scaling up those systems, IonQ aims to reduce the costs of quantum computing and improve the accuracy of the devices' calculations. From 2021 to 2023, its revenue rose from just $2 million to $22 million. From 2023 to 2026, analysts expect its revenue to grow at a compound annual growth rate (CAGR) of 89% to $148 million.

IonQ expects to keep expanding as it gains new customers, acquires smaller companies, and increases its own quantum computing power. It's still bleeding red ink and its stock is expensive at 47 times its 2026 sales, but it's gradually establishing an early mover's advantage in the nascent quantum computing market. If it maintains that lead, its stock could skyrocket as more companies use its quantum computing services.

2. Opendoor

Opendoor is an online "iBuyer" (instant buyer) that makes instant cash offers for homes, fixes them up, and relists them for sale on its first-party marketplace. That digital home-flipping business model streamlines the home-selling process, but it's a capital-intensive business that is highly exposed to rising interest rates. The iBuying model is also heavily dependent on AI-powered pricing, but those algorithms can sometimes misprice its properties.

Inflation and supply chain constraints can also make it expensive and challenging to renovate all of its purchased properties. That's why the online real estate listing platforms Zillow and Redfin both shut down their first-party iBuying platforms in 2022.

But with Zillow and Redfin out of the picture, Opendoor is now the largest remaining iBuyer. Its revenue plunged 55% in 2023 as rising interest rates chilled the housing market, and analysts expect another 28% decline in 2024. That near-term outlook seems bleak, but they expect its revenue to grow at a CAGR of 27% from 2024 to 2026 as interest rates decline and the housing market warms up again.

Opendoor will likely stay unprofitable for the foreseeable future, but its stock looks dirt cheap at 0.3 times this year's sales. If it finally gets its act together as the macro environment improves, its stock could generate millionaire-maker gains for its patient investors.

3. DigitalOcean

DigitalOcean is a cloud infrastructure platform provider that carves out tiny "droplets" of individual servers for smaller customers at lower prices than enterprise cloud giants like Amazon or Microsoft. Its acquisition of Paperspace last year also added GPU-powered AI capabilities to its servers.

The bears claimed DigitalOcean would struggle to grow in the shadow of Amazon, Microsoft, and other cloud infrastructure giants. But from 2020 to 2023, its revenue grew at a CAGR of 30%. It also turned profitable in 2023 as it streamlined its spending.

From 2023 to 2026, analysts expect its revenue and EPS to grow at CAGRs of 13% and 85%, respectively. That growth should be driven by the growing demand for its cloud infrastructure and AI services from smaller businesses and individual developers. DigitalOcean's stock isn't cheap at 47 times next year's earnings, but the dominance of its niche market and improving profitability could justify its premium valuation and drive it even higher.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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