⚛️🦾 Where Quantum’s Largest Returns Are Expected

A Newsletter for Entrepreneurs, Investors, and Computing Geeks

Author

Emily Eisenblätter
August 11, 2025

Happy Monday! This week’s deep dive looks at where the largest returns in quantum computing are expected and why most of the commercial gains may go to application-layer companies rather than hardware makers.

In our spotlights, we cover OpenAI’s latest $8.3 billion tranche as part of its record funding round, Mistral’s $10 billion fundraising target, and a string of other sky-high Gen AI valuations.

We also highlight major headlines across semiconductors, quantum, photonic, neuromorphic, data centers, and cloud markets, along with curated readings on tensor networks, quantum error correction, breakthroughs in photonic computing, and the evolving role of data centers in the AI era. Funding news was quiet, with only three rounds around the $20M mark in semiconductors and quantum.

In this week’s bonus section, we follow a semiconductor storyline that could be lifted from a spy novel, with arrests, technology leaks, and talent-poaching probes unfolding across the U.S., Taiwan, and China.

Deep Dive: Where Quantum’s Largest Returns Are Expected

Quantum computing could transform industries from finance to life sciences, yet the companies building the hardware may capture only a fraction of the economic value. Most of the commercial gains are expected to accrue to those applying quantum technology, not those manufacturing it.

For investors, that could mean the most significant opportunities are in application-layer companies and hybrid players rather than pure hardware bets.

Total economic impact
Quantum computing could generate $877B globally between 2025 and 2035, but vendors (companies that build and sell quantum technology, such as hardware makers, quantum software and platform providers, and Quantum Computing as a Service (QCaaS) operators) are expected to capture only $55B (~6%).

Value capture imbalance
Most benefits will flow to end users (organizations that apply quantum computing to their own problems, such as banks, pharma companies, or logistics operators) because:

  • High R&D costs and slow hardware adoption: Quantum hardware takes years and massive investment to develop, yet market demand is still in a testing phase rather than a mass adoption phase, limiting sales.

  • Cloud-based QCaaS dominated by hyperscalers: Most users access quantum through AWS, Azure, or Google Cloud, which control customer relationships and keep a large share of revenue.

  • Faster scalability of applications: Quantum-enabled software and workflows can be developed and deployed to many users quickly, while building, upgrading, and deploying quantum hardware remains slow and costly.

Industry beneficiaries (end users)
Annual value by 2030

  • Finance: $19B (e.g. portfolio optimization, fraud detection, risk modeling)

  • Transportation and logistics: $17B (e.g. routing, scheduling, supply chain optimization)

  • Life sciences: $17B (e.g. drug discovery, molecular simulation, materials design)

Together, these three sectors are expected to capture around 80% of quantum’s total projected economic impact.

Top use cases
Share of total impact

  • Simulation: 36% (e.g. drug discovery, materials design)

  • Machine learning: 33% (e.g. fraud detection, portfolio optimization)

  • Optimization: 22% (e.g. routing, supply chains)

  • Cryptography and security: 9% (e.g. secure communications, data protection)

Investor implications
Most of quantum’s commercial value is likely to be created at the application layer rather than in hardware manufacturing. Investors should look beyond pure-play hardware bets and consider:

  • Hybrid companies that combine hardware, software, and services

  • Application-focused startups building quantum-enabled tools for simulation, analytics, or security

  • Established enterprises that are early in integrating quantum into critical workflows

A diversified approach can capture value from both infrastructure development and the faster-scaling applications that are expected to deliver the bulk of commercial returns.

Do you agree with that? Would love to get your input! Just shoot me a message.

Spotlights

“OpenAI’s valuation has been on a continuous upswing since the artificial intelligence startup launched ChatGPT in late 2022 and quickly established itself as the leader in generative AI. The company announced a $40 billion funding round in March at a $300 billion, by far the largest amount ever raised by a private tech company. Last week, OpenAI announced its most recent $8.3 billion tranche tied to that funding round.”

“Mistral's goal of achieving a $10 billion valuation is indicative of its ambition in a fiercely competitive landscape. As the firm aims to raise $1 billion from its fundraising efforts, the outcome will play a crucial role in defining its future trajectory and influence in the AI sector.”

And the lofty numbers aren’t limited to OpenAI or Mistral! As reported in recent weeks, Anthropic is said to be approaching $170BN, Perplexity has been valued at $18BN, and Elon Musk’s xAI is aiming for around $200BN.

Headlines

Last week’s headlines cover semiconductor policy shifts, quantum breakthroughs, advances in photonic and neuromorphic tech, data center and cloud updates, and major AI fundraising and model launches.

🦾 Semiconductors

⚛️ Quantum Computing

Keep an eye out for our upcoming interview with TAU Systems on the Future of Computing blog!

⚡️ Photonic / Optical Computing

🧠 Neuromorphic Computing

💥 Data Centers

Rolls-Royce and INERATEC back e-Fuels for green data centres (Data Centre Magazine)

☁️ Cloud

 🤖 AI

Readings

This week’s reading list spans tensor networks and advances in quantum error correction, breakthroughs in photonic computing, and the evolving role of data centers in the AI era, alongside new perspectives in cloud storage and algorithmic development.

⚛️ Quantum Computing

Tensor Networks for Quantum Computing (Nature Reviews Physics) (2 mins)

⚡️ Photonic / Optical Computing

An Ultrafast Light Switch Paves the Way for Optical Computing and Data Storage (Monash University) (3 mins)

Will Data Centers Crash the Economy (Noahpinion) (13 mins)

☁️ Cloud

🤖 AI

Funding News

A quiet week for funding, with summer holidays keeping activity low. Only three rounds landed, all around the $20M mark, covering semiconductors and quantum.

Amount

Name

Round

Category

$20M

Oxmiq Labs

Seed

Semiconductors

$20M

Celera Semiconductor

Series A

Semiconductors

$26M

QuamCore

Series A

Quantum

Bonus: Secrets, Spies, and Semiconductors

This week’s semiconductor news reads like an espionage thriller, with arrests, secret technology leaks, and allegations of talent poaching. From the U.S. to Taiwan and China, the fight for chip supremacy is spilling out of labs and into courtrooms.

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