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FROM THE EDITOR.
News that NEC Corporation reportedly ended development of a physical quantum computer seized a lot of attention this week. According to media reports, after determining that commercialization would take too long to deliver an adequate return, the company is ending its pioneering efforts to build a quantum computer.
Trying not to be too speculative, but this is what the market is demanding now. Quantum hardware developers, in particular, are being asked to explain not only whether their technology can work, but also when it can become commercially useful and who will pay for it.
I wish it weren’t the case, but scientific progress alone does not automatically produce a viable product. A company also needs the capital to support years of development, a credible path to manufacturing, enough technical talent and customers willing to experiment before the technology reaches maturity. It must accomplish all of that while competing against companies backed by governments, technology giants and increasingly patient investors.
NEC’s reported decision should not be treated as proof that quantum computing is failing. It’s not proof that companies that continue along their quantum roadmaps will succeed either. It’s just a piece of evidence in an industry still trying to determine which technologies, companies and business models can survive the long trip from laboratory to market.
Quantum computing may still be young, but the period when participation alone counted as progress is ending.
Details on NEC and more below…
Have a great weekend, and thanks for reading!
— Matt, Chief Content Officer at The Quantum Insider
— Krista Elliott, Narrative Content Strategist at The Quantum Insider
Check out this week’s handpicked quantum research studies and news focusing on real-world impact: improving accuracy, reducing latency, using fewer resources, or solving problems that classical methods struggle with.
A Quantinuum-led research team designed a test called the "complement sampling game" to demonstrate a quantum advantage that doesn't rely on unproven assumptions about computational difficulty, the way most quantum advantage claims do. The team ran this game on Quantinuum's System Model H2 trapped-ion processors, testing bit-string lengths from 5 to 37 and using as many as 55 qubits, and the quantum strategy consistently beat the best possible classical strategy, with the researchers rejecting the classical-strategy hypothesis at a 1% significance threshold.
Sparrow Quantum, working with Ruhr University Bochum, developed a deterministic single-photon source that now operates at 1 gigahertz, delivering more than 500 million usable photons per second into a single-mode optical fiber, the highest single-photon flux reported to date. The source combines that repetition rate with more than 50% fiber efficiency while maintaining high photon purity and indistinguishability, meaning the photons genuinely look alike to each other rather than just arriving quickly.
MIT researchers, led by associate professor Kevin O'Brien, designed a new superconducting qubit architecture they call the "arm qubit," which splits the two core jobs a qubit has to do (storing quantum information and interacting with other components) across two physically separate but connected parts. In simulations, the design combined long information-storage times with faster operations and faster readout than existing superconducting qubit designs.
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Quantum Headlines.
While NEC might be pumping the brakes on its quantum ambitions, IBM is shifting into fourth gear. Every week, it seems the OG tech giant is making a new quantum-related announcement, and this week is no different, with the announcement of a quantum innovation hub in Zurich. The collaboration includes the exploration of quantum sensing applications for navigation and the improvement of additive manufacturing of metallic alloys. These projects also complement ongoing efforts by IBM and Lockheed Martin across a range of advanced technologies focused on aerospace and defense innovation. This doesn’t contradict Matt’s news; it complements it. As the quantum industry evolves past the Wild West of experimentation and into focused commercial efforts, we’ll see investment and attention funnel toward the most high-priority use cases. Defense will definitely be one, medicine another. What else? We’ll have to wait and see.
— Krista Elliott, Narrative Content Strategist at The Quantum Insider
IBM, Lockheed Martin and armasuisse have established a quantum innovation hub at ETH Zurich that will host Switzerland’s first IBM Quantum System Two. IBM expects to deploy the system, powered by its Nighthawk processor, at the Swiss National Supercomputing Center by the end of 2026. The collaboration includes research into quantum sensing for navigation and additive manufacturing, along with support for Swiss education, workforce development and industrial applications.
SEALSQ says its Quantum Highway now connects nine operational or planned hubs across Spain, France, Switzerland and the United States as part of its SEALQUANTUM.com strategy. The network links activities including semiconductor design, post-quantum personalization, secure-device manufacturing, quantum processor development, photonic integration, PKI and satellite operations across the nine hubs. SEALSQ says more than $65 million of its planned $200 million quantum initiative has been deployed, with another $100 million earmarked through the end of 2027 for additional assets and infrastructure.
An Alice & Bob and Hyperion Research report says HPC centers must prepare their software, workflows and expertise before fault-tolerant quantum computers arrive. The report recommends testing quantum-HPC-AI architectures, developing open software standards and jointly designing workflows across computing disciplines. Interviews with 15 HPC practitioners found that premature deployment of immature systems could undermine confidence in quantum computing.
PsiQuantum has finalized a $100 million U.S. Department of Commerce award under the CHIPS and Science Act to support quantum computing R&D and domestic semiconductor manufacturing. The funding, combined with PsiQuantum’s co-investment, will support development and manufacturing of optical switches, single-photon detectors and advanced packaging technologies. The company plans to expand its U.S. supply chain while using silicon photonics manufacturing to support the development of fault-tolerant quantum computers.
GLOBAL QUANTUM + AI CHALLENGE!
The Global Quantum + AI Challenge is an international initiative designed to move quantum research closer to industrial use. In partnership with enterprises, technology providers, startups, and research teams, the program focuses on real-world problems where quantum computing may eventually create practical value, with AI and high-performance computing serving as key tools for testing, benchmarking, and deployment.
This week’s featured challenge comes from Airbus, which is seeking new approaches to predictive aerodynamic modeling. Accurately forecasting aerodynamic flows requires solving partial differential equations using state-of-the-art HPC, but current methods still face scaling limits and continued reliance on expensive wind tunnel testing under demanding acceleration and Mach conditions. Airbus is looking for more efficient PDE solvers that could help future product solutions meet strict quality, performance, and environmental requirements.
Teams working in quantum algorithms, hybrid quantum-classical workflows, scientific machine learning, computational fluid dynamics, or quantum-inspired optimization are encouraged to take part. Phase I concept proposals are open until 15 September 2026.
Sign up now to participate in the Global Quantum + AI Challenge and help turn quantum research into industrial outcomes.
EDITOR’S SPOTLIGHT.
➡️ NEC has ended its effort to build a working quantum computer after concluding that commercialization would take too long to provide an adequate return on its investment.
➡️ The decision comes despite NEC’s long history in the field, including its researchers’ demonstration of a superconducting solid-state qubit in 1999.
➡️ NEC and its research partners later developed an eight-qubit superconducting quantum annealer, although the prototype remained far from the scale required for commercially useful work.
➡️ The company will continue working on quantum annealing, related services and quantum-inspired systems that run on conventional computers.
➡️ Some observers may see NEC’s withdrawal as evidence that quantum computing is progressing more slowly than anticipated, particularly as technical challenges and development costs continue to rise.
➡️ Another interpretation is that NEC is making a focused business decision in a crowded market where better-funded companies and national programs are committing heavily to quantum hardware.
Commentary:
NEC gave the quantum industry a sobering piece of news this week by ending its effort to develop a working quantum computer.
According to Nikkei Asia, the Japanese technology company discontinued development of a physical system at the end of March. NEC apparently concluded that bringing the technology to market would take too long to generate an adequate return on its investment.
The decision naturally raises some — arguably — larger questions. Is NEC’s withdrawal a warning about the progress of quantum computing, or is it simply a business decision by one company facing increasingly stiff competition?
There is a reasonable case for both interpretations.
Those looking for warning signs will point out that NEC is not an inexperienced outsider. Its researchers played an early role in superconducting quantum computing and in 1999 became the first to demonstrate the operation of a superconducting solid-state qubit.
NEC also continued working in the field long after that initial achievement. The company pursued quantum annealing hardware with Japan’s National Institute of Advanced Industrial Science and Technology and later joined Tohoku University in research involving an eight-qubit annealing machine.
That system used superconducting technology and an architecture developed by Austria-based ParityQC. It was described as Japan’s first domestically produced quantum annealer that outside researchers could access over the internet.
And those are just some of NEC’s accomplishments.
NEC’s decision could therefore be interpreted as another indication of the distance between demonstrating how a quantum computer works and actually making a machine that’s commercially useful.
It’s hard not to contextualize this against the bigger capital-intensive backdrop of quantum computing. Quantum hardware has undoubtedly advanced and competing requires lots of talent, lots of money — and lots of patience.
Developing a competitive system requires physicists, engineers, specialized fabrication, control electronics, software and years of testing. Companies must continue spending while the timing and size of the eventual commercial market remain uncertain.
Also, remember that NEC has many business units and its decisions could simply be based on the fact that those other units offer more immediate commercial opportunities.
There is, however, another way to read NEC’s decision.
Quantum computing has become a much more competitive field since NEC demonstrated that early superconducting qubit. IBM, Google, Microsoft, Amazon and several specialized U.S. companies are investing heavily in hardware. China is supporting quantum development through government laboratories, universities and private companies. Europe, Canada, Australia and other regions are also building national programs.
Within Japan, Fujitsu continues to pursue several hardware approaches while the RIKEN Research Institute and other organizations are developing domestic quantum systems. Japanese companies can also access overseas quantum computers through cloud platforms without building their own machines.
NEC may have decided that matching those investments would require too much time and capital for an uncertain return. That would not necessarily mean the company believes quantum computing cannot work. It may mean NEC no longer sees building a general-purpose machine as the best use of its resources.
This is, for sure, not a rare occurence in emerging technology industries. Companies that contribute important early research do not always become the eventual hardware leaders. Developing the science, manufacturing the product and building a profitable business are different challenges.
NEC is also not leaving quantum technology entirely. The company plans to continue working on quantum annealing and related services, along with quantum-inspired computing.
The most reasonable interpretation of all of this is that players within the quantum industry is entering a more selective stage.
And all of these companies are going to use the best information and expertise available to make decisions about their quantum projects.
Some companies will continue increasing their investments. Others will concentrate on software, services, components or specialized systems. A few will decide that competing directly in hardware no longer makes financial sense.
In the end, NEC’s exit may tell us less about whether quantum computing is progressing and more about how difficult, expensive and competitive this industry we created has become.
DATA SPOTLIGHT.
PacketLight Networks and NEC demonstrated quantum key distribution over a 400G dense wavelength division multiplexing (DWDM) network using a dual-fiber setup. They integrated NEC’s QKD system with PacketLight’s PL-4000M 600G Muxponder, achieving 100% data throughput and low latency, verified via a 100GbE tester. The QKD ran over a dedicated parallel fiber, maintaining quantum signal integrity. The result: a cost-effective, scalable quantum-safe model with zero performance tradeoffs on existing high-capacity infrastructure.
EVENTS.
September 13-17 -- AQMCSE 2026 will take place at TU Delft Aula Congress Centre in Delft, Netherlands.
September 14-17 -- Fundamental Science with Quantum Computers and Simulators will take place at Miramar Palace in San Sebastián, Spain
September 15 – Quantum Leap Career Nexus 2026 will take place at the University of Maryland.
September 19-20 -- 8th International Workshop on Quantum Compilation will take place in Toronto, Canada.
September 21-25 -- Congresso Brasileiro de Ciências e Tecnologias Quânticas (CBCTQ 2026) will take place in Niterói, Rio de Janeiro, Brazil.
September 23-25 -- Quantum World Congress 2026 will take place at The Hotel at the University of Maryland in College Park, Maryland.
October 1 -- Quantum in Business (QiB) Conference will take place at The Westin Chattanooga in Tennessee and will be hosted by EPB Quantum.
October 1 -- QDA Forum 2026 will take place at Battersea Power Station in London
October 7 -- City Quantum & AI Summit will take place at Mansion House in London.
October 20-22 -- NVIDIA GTC Berlin 2026 will take place in Berlin, Germany.
November 17-18 -- World Quantum Cannes Festival will take place at the Palais des Festivals in Cannes, France.
FEATURED RESOURCE.
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The Quantum Insider
Editor: Matt Swayne
Contributors: Krista Elliott
