A handful of companies have done pilot projects showing that it is possible to use a quantum computer to speed up how long it takes to make complex calculations, such as optimizing delivery routes or calculating the risk profile of a large financial portfolio. But few of these use cases have yet progressed beyond the pilot phase. There are several fundamentally different ways of building quantum computers and there remains active debate among scientists about which technologies will ultimately prove commercially viable.
Such obstacles have not stopped a few quantum startups from selling shares on the public markets, often through reverse mergers with blank-check “special purpose acquisition companies” or SPACs. IonQ did its own SPAC deal in the autumn of 2021; since then its share price has more than tripled.
In a conversation with Fortune on January 28—prior to the release of the Wolfpack report—CEO Niccolo de Masi insisted that IonQ was in fact already selling quantum machinery to commercial partners.
“If your machine hasn’t turned on, and you have no revenue, I think [your stock] needs to be discounted heavily,” de Masi told Fortune.
However, the Wolfpack report states that IonQ has failed to disclose that up to 86% of its reported revenues from the years 2022 to 2024 came not from commercial customers but from Pentagon research grants that the Pentagon itself never asked for, and that have since been eliminated. The funding instead came, Wolfpack says, from so-called backdoor earmarks slipped into the Pentagon budget by friendly congressional representatives. IonQ may have inflated both the amount and the nature of this revenue, according to the Wolfpack report.
For instance, in September 2024, IonQ announced that it had won a $54.5 million contract with the U.S. Air Force Research Laboratory, calling it “the largest 2024 U.S. quantum contract award,” and implying that the contract was validation of what it called its “mature—and commercially-focused—technology road map.”
What the company did not say is that the Air Force Research Laboratory had awarded these contracts not because the Air Force was inherently interested in IonQ’s trapped ion quantum computing technology, but because individual members of Congress added lines to the federal budget compelling the lab to spend the money on “trapped ion quantum computing,” Wolfpack alleges.
The company also never made clear to investors that of the $54.5 million amount, only $12 million was actually funded in the budget. The larger number represented the total possible future awards under the contract, but the Air Force Laboratory had no contractual obligation to spend this amount. Despite this, Wolfpack claims IonQ included the entire number in the “bookings,” or future booked revenue, metric it provided to investors.
After Republicans won the 2024 Congressional elections, they moved to eliminate backdoor earmarks Democrats had inserted into the budget. IonQ wound up losing its original earmarks in both the fiscal year 2025 and fiscal year 2026 budget. Wolfpack estimates that of the $75.6 million in Pentagon contracts IonQ said it had booked in 2024, only $21 million was fully funded. The remaining $54.6 million, or 58% of IonQ’s total reported bookings, were unfunded portions of federal contracts awarded through backdoor earmarks.
The Wolfpack report says that rather than disclose that the earmarks have been eliminated, IonQ has engaged in a series of acquisitions in which it has purchased additional revenue, sometimes by acquiring companies with technology that is not directly related to its core trapped-ion quantum computer.
David said that because IonQ does not make it clear what portion of revenues are related to its core quantum computing business and which are coming from acquisitions, it is impossible to determine how much organic growth its quantum computing business is experiencing.
For instance, IonQ bought Capella Space, a company that operates satellites and sells satellite imagery, in July 2025 for $425 million. Of that, $50 million was paid in cash and the rest was IonQ shares. Wolfpack alleges that IonQ bought the company primarily because it generates $11 million in quarterly revenue and because Capella’s main customer is the U.S. government, allowing IonQ to continue to report growing Pentagon revenues in ways that might mislead investors into thinking this money represented continued Pentagon interest in IonQ’s quantum computing tech.
IonQ also bought Vector Atomics, a company that makes atomic clocks. Vector too has sizable government contracts, which Wolfpack’s report says could generate as much as $88 million in revenue in 2026. But the report points out that atomic clocks are not a cutting-edge technology and are not directly related to IonQ’s trapped ion quantum computers.
The company also purchased a controlling stake in Swiss quantum key distribution (QKD) company ID Quantinque for $116 million. That company generates about $6 million per quarter. But both the U.S. National Security Agency and the U.K.’s GCHQ signals intelligence agency have cautioned against using QKD because it is a cumbersome and expensive way to protect data from attacks by future, powerful quantum computers and because it is potentially susceptible to interception methods. So the potential for revenue growth may be limited.
SkyWater, IonQ’s most recent purchase, also has substantial government contracts. But Wolfpack said that the company, which made $3.1 million last year on revenues of $346.6 million, “appears to be another business that relies on backdoor earmarks for funding, supplementing its razor-thin margins with government grants.”
De Masi told Fortune on January 28 that IonQ’s acquisitions are part of a strategy to become a vertically integrated quantum company, controlling everything from the computer chip factories that could one day make chips for its quantum computers to quantum networking equipment.
“If they want to be vertically integrated, they should stop going sideways with their acquisitions,” David told Fortune. “These acquisitions, in my view, are not vertically integrated. They are tangential, if not sideways. Just because something has atomic in the name does not make it a quantum computing company.”
As a result of its flurry of acquisitions, IonQ reported that its revenues increased 222% to $39.9 million in its most recent quarter, and gave guidance that it would achieve triple-digit-millions in annual revenue in the next year. That’s more than twice the revenue of all other publicly traded quantum companies combined. IonQ also reported a net loss of $1 billion in the same period, Q3 2025. But the company is well-capitalized: It has $3.5 billion in cash and equivalents on hand, after taking $4.4 billion in investments over its history, de Masi told Fortune.
Immediately prior to the Wolfpack report, about 21% of IonQ’s stock was held by short investors. For comparison, the average for most stocks is 3%-5% in short interest.
EDITOR’S NOTE: Parts of this article, including its title and photo caption, were updated to reflect IonQ’s response to Fortune‘s queries, which was received after the article’s publication deadline.
