IBM Missed the Bus on AI. New Federal Funding Means IBM Stock Could Be a Winner in Quantum Computing.

International Business Machines (IBM), more commonly known as IBM, is not hogging any significant spotlight in the current era of artificial intelligence (AI). Unsurprisingly, while shares of Nvidia (NVDA), Broadcom (AVGO), Advanced Micro Devices (AMD), and others have rallied like there's no tomorrow, IBM stock has traded as a laggard. Shares of IBM are up just 0.5% on a year-to-date (YTD) basis and about 14% over the past 52 weeks.

However, while IBM may have missed the bus in terms of AI, it surely doesn't want to miss the next big thing. To that end, one recent development just boosted the company's prospects in the quantum computing space.

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Under the CHIPS and Science Act, the federal government is set to grant $1 billion to IBM to set up a quantum computing chip manufacturing company. Named Anderon, IBM claims that it will be first U.S. pure-play quantum foundry. IBM itself will match the contribution while providing personnel and other assets for the company, which will be based out of Albany, New York.

“IBM has pioneered quantum computing for decades,” said CEO Arvind Krishna on the news. "Our work in silicon wafer fabrication has been a key to IBM's success and will be critical to enable a broader quantum technology landscape that will reshape global innovation and economic competitiveness. With the support of the U.S. Department of Commerce, Anderon will be well-positioned to fuel America's fast-growing quantum technology industry."