Shares of Advanced Micro Devices (AMD) jumped nearly eight percent on Friday after reports confirmed that IBM had successfully used AMD’s chips to run a quantum computing error correction algorithm.
The development marks a milestone that could accelerate progress toward fault-tolerant quantum systems. IBM’s stock also gained about eight percent, marking its best day since January, as the breakthrough drew global attention from investors and researchers alike.
According to Reuters, a scientific paper scheduled for publication next week will detail how IBM’s quantum researchers used AMD’s field-programmable gate array (FPGA) chips to execute an advanced quantum error correction algorithm. This represents one of the most significant steps yet in overcoming the instability that has long hindered the practical use of quantum computers.
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An IBM spokesperson confirmed the report to CNBC, calling the achievement “a milestone in our clear path toward the 2029 projection” of building a large-scale fault-tolerant quantum computer.
IBM said the development shows it is possible to scale quantum systems without relying on expensive GPU clusters, a cost barrier that has restricted the technology’s broader adoption.
“Designing and implementing a way to do this at scale, and without requiring expensive GPU clusters, is a significant achievement to scaling useful quantum computers,” the company said.
This latest advancement stems from a partnership between IBM and AMD announced in August. The two companies said they would jointly develop new capabilities in quantum computing and artificial intelligence, combining their hardware and software strengths to accelerate progress in data processing and next-generation computing. IBM has reiterated its plan to debut a “large-scale, fault-tolerant quantum computer” by 2029, and this development reinforces its timeline.
Quantum error correction, the process of detecting and correcting faults that arise from the fragile nature of quantum bits, remains one of the hardest challenges in the field. The new method demonstrated with AMD’s FPGA chips marks a breakthrough that could reduce the cost and complexity of scaling quantum systems, potentially opening the door for commercial applications much earlier than previously expected.
The news triggered optimism across the broader quantum computing sector, sending shares of smaller quantum players like D-Wave Quantum, Rigetti Computing, and IonQ higher on Friday. Some believe the development could mark one of the defining moments in the transition from theoretical to applied quantum computing, with implications far beyond research labs.
The announcement also gives AMD a strategic foothold in an emerging frontier that blurs the line between quantum and classical computing. For years, Nvidia has dominated the market for AI hardware, controlling more than ninety percent of the data center GPU segment. However, AMD’s involvement in IBM’s quantum research shows the company is expanding its technological base beyond CPUs and GPUs into the realm of hybrid systems that combine programmable logic with quantum hardware.
Analysts have long noted that AMD’s presence in the GPU market has faced limitations compared to Nvidia’s overwhelming dominance. A recent analysis by SemiAnalysis pointed out that AMD faces a significant competitive disadvantage compared to NVIDIA… primarily due to limited availability and reduced market competition. The IBM collaboration could help AMD broaden its market exposure, especially in areas that leverage its FPGA technology, offering an alternative path to compete outside Nvidia’s stronghold.
Nvidia remains the industry leader in AI processing, with its graphics processors powering most large-scale artificial intelligence systems globally. The company is also expanding into quantum computing. In March, Reuters reported that Nvidia plans to open a quantum computing research lab in Boston in collaboration with scientists from Harvard and MIT. Nvidia Chief Executive Jensen Huang recently said that “quantum-classical computing… is clear now we’re within reach of being able to apply [it] in areas that can solve some interesting problems in the coming years.” Nvidia’s strategy suggests it sees hybrid quantum architectures as a natural extension of its existing GPU dominance.
Intel, on the other hand, has struggled to regain its footing in the AI and accelerator markets. A report by Seeking Alpha noted that Intel’s AI accelerator strategy has been largely reactive, “trying to take whatever business AMD cannot take, like that from Nvidia.” Intel has made advances in quantum control systems through projects such as its Horse Ridge chip, developed with QuTech, but it is not considered a front-runner in full-scale quantum computing. The rise of AMD and Nvidia in the AI and quantum ecosystem adds further pressure on Intel to define a clear role as the industry evolves.
The AMD-IBM collaboration also reflects a broader trend toward diversification in computing infrastructure. Quantum-classical hybrid systems are expected to rely on varied hardware combinations—ranging from FPGAs and GPUs to quantum processors—to handle different workloads efficiently. AMD’s chips, now proven capable of supporting quantum error correction algorithms, could become essential components in these hybrid frameworks.
From a strategic standpoint, this development offers AMD a path to expand beyond the intense competition of the GPU market, where Nvidia remains far ahead. By focusing on specialized computing through FPGAs and hybrid quantum integration, AMD can address new markets that emphasize flexibility, scalability, and cost efficiency—areas where traditional GPU architectures may be less optimal.
The collaboration also underscores the growing convergence between AI and quantum computing. As IBM’s Chief Quantum Scientist Jay Gambetta has explained, the company’s roadmap focuses on modular quantum systems that can scale through distributed networks. That approach naturally aligns with AMD’s hardware capabilities, allowing it to play a key role in connecting classical and quantum systems within practical, real-world applications.
In the broader market, the success of the AMD-IBM partnership could reshape investor perceptions. The Trump administration on Thursday denied reports that it was in talks to acquire stakes in U.S. quantum companies, reaffirming its commitment to supporting private-sector innovation in advanced technologies, including quantum and AI.
