Short seller claims IonQ lost 'vital' US government contracts
IonQ, Inc.'s (IONQ) stock sank 8.1% on Wednesday following a new short seller report that claims the quantum computing company has lost funding for "vital Pentagon contracts" that were responsible for 86% of its revenue from 2022-2024.
Wolf Pack Research said that the loss of funding for the contracts has left a "54.6 million black hole in its expected quantum computing revenues."
"Critically, the validation that these contracts represented for IONQ's technology, propelling their valuation sky-high, turns out to be an illusion," the report said.
"The Pentagon never requested funding for these contracts, instead the Pentagon was directed to make them via secretive 'backdoor earmarks' by politicians friendly to IONQ who are now out of power."
IonQ has a $12.2 billion market cap, riding a wave of investor enthusiasm that sent a number of quantum computing stocks soaring last year. Among its achievements in 2025, the company touted its work with the US Air Force and also launched its IonQ Federal unit to support the US and allied governments.
However, Wolf Pack notes that in the bipartisan Congressional budget for FY 2026, "funding for their largest Pentagon contract is, for the second consecutive year, completely gone."
The report also claims that "only $21 million of its supposed $75.6 million in Pentagon contracts booked in 2024" had been funded for FY 2025.
Wolf Pack implies that the "black hole" in its revenue from the loss of funding for its Pentagon contracts led to the resignation of former IonQ CEO Peter Chapman in 2025 after he had "won and touted these contracts."
The loss of money also led to massive insider stock sales totaling $396.6 million, the report said.
Wolf Pack accuses current CEO Niccolo de Masi of trying to "backfill IONQ's lost money from the Pentagon" by making acquisitions in "subpar non-quantum computing businesses" that include Capella, a satellite imagery company, Vector Atomics, an atomic clock maker, and its proposed acquisition of SkyWater Technology, the largest U.S.-based pure-play semiconductor foundry.
About that acquisition of SkyWater, Wolf Pack calls it "particularly puzzling and shatters the idea IONQ is a quantum pure-play."
"If IONQ was really making terrific progress developing and commercializing a quantum computer, then why are they rolling up all these random businesses?" the firm said. "Who does IONQ think they are fooling?"
According to Wolf Pack, these acquisitions have worsened IonQ's cash flow from its operations, claiming that it has dropped from negative $33 million in Q4 2024 to negative $123.1 million in Q3 2025.
"Who is really holding the bag here now that the Pentagon is out?" the report states. "It looks like retail, who now get to pay in cash and dilution for loss generating businesses."
IonQ last week announced that it is acquiring Seed Innovations, a Colorado-based software and technology R&D firm focused on both government and commercial customers.
The company said in an SEC filing that it would be an all-stock transaction consisting of up to 1,171,868 shares.
IonQ has not yet publicly responded to the Wolf Pack report.