Meet the next NVDA

TLDR: room-temperature photonic quantum computer that already cracked the networking problem everyone else is stuck on, owns the software layer half the industry codes on, and has government and strategic money coming at it from three directions. Only pure-play photonic name you can actually buy. Long, position at the bottom.

Been holding 1000 shares of XNDU for a while and been asked why:

Most quantum companies chill a chip down to near absolute zero and try to jam more qubits onto it. Xanadu doesn't. Their qubits are photons, literally light, so the machine runs at room temperature and the photons move around on ordinary fiber.

The real wall in quantum was never building a handful of decent qubits. It's wiring enough of them together to do useful work without the cost going parabolic. Last year Xanadu dropped a machine called Aurora in Nature. Four server racks built from 35 photonic chips and around 13 km of fiber, all running at room temp. Aurora isn't powerful. Not the point. The point is you can pull a rack out and it still works, and you can keep bolting on thousands more on the same architecture. Weedbrook, the CEO, just came out and said "Xanadu has now solved scalability". Hard to argue his logic: a million qubits is never fitting on one chip, so modular networking is the only road there, and that's the piece nobody else had done.

Weedbrook says their planned data center only needs cryogenics for about 10% of the system, the small part that creates and reads the qubits. IBM and Google keep the whole machine cold. Less refrigeration, off-the-shelf fiber, chips coming off semiconductor lines that already exist. You tell me which one scales into a data center cheaper. The target is a fault-tolerant quantum data center in Canada by 2029.

Their software is what actually got me to buy. Xanadu owns PennyLane, and the cleanest way to put it is, it's the PyTorch of quantum. It took differentiable programming, the same autodiff idea behind PyTorch and TensorFlow, and made it run on quantum circuits, and it plugs straight into PyTorch, TensorFlow, and JAX. The whole goal was to take the best parts of modern deep learning software and make them native to quantum.

The moat is PennyLane doesn't only run on Xanadu hardware. It runs on IBM, Google, Amazon, etc. More than half the world's quantum developers already use it, roughly 35,000 of them, pulling around 200,000 downloads a month, and it's now running on the Frontier supercomputer through Oak Ridge. Whoever owns the default software layer of a new kind of computing basically owns the category. Nvidia and CUDA, etc. So even if some rival hardware ends up winning the race, those developers are still building on Xanadu's software and Xanadu collects anyway.

Everyone points at PsiQuantum, the private one that's raised over $2 billion. Two reasons I'd rather own Xanadu. One, you literally can't buy PsiQuantum, it's private. Xanadu is the first pure-play photonic quantum company to go public, so retail actually has a way in. Two, the physics. PsiQuantum bets on single photons, where you lose the bit the instant you lose the photon. Xanadu uses squeezed light, which shrugs off loss better because the light field doesn't blink out when one photon goes missing. That tolerance is a big reason they think they move faster, and it's why they're the ones who shipped the networking breakthrough first, on a fraction of PsiQuantum's money. Put PennyLane on top of that and Xanadu's the only one holding both the hardware milestone and the software standard.

Xanadu is also one of a short list of companies DARPA moved into Stage B of its Quantum Benchmarking Initiative, and Stage B already freed up to $15 million. The program exists to figure out which quantum approach can actually reach useful scale by 2033. Stage B is a year-long review that started late 2025, and whoever clears it advances to Stage C, where DARPA validates the design can really be built and run as promised. So if they pass, they're into Stage C around late 2026, and the program is dangling up to roughly $316 million USD for the teams that go all the way.

On top of the US money, they're in the final stage of negotiations on up to $390 million CAD (call it $285 million USD) from the governments of Canada and Ontario for Project OPTIMISM, to build chip and photonics manufacturing at home.

Nvidia is backing them, and AMD holds a direct equity stake in Xanadu. Hope you all become millionaires with me.