Financial Data and Key Metrics Changes - Revenues in Q3 2025 were $1.9 million, down from $2.4 million in Q3 2024, impacted by the expiration of the National Quantum Initiative [12] - Gross margins in Q3 2025 were 21%, compared to 51% in Q3 2024, due to revenue composition and pricing variability [12][13] - Operating loss for Q3 2025 was $20.5 million, compared to $17.3 million in the prior year [14] - GAAP net loss for Q3 2025 was higher than in Q3 2024, with a non-GAAP net loss of $10.7 million, or $0.03 per share, compared to $13.4 million, or $0.07 per share, in Q3 2024 [15] - As of September 30, 2025, the company had approximately $558.9 million in cash and equivalents, with no debt [15] Business Line Data and Key Metrics Changes - The company announced purchase orders totaling approximately $5.7 million for two 9-qubit Novera quantum computing systems, which are upgradable [6][7] - A three-year, $5.8 million contract from the Air Force Research Laboratory (AFRL) was announced to advance superconducting quantum networking [8] Market Data and Key Metrics Changes - The expiration of the National Quantum Initiative and its pending reauthorization in the U.S. Congress impacted revenue [12] - The company is engaged with various academic and government sectors to enhance quantum computing capabilities [9][10] Company Strategy and Development Direction - The company plans to deliver a 150-plus qubit system by the end of 2026 and a 1,000-plus qubit system by the end of 2027, with anticipated gate fidelity improvements [5][6] - The company is focusing on public-private partnerships to advance quantum technologies [9] - The company intends to open an Italian subsidiary to pursue business opportunities in the region [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future sales driven by recent contracts and collaborations, despite current revenue challenges [12][15] - The company is optimistic about being selected for phase B of the DARPA Quantum Benchmarking Initiative project in the coming months [10][18] Other Important Information - The company is exploring options for a new chip fab facility to enhance capabilities beyond the current 150 mm fab [63][66] - The potential investment for a new quantum fab is expected to be in the hundreds of millions of dollars, significantly less than a CMOS fab [66] Q&A Session Summary Question: Can you discuss the DARPA phase B and the feedback received? - Management noted that while not selected for phase B, constructive feedback was received, focusing on error correction and long-range coupling [17][18] Question: What is the comfort level for achieving 99% fidelity by 2027? - Management is confident in achieving 99.7% fidelity at 150-plus qubits by 2026 and 99.8% at 1,000 qubits by 2027 [21][22] Question: Will the 1,000-qubit system use chiplet-based architecture? - The plan is to use 36-qubit chiplets for the 1,000-qubit system, with confidence in achieving the fidelity targets [27][28] Question: How will revenue recognition work for the Novera system sales? - Revenue for the two Novera systems will be recognized upon shipment, expected in Q1 and Q2 of 2026 [31] Question: What is the expected impact of the National Quantum Initiative funding? - The recent reinstatement of funding to $625 million over five years is seen as a positive step, though discussions for higher funding amounts are ongoing [88][89] Question: What is the company's strategy regarding potential M&A? - The company is open to exploring M&A opportunities to accelerate its roadmap but believes it can execute its plans organically [50][51]

Group 1: Company Overview - Mengyun Holography (HOLO.US) expects to achieve a net profit exceeding RMB 350 million for the year 2025, a significant turnaround from a net loss in the previous year [1] - The company reported a net loss of approximately RMB 63 million for the entire year of 2024 [1] - Mengyun Holography currently holds over RMB 3 billion in cash, cash equivalents, and short-term investments [1] - The company plans to allocate over $400 million from its cash reserves to invest in quantum computing, blockchain, and quantum holography technologies [1] Group 2: Industry Trends - The quantum computing sector in the U.S. stock market has seen a strong performance, with Mengyun Holography experiencing a pre-market surge of over 17% following positive news [2] - Recent developments, including the U.S. government's consideration of using federal funds to acquire equity in quantum computing companies, have led to a collective rise in quantum sector stocks [2] - Key players in the quantum computing field, such as IonQ, Rigetti, and D-Wave, have also seen significant stock price increases, reinforcing expectations of a "national-level track" premium [2] - Industry experts believe that the quantum computing field is approaching critical milestones, with the potential for achieving "quantum advantage" and "quantum supremacy" within the next three to five years [2][3] - IonQ's CEO has indicated that the era of "quantum supremacy" is imminent, marking a significant threshold where quantum processors can outperform classical supercomputers on specific tasks [3] - Quantum computing systems leverage quantum mechanics properties, such as superposition and entanglement, to provide a new computing paradigm that could vastly exceed traditional binary computers in certain areas [3]

Core Viewpoint - Quantum computing is rapidly transitioning from a laboratory concept to a central focus in geopolitical competition, with significant implications for national security and technological advancement [3][4]. Group 1: Technological Breakthroughs - Major U.S. quantum computing companies, including IonQ, have achieved significant technological milestones, with IonQ announcing a 99.99% gate fidelity breakthrough, indicating that "quantum advantage" could be reached within three to five years [3][6]. - Quantum advantage is defined by four criteria: at least 1,000 qubits, at least 99.9% fidelity for two-qubit gates, a maximum gate speed of 15 nanoseconds, and some form of error correction [6]. - The potential for quantum computing to solve large-scale optimization problems far exceeds that of traditional computers, which operate on binary systems [6]. Group 2: National Security Implications - Quantum computing poses a significant threat to existing encryption systems, with the ability to potentially crack sensitive communications in government, banking, and healthcare sectors [4][8]. - Governments are accelerating investments in post-quantum cryptography to safeguard against potential quantum attacks [4]. - The geopolitical landscape is intensifying, with China committing over $15.3 billion to quantum technology, significantly outpacing the U.S. government's $3.2 billion investment [4][10]. Group 3: Market Dynamics and Investment - The optimism surrounding quantum technology stocks has been reignited, despite many companies in the sector not yet achieving profitability [3][6]. - Financial institutions, including JPMorgan Chase, are actively investing in quantum computing as part of broader strategies to enhance national economic security [9][10]. - The integration of artificial intelligence with quantum computing is expected to unlock new levels of technological advancement, with AI accelerating quantum development and vice versa [10].

Core Insights - Major US quantum computing companies like IonQ are achieving technological breakthroughs, with predictions of reaching "quantum advantage" within 3-5 years, which could disrupt existing encryption systems and pose security threats to critical sectors like government and finance [1][3][4] Group 1: Technological Advancements - IonQ has announced a breakthrough with 99.99% gate fidelity, leading to optimism about achieving "quantum advantage" within a critical timeframe of 3-5 years [3][6] - Quantum advantage is defined by four criteria: at least 1000 qubits, at least 99.9% fidelity for two-qubit gates, gate speed of no more than 15 nanoseconds, and some form of error correction [6] - The transition from academic interest to a national security imperative is driven by the potential of quantum computing to solve complex problems traditional computers cannot handle [6][10] Group 2: Geopolitical Context - The competition between the US and China in quantum technology is intensifying, with China investing over $15.3 billion compared to the US's $3.2 billion [4][10] - Quantum technology is now viewed as a critical infrastructure, with significant government funding and strategic investments from major tech companies [9][10] Group 3: Investment Trends - The market is experiencing a surge in investment interest, with companies like Rigetti Computing seeing stock price increases of up to 3100% despite not yet achieving profitability [6][9] - Financial institutions are also ramping up their investments in quantum computing, with JPMorgan Chase announcing a $1.5 trillion plan that includes quantum technology as a key focus area [9] Group 4: Security Implications - The ability of quantum computers to break existing encryption methods poses a dual threat and opportunity, leading to increased government focus on post-quantum cryptography [8][9] - The Biden administration has enacted legislation to prepare federal systems for quantum threats, emphasizing the urgency of transitioning to quantum-resistant encryption [8][9]

Core Insights - Google's quantum AI lab announced a significant breakthrough with the "quantum echo" algorithm, achieving the first "verifiable quantum advantage," marking an important step towards practical applications of quantum computing within the next five years [1][2] Group 1: Quantum Advantage Claims - This is not the first time Google has claimed quantum advantage; in 2019, they announced the "Sycamore" processor, which completed a task in about 200 seconds that would take the best supercomputer approximately 10,000 years [2] - In December 2024, Google introduced the "Willow" chip, which can perform tasks in 5 minutes that would take the fastest existing computer 10^25 years, also featuring strong error correction capabilities [2] - The core value of the new breakthrough lies in its speed, with the "quantum echo" algorithm running approximately 13,000 times faster than the best classical algorithm on the fastest supercomputer [2] Group 2: Potential Applications - A collaborative demonstration with the University of California, Berkeley, showcased the potential of enhanced nuclear magnetic resonance technology to provide more information about molecular structures, likened to how telescopes and microscopes reveal previously unseen worlds [3] - The enhanced nuclear magnetic resonance technology is expected to play a role in drug development and material science, analyzing molecular structures of new materials [3] - The head of Google's quantum AI lab expressed optimism that practical applications exclusive to quantum computers could be realized within five years [3] Group 3: Skepticism and Challenges - Some researchers express caution regarding Google's claims, suggesting that it may be premature to promise immediate practical applications [4] - Concerns were raised about the need for further evidence to prove the absence of more efficient classical algorithms, with some experts deeming the current advancements impressive but not immediately applicable to economically viable problems [4] - The journey to develop a practical universal quantum computer remains lengthy, despite significant breakthroughs in the field since Richard Feynman proposed the concept in 1981 [4]

Market Performance - Major A-share indices experienced a strong rally, with the Shanghai Composite Index breaking previous highs and reaching a new high for the year at 3938.98 points, up 0.42% [1] - The Shenzhen Component Index rose by 1.3% to 13195.25 points, while the ChiNext Index increased by 2.09% to 3126.05 points [1] - The total trading volume in the Shanghai and Shenzhen markets reached 1.23 trillion yuan, indicating a significant increase in trading activity [1] Sector Performance - The technology growth sector showed strong performance across the board, with notable activity in storage chips, computing hardware, quantum technology, and commercial aerospace [2][5] - Specific stocks such as Shengyi Electronics surged by 20% to hit the daily limit, while other companies like Zhongji Xuchuang and Xiangnong Chip Innovation reached new highs [2][5] - The storage chip sector saw a collective rise in stock prices, driven by strong demand and supply constraints, with Zhongji Xuchuang increasing over 6% and Shengyi Electronics achieving a 20% limit up [5][8] Quantum Technology Developments - The quantum technology sector remained active, with companies like Dahua Intelligent and Geer Software achieving consecutive gains [10] - Recent advancements in quantum computing were reported, including Google's announcement of a verifiable quantum advantage and significant progress by China Telecom in quantum key distribution [13] - Analysts noted that quantum computing is becoming a disruptive frontier technology, with ongoing research and development expected to yield substantial progress in the next 5 to 10 years [13]

Group 1: Economic and Policy Developments - The 20th Central Committee of the Communist Party of China approved the "15th Five-Year Plan" proposal, emphasizing high-quality development, technological self-reliance, and significant improvements in social civilization and living standards by 2035 [3] - The Ministry of Commerce announced that a delegation led by Vice Premier He Lifeng will engage in economic and trade consultations with the U.S. from October 24 to 27, focusing on key issues in Sino-U.S. economic relations [3] - The Ministry of Commerce reported that as of October 22, 2025, the number of applications for the vehicle trade-in subsidy exceeded 10 million, with new energy vehicles accounting for 57.2% of the total [3] Group 2: Industry Insights - The China Rare Earth Group held a meeting to discuss the economic operation for Q3 2025, emphasizing strict implementation of export control policies and enhancing governance levels [3] - The report from the Ministry of Natural Resources indicated that in 2024, geological exploration investment reached 115.99 billion yuan, marking four consecutive years of growth [3] - The banking industry reported that as of Q3 2025, the number of existing bank wealth management products reached 43,900, with a total scale of 32.13 trillion yuan, reflecting a year-on-year increase of 9.42% [3] Group 3: Corporate Announcements - New Lai Materials announced plans to invest 2 billion yuan in a semiconductor core component project in Kunshan, expected to generate an annual output value exceeding 1.5 billion yuan upon reaching full production [4] - The company Yihua Lithium Energy reported a year-on-year net profit increase of 15.13% for Q3 2025 [7] - The company Enginex reported a remarkable year-on-year net profit growth of 244.89% for Q3 2025 [7]

Core Insights - The research published in the journal "Nature" discusses a method called "time reversal" to probe quantum dynamics, potentially enhancing the performance of quantum computers [1][4]. Group 1: Research Overview - The study is conducted by Google's Quantum AI team and collaborators, focusing on measuring out-of-time-order correlators (OTOC) in superconducting quantum processors [1][4]. - The long-term goal of quantum computing is to create machines that can outperform classical computers in specific practical tasks, which requires overcoming challenges such as noise reduction and defect management [4]. Group 2: Methodology and Findings - The research proposes using time reversal to track the quantum dynamics of numerous components in a system, which is crucial for distinguishing genuine quantum effects from classical noise [4]. - The team successfully measured high-order OTOC using a time-reversal scheme, finding that the observable quantities remain sensitive to true quantum effects over sufficiently long time scales [5]. Group 3: Implications and Future Applications - Measuring OTOC can reveal microscopic properties of quantum systems that classical computation cannot access, increasing the potential for robust demonstrations of quantum advantage in future applications [5]. - The circuits used in the study are simplified models, but the approach is applicable to real physical systems, indicating broader implications for quantum computing research [5].

Core Insights - A recent study published in *Nature* reports advancements in detecting quantum dynamics through a "time-reversal" scheme by Google's Quantum AI team and collaborators [1] - The long-term goal of quantum computing is to create machines that achieve quantum advantage, surpassing classical computers in specific practical tasks [1] Group 1: Quantum Computing Advancements - The research addresses challenges in quantum computing, particularly the need to reduce noise and overcome defects to achieve quantum advantage [1] - A significant issue is the detection of quantum dynamics in systems with many components, which can be unpredictable and difficult to track [1] Group 2: Time-Reversal Scheme - The team utilized the "time-reversal" method in a superconducting quantum processor to measure out-of-time-order correlators (OTOC), which are essential for characterizing chaotic behavior in quantum systems [1] - The experiment demonstrated sensitivity to genuine quantum effects over sufficiently long time scales, allowing for substantial sampling of the processor during the propagation and reversal dynamics [1] Group 3: Implications for Future Research - Measuring OTOC can reveal microscopic properties of quantum systems that classical computing cannot access, enhancing the potential for robust demonstrations of quantum advantage in the future [2] - The circuits used in the demonstration are simplified models, but the findings suggest applicability to real physical systems [2]

Core Insights - An international collaborative research team from Denmark, the United States, Canada, and South Korea has experimentally demonstrated the capability of quantum technology to significantly outperform classical methods, achieving a task completion time reduction from 20 million years to just 15 minutes, thereby realizing "quantum advantage" [1][2] Group 1: Research Findings - The research addresses a common challenge in efficiently understanding complex and noisy physical systems, where traditional methods require extensive measurements to infer system behavior characteristics [1] - The team introduced a unique quantum resource, entangled light, to overcome measurement challenges, as measuring quantum systems can disturb them and the required measurement frequency grows exponentially with system size [1][2] Group 2: Experimental Methodology - The experiment utilized standard optical components and communication band light, preparing two entangled beams of squeezed light, one for probing the target system and the other as a reference [2] - By conducting joint measurements on the two beams, the team was able to extract more effective information at once, significantly reducing measurement ambiguity [2] Group 3: Implications and Applications - The results indicate a remarkable efficiency improvement not due to more precise equipment but rather the quantum advantage of the measurement method itself, achieved in a realistic lossy system [2] - This breakthrough not only highlights the speed enhancement but also showcases the potential applications of quantum technology in fields such as sensing, system identification, and machine learning [2]