Intel Buys Israeli Quantum Computing Firm Classiq for $2.3 Billion

Intel has announced its acquisition of Israeli quantum computing software company Classiq for $2.3 billion, a significant move in the burgeoning quantum computing sector. Founded six years ago, Classiq specializes in software for designing and operating applications for quantum computers. The company's operations are expected to remain primarily based in Israel, which will become a strategic hub for Intel's quantum ambitions.

Classiq's co-founder and CEO, Nir Minervi, revealed that the company had been close to an initial public offering (IPO) before accepting Intel's offer. "We were on the verge of going public," Minervi stated, noting that a listing, potentially via a SPAC or a traditional IPO, had been seriously considered. He explained that Intel's offer was strategically appealing due to the tech giant's existing quantum computing technologies, chip manufacturing capabilities, control systems, and supercomputers. Classiq's software layer, he added, will enable users to leverage these infrastructures, drawing parallels to the roles of DOS in personal computing and CUDA in graphics processing units.

Intel intends for Classiq to serve as the software cornerstone of its quantum computing business. Crucially, the acquisition is not expected to lead to the relocation of Classiq's activities out of Israel. Minervi emphasized that Intel views Classiq as the "strategic and commercial leader" for its quantum endeavors, encompassing software, hardware, business development, and strategy, all to be managed from Israel. Classiq will operate as an Intel business unit while largely maintaining its current organizational structure.

The startup, which employs approximately 140 people, collaborates with major international corporations including BMW, Lufthansa, AT&T, HSBC, and Comcast. In Israel, Classiq works with entities such as the Bank of Israel, Deloitte, ICL, Ichilov Hospital, and the defense industry. The company also cooperates with tech giants like Microsoft, Amazon, IBM, and Nvidia.

Minervi acknowledged that the quantum computing market is still in its early stages and has not yet generated substantial commercial value for users. However, he noted that large enterprises are investing to prepare their teams, software, and intellectual property for a technology that is poised to profoundly transform computing in the coming years.