Canadian

startup

Xanadu Quantum Technologies Inc.

rallied after a rocky start in

public markets

, buffeted by souring sentiment toward equities.

After merging with a blank-check company, the new United States shares of Xanadu initially jumped more than 10 per cent

on Nasdaq

, from the closing level of the special purpose acquisition company. The stock suddenly reversed course, sinking nearly 10 per cent before regaining its footing to trade up 20 per cent at US$11.64 at 3:48 p.m. in New York. The company also listed on the

Toronto Stock Exchange

, trading under the separate ticker XNDU CN.

Xanadu announced plans to go public in November, with the promise to build one of the first

quantum data centre

s by 2030. At the time, shares of

quantum firms

were hitting all-time highs on optimism for the technology. But these stocks have turned lower as investors reassess outlooks.

It’s a trajectory reflected in

technology stocks

more broadly, with the Nasdaq 100 sliding more than 10 per cent, the threshold for a technical correction, from its October high. The selloff in equities comes as the Iran war fuels risk-off sentiment and concern mounts over payoffs from high level of spending on artificial intelligence.

One case in point is Infleqtion Inc. In February, shares in the company surged upon going public, but have since tumbled — they sank as much as 9.3 per cent Friday, along with other quantum names.

Quantum firms are currently burning cash and typically carry valuations disproportionately high compared to their sales. Xanadu said in a regulatory filing its revenue was US$2.7 million for the first nine months of 2025.

Xanadu’s merger with the SPAC Crane Harbor Acquisition Corp. didn’t bring the expected US$500 million in proceeds as the redemption rate from its shareholders reached about 88 per cent prior to the approval. The transaction will earn Xanadu US$302 million before fees.

Xanadu, founded in 2016 by chief executive Christian Weedbrook, builds quantum computers designed to send photons, or light, through fibre optic connections. The system, still at a developmental stage, can mostly operate at room temperature, making it potentially more scalable than other quantum technologies, according to the company.

The public market debut “signals to the industry that we’re not too far away now from the end vision of having a large scale quantum computer,” Weedbrook told BNN Bloomberg on Friday. “We’ve publicly stated that we’re aiming to achieve that in 2029, 2030.”

The company needs plenty of cash to run and test semiconductors, bring down the error rate of its machines, and create the engineering and manufacturing capabilities for its proposed US$1 billion quantum data centre in the Toronto region. It’s in talks with the Canadian and Ontario governments for as much as $390 million.

Lockheed Martin Corp., Advanced Micro Devices Inc., Rolls-Royce Holdings and Tower Semiconductor are among Xanadu’s customers and partners.

Bloomberg.com

  • Toronto quantum company Xanadu set to debut on TSX, Nasdaq in SPAC deal
  • Xanadu teams up with Telus to build Canadian quantum computing infrastructure