NASHUA, N.H. — The Pentagon is putting approximately $350 million toward quantum computing. The initiatives include testing competing technologies, expanding domestic manufacturing and identifying problems that future quantum systems might solve.

Related: DoD announces $350 million in quantum computing initiatives

What is the Pentagon's $350 million quantum computing initiative?

The package brings together two different funding efforts. First, DARPA is directing approximately $200 million in new funding toward its Quantum Benchmarking Initiative (QBI), which looks at whether companies can develop quantum computers that perform useful work at a practical cost.

The remaining $150 million is a conditional loan commitment from the Pentagon's Office of Strategic Capital to PsiQuantum. The proposed financing would support the company's manufacturing and prototyping capabilities in the United States.

Unlike a research grant, the loan remains subject to financial, legal, technical and other requirements before closing.

How does quantum computing work?

Conventional computers process information using bits, which represent either a zero or a one. Quantum computers use quantum bits, or qubits, that can exist in combinations of states through a property called superposition.

Qubits can also exhibit entanglement, so their quantum states become correlated in ways that classical bits cannot reproduce. These properties let quantum algorithms approach certain calculations differently from conventional software. However, quantum computers are not automatically faster at every task.

Building useful systems is still difficult because qubits are sensitive to disturbances that introduce errors. Researchers must create reliable hardware, control those errors and scale their systems without losing the quantum behavior needed for computation.

What is DARPA testing?

DARPA launched QBI in 2024 to assess whether companies could develop an industrially useful quantum computer by 2033. The agency considers a quantum computer economically useful when its computational value exceeds the cost of building and operating it.

DARPA is evaluating several approaches to quantum computing. In October, the agency advanced Atom Computing, Diraq, IBM and IonQ to Stage C, the program's final evaluation phase. Microsoft and PsiQuantum had previously reached the equivalent evaluation phase through DARPA's Underexplored Systems for Utility-Scale Quantum Computing (US2QC) pilot program.

The companies use different technologies, including neutral atoms, silicon-based qubits, superconducting processors and trapped ions.

During Stage C, government evaluators examine whether the proposed systems can be built as designed and operate as intended. The work moves beyond reviewing development plans to checking hardware and engineering progress.

Each approach has different engineering challenges. For instance, some require extremely low temperatures, while others depend on precise control of individual atoms or particles of light. By looking at multiple designs, DARPA can compare how companies address these roadblocks and whether their systems have a realistic path toward larger, more reliable quantum computers.

Advancing to Stage C does not mean a company has already produced an industrially useful quantum computer, though.

Why is PsiQuantum receiving separate support?

PsiQuantum is developing quantum computers that use particles of light, called photons, to process information. Unlike approaches that rely on atoms or superconducting circuits, its technology uses photonic components to manipulate quantum information.

The company is also participating in DARPA's benchmarking effort, although its conditional loan commitment is separate from QBI funding.

How could quantum computing support military technology?

The Pentagon is interested in whether quantum computers could eventually help researchers model complex chemical reactions, study new materials and solve problems that overwhelm conventional computing systems. Such capabilities could support the development of new components and manufacturing methods.

Before January 2027, DARPA plans to begin workshops with federal research organizations, military users and quantum-algorithm specialists to uncover national security problems that quantum computers might eventually address.

For now, the Pentagon's $350 million effort is focused on answering whether companies can build quantum computers that deliver practical value and where those machines could eventually serve national security needs.