Quantum computing startup PsiQuantum has entered into a $125 million agreement with the U.S. Defense Advanced Research Projects Agency — the biggest U.S. government contract the company has secured so far.
The agreement is part of DARPA’s Quantum Benchmarking Initiative, a program designed to assess whether a practically useful quantum computer can realistically be constructed by the year 2033. The funding will go toward evaluating PsiQuantum’s hardware and software systems. It comes after the company previously received a $31.8 million DARPA contract in September 2025.
PsiQuantum Chief Executive Victor Peng spoke about the significance of the DARPA review process, saying it would help clarify for the entire industry “what’s real and what’s not.” He added that the company anticipates its first commercial-scale quantum machine will be up and running by approximately 2030.
“We can do simulations and solve problems that traditional computing, even for the next few centuries, won’t solve,” Peng said.
PsiQuantum was established in 2016 and takes a photonics-based approach to quantum computing — relying on light-based technology similar to what powers fiber-optic internet cables. Its chips are produced at GlobalFoundries in New York. Last September, the company raised $1 billion at a valuation of $7 billion in a funding round led by BlackRock, Temasek, and Baillie Gifford, with Nvidia’s venture investment arm also taking part.
This latest deal adds to a growing relationship between PsiQuantum and the federal government. In May, the Commerce Department announced plans to take minority ownership stakes in nine quantum technology companies in exchange for $2 billion in funding under the CHIPS Act. Under that arrangement, IBM is set to receive $1 billion, GlobalFoundries $375 million, and PsiQuantum $100 million — though those agreements have not yet been finalized.
Peng, who previously served as president of Advanced Micro Devices, was officially named permanent CEO this month after stepping into the role on an interim basis in February. Intel CEO Lip-Bu Tan joined PsiQuantum’s board of directors in April, and the company has recently brought on executives with backgrounds at memory chipmaker Sandisk and chip design software company Synopsys.
