NEC, the Japanese tech giant that helped launch the superconducting quantum computing era, has officially stopped developing quantum computer hardware. The company pulled the plug at the end of March 2026, closing a chapter that began nearly three decades ago with one of the most consequential breakthroughs in the field.
The reason is brutally simple: the money doesn’t make sense. NEC concluded that the timeline to commercially viable quantum systems was too long, and the return on investment too uncertain, to keep pouring resources into hardware development while US firms like IBM and Google continue to outspend and outscale Japanese competitors.
From pioneer to pragmatist
This isn’t some bit player exiting the quantum race. In 1999, NEC demonstrated the world’s first superconducting solid-state qubit, a breakthrough that essentially laid the groundwork for the architectures IBM and Google later adopted and scaled into multi-hundred-qubit processors.
The company isn’t abandoning the quantum space entirely, though. NEC plans to redirect its focus toward quantum annealing, a more specialized approach to optimization problems, along with quantum-inspired computing that runs on conventional hardware. The strategy centers on software development, industrialization efforts, and proof-of-concept work.
Brain drain to Fujitsu
Perhaps the most telling consequence of NEC’s withdrawal is where its talent is heading. Many of the company’s quantum researchers have reportedly moved to Fujitsu, which is aggressively pushing ahead with its own hardware development program. Fujitsu partnered with Riken, Japan’s largest research institute, in 2025 as part of its effort to build competitive quantum systems.
That talent migration effectively consolidates Japan’s quantum hardware ambitions around a single major corporate player. For a country that has made quantum technology and AI central pillars of its national technology strategy, having its quantum hardware future depend largely on one company and its government-backed research partnerships is a notable concentration of risk.
What this means for the quantum landscape
NEC’s pivot toward software, services, and quantum-inspired solutions on classical hardware reflects a broader industry trend. Several companies have found that you can capture meaningful commercial value from quantum algorithms and optimization techniques without actually building a quantum computer.
Fujitsu now stands as Japan’s primary corporate standard-bearer in quantum hardware, with its Riken partnership providing both institutional credibility and access to government-funded research infrastructure.