IonQ agrees to buy Elisity in stock deal worth up to $1.3 billion including contingent payment
Key Facts
Quantum computing and technology company IonQ has agreed to buy cybersecurity company Elisity in an all-stock deal worth up to $1.3 billion, according to the Wall Street Journal. The deal was announced on October 12, 2026, expanding the company's security offerings by combining its quantum technologies with Elisity's enterprise security platform. The parties signed the merger agreement on October 9, 2026, according to IonQ's filing with the U.S. Securities and Exchange Commission. The announced consideration includes an earnout of up to $150 million, contingent on Elisity's business performance, according to an IonQ statement. The acquisition aims to link the buyer's encryption and key protection capabilities with the target's zero-trust security technologies.
The merger agreement set the base consideration payable at closing at $1,150,000,000 in stock, according to the regulatory filing dated October 13, 2026. This amount is subject to contractual reductions for leakage before the final consideration is determined under the agreement. The parties also set limits on the IonQ share price used to calculate the shares issued as acquisition consideration. The agreement capped that price at $49.61 per share, according to the terms in the filing. The floor was set at $33.07 per share under the mechanism for pricing the consideration at closing.
IonQ said the deal combines its post-quantum cryptography and quantum key distribution capabilities with Elisity's enterprise security platform. The target company's platform uses a zero-trust approach alongside network microsegmentation technology. Elisity described the technology's role, saying that "microsegmentation is essential to containing attackers' lateral movement within compromised networks." Against the backdrop of efforts to modernize encryption, the U.S. National Institute of Standards and Technology urged computer system administrators to begin transitioning to the new standards resistant to quantum attacks. The institute called for the transition to be carried out "as quickly as possible" in its guidance on adopting the new encryption standards.
Elisity has more than 100 customer deployments worldwide, according to IonQ. The buyer said Elisity has a track record of doubling revenue year over year. It added that the target company's customer base had also doubled year over year and that it had lost no customers among enterprises that deployed its platform. Elisity announced a $37 million Series B funding round in April 2024. Insight Partners led the round, according to Elisity's funding announcement. The company's total funding at the time rose to more than $72 million, according to the round's announcement. Elisity later announced investments from TCV and Chevron Technology Ventures.
The deal follows IonQ's announcement of second-quarter 2026 revenue of $80.1 million, which Chairman and Chief Executive Niccolo de Masi said "exceeded our guidance again." Chief Financial Officer and Chief Operating Officer Inder Singh said revenue for the quarter grew 287% year over year. In its September update preceding the announcement of the Elisity acquisition, IonQ forecast annual revenue of between $450 million and $460 million in 2026. That forecast included a contribution from SkyWater following its acquisition, according to the financial guidance update. In premarket trading on October 12, 2026, IonQ shares fell 2.4%, according to Investing.com's coverage on the day the deal was announced.
The acquisition agreement also includes a retention program for Elisity employees who will continue working after the deal closes, according to IonQ's regulatory filing. The program consists of restricted stock units calculated on the basis of $100,000,000, in addition to the merger consideration. James Winebrenner said he would continue to lead Elisity as chief executive after the acquisition closes, stating in the company's announcement: "I will continue as CEO." The companies expect the deal to close in the fourth quarter of 2026, according to Elisity's statement. Completion remains subject to customary closing conditions, including the required regulatory approval.