IonQ (IONQ) reported a Q3 beat and raised its 2026 revenue guidance as demand builds for its Superion 256 quantum computers, Morgan Stanley said in a Friday note.

The company reported a Q3 adjusted loss late Thursday of $0.29 per share, compared with analyst expectations for a loss of $0.35, while revenue was $173.8 million, above consensus of $141.5 million. Management now expects quantum computing revenue to grow 110% in 2026, compared with about 100% organic growth forecast last quarter.

The company's broader platform segment grew 127% year over year, driven by global deployments of its Tempo systems, Morgan Stanley said.

IonQ has sold out its Superion 256 capacity for 2027, with orders filling into 2028, according to the note. The company also signed new systems contracts worth $33 million and $25 million, while Nvidia (NVDA) plans to install a Superion 256 as its first on-premises quantum processing unit in 2027, the investment firm said.

Morgan Stanley maintained its equal-weight rating on IonQ and lowered its price target to $40 from $43.

IonQ shares were 11.4% higher in Friday trading.

Price: 29.45, Change: +3.02, Percent Change: +11.43