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• The companies will explore ways to improve patterning control and reduce optical loss.
• Xanadu has also partnered with EV Group and Mitsubishi Chemical in its push to scale photonic quantum computing.
• Xanadu is targeting more than 1,000 logical qubits by 2031 as it works toward fault-tolerant quantum computing.

Xanadu Quantum Technologies (XNDU) shares gained in early morning trade on Wednesday after the company announced a collaboration with ASML (ASML) to develop advanced lithography processes for Xanadu's photonic quantum hardware. 

XNDU stock rose 1.7% in pre-market trading and was among the top-trending tickers on Stocktwits. Meanwhile, ASML stock fell as much as 2.7% amid broader market weakness. 

Platform data showed retail sentiment around XNDU remained in ‘neutral’ territory over the past day, and chatter rose to ‘normal’ from ‘low’ levels, while sentiment around ASML trended in ‘bullish’ territory and chatter increased to ‘high’ from ‘normal’ levels.

Xanadu, ASML Target Optical Loss In Quantum Chips

Xanadu said the collaboration focuses on reducing optical loss in the company’s photonic quantum computing chips. Unlike quantum systems built around trapped ions or superconducting circuits, including those developed by IonQ (IONQ) and IBM (IBM), Xanadu uses particles of light, or photons, to perform computations.

A key manufacturing challenge for photonic chips is optical loss, which can weaken the signals carrying information through the device. Xanadu said that loss can be influenced by line-edge roughness, a measure of how smooth or jagged the microscopic waveguides etched into a chip are.

"Fault tolerance and error correction are arguably the most important technical objectives for the quantum computing industry," said Christian Weedbrook, Xanadu’s founder and CEO.

Xanadu Expands Quantum Manufacturing Efforts

The ASML collaboration adds to Xanadu's broader push to develop the manufacturing infrastructure needed to scale its photonic quantum systems.

Earlier this year, Xanadu partnered with EV Group on heterogeneous integration and wafer-bonding processes to move its chip designs toward high-volume manufacturing. The company also has a separate collaboration with Mitsubishi Chemical focused on applying quantum algorithms to semiconductor fabrication.

Last month, Xanadu said it plans to establish a dedicated research, development and manufacturing facility in Toronto called Inception as part of Project OPTIMISM. 

Xanadu is targeting more than 1,000 logical qubits by 2031, according to a roadmap unveiled in August. Logical qubits are error-corrected qubits designed to be more reliable than the physical qubits that make up a quantum processor. 

Read also: Apple’s Foldable iPhone Could Become The ‘Birkin Of Smartphones’ In China, Analyst Says – But Others Think The Odds Are 4 To 1 Against The Company

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