How Big Is the Quantum Defence Sector?

Introduction

Understanding the size of the quantum defence sector is tricky because the numbers come from very different sources and answer different questions. The only figures that can be checked directly – budgets, disclosed contracts, and company revenue splits – all sit in the low‑hundreds‑of‑millions‑of‑dollars range. By contrast, paid market‑size reports swing between $0.2 billion and $1.9 billion for the same year. This guide separates the four common ways to measure the sector and explains why they cannot be added together.

1. Government Budgets

The Pentagon’s quantum research budget is the most concrete single number. Actual spending was about $320 million in FY 2023, rising to an estimated $400 million in FY 2024, then dropping to a $280 million request for FY 2025. These figures represent money earmarked for internal research and for contracts that the Department of Defense (DoD) awards to external firms and universities. They account for roughly 0.2 % of the overall $143 billion DoD research, development, test, and evaluation request for FY 2025. Within the federal quantum research total (about $1 billion in FY 2023), defence consistently consumes 27‑38 %.

2. Disclosed Contracts

Contract awards are the next verifiable slice. From 2023‑2025, disclosed DoD quantum contracts ranged from $114 million to $141 million per year. In 2026 the figure jumped to $191 million–$223 million (as of 11 Oct 2026) because of two high‑profile DARPA deals with PsiQuantum and Diraq. Excluding those deals, 2026 spending would be around $47 million, lower than any prior year. Obligated (paid‑out) money fell from about $59 million in 2025 to $15 million so far in 2026, reflecting reporting lags.

3. Market‑Size Estimates

Analyst reports try to capture the total spend on quantum technologies across all buyers, including defence. The numbers are wildly inconsistent:

• Low‑end estimates cluster around $0.2 billion for 2024.
• High‑end estimates range from $1.5 billion to $1.9 billion for the same period.

These reports often mix caps, projected contracts, and private‑sector sales, and their methodologies are not publicly disclosed. Averaging them would produce a misleading middle figure that no analyst actually claims.

4. Company Revenue Shares

Some publicly listed quantum firms disclose what portion of their revenue comes from the US government. For example, Rigetti reported 48 % of 2025 revenue from the US government, and Infleqtion about 60 %. Neither breaks out the defence share, and the figures include civilian research contracts, making them an unreliable proxy for defence‑only spending.

Why the Numbers Can’t Be Added

Each measure captures a different slice of the ecosystem:

• Budgets are planned allocations, not necessarily spent.
• Contracts are awarded dollars that later appear as company revenue.
• Market estimates blend budgets, contracts, private sales, and future projections.
• Revenue shares double‑count money already reflected in contracts.

Adding them would count the same dollars multiple times and inflate the sector’s size dramatically.

International Context

Outside the United States, defence‑related quantum spending is reported only in fragmented pieces and often in local currencies. Examples include:

• UK: >£28 million in quantum R&D (no time frame).
• EU: €27 million for a quantum‑sensing project.
• Canada: C$20.3 million over two years for a quantum defence hub.
• Japan: ¥2 billion for quantum‑key‑distribution research in FY 2025.

These figures are too sparse and incomparable to be summed with US numbers.

Practical Takeaway

When discussing the quantum defence sector, cite the verified budget or contract numbers (hundreds of millions per year) and treat market‑size reports as broad, uncertain ranges. Avoid aggregating the four measures; instead, clarify which perspective you are using and why.

--- This guide provides a clear, source‑based view of the quantum defence sector’s size, helping readers separate verifiable data from speculative market estimates.