IBM shares rose at Wednesday's open after the company said it had successfully integrated and cooled two cryogenic modules for its quantum computing platform, a development that advances its plan for a fault-tolerant quantum supercomputer called Starling.

Shares of International Business Machines Corporation opened at $232.74, up 1.7%, giving the company a market value of $219.27 billion.

The computing pioneer said the newly integrated modules form the foundation for linking hundreds of quantum processors in a single ultra-cold operating environment. IBM said the achievement moves it closer to Starling, which it expects to deploy before the end of the decade.

Fault tolerance allows a system to keep working even when some components fail. In quantum computing, where calculations rely on fragile quantum states, that capability has long been one of the industry's biggest technical challenges. IBM is not alone in pursuing it: Google said in late 2024 that its Willow chip had demonstrated error rates falling as more qubits were linked together, and Microsoft, IonQ, and PsiQuantum are among the others working toward error-corrected machines. Proponents say such systems could eventually simulate molecules and materials beyond the reach of classical computers, a key reason governments and corporations have committed billions of dollars to quantum research.

"When we talk about Starling, we're talking about a machine that's at the scale of 200 qubits and 100 billion operations," said Jerry Chow, IBM's head of quantum-centric supercomputing.

The architecture is designed to enable data transfer between processors, supporting more advanced computational tasks. IBM said each module is more than 8 feet tall and more than 8 feet wide and is currently operating at a facility in upstate New York.

According to the company, preliminary testing showed the modules reaching 4 Kelvin in less than five days before falling below 15 millikelvin. Those extremely low temperatures, which approach absolute zero and are far colder than deep space at roughly 2.7 Kelvin, are necessary for quantum chip operation.

The announcement comes after IBM published three technical papers with research collaborators describing methods for real-time verification of quantum calculation accuracy.

Recent weeks have also brought a series of lower price targets from analysts. Argus cut its target from $360 to $280, JPMorgan reduced its target from $291 to $250, and Jefferies lowered its outlook from $320 to $260. Susquehanna initiated coverage with a $225 target and a neutral rating.

Among 27 analysts covering IBM, 15 rate the stock a buy, 11 rate it a hold, and one rates it a sell. The consensus price target is $265.40. Over the past year, IBM shares have traded between $199.19 and $332.46, while the 50-day moving average stands at $249.44.

Institutional ownership remains high at 58.96%. During the second quarter, Merit Financial Group increased its IBM stake by 6.6% to 55,171 shares worth about $15.5 million. Other firms that opened new positions in recent quarters include Basepoint Wealth, Portus Wealth Advisors, and Joseph Group Capital Management.

IBM reported second-quarter earnings of $2.93 per share, matching Wall Street expectations. Revenue came in at $17.16 billion, below the $17.46 billion forecast, but still up 1.1% year over year.

Shareholders are set to receive a quarterly dividend of $1.69 per share on September 10, which works out to an annualized yield of 2.9%.

The company is also facing a securities fraud inquiry from law firm Bleichmar Fonti and Auld related to a slowdown in its Z mainframe business. No determination of wrongdoing has been made.

IBM said Starling will serve as a stepping stone toward Blue Jay, a more advanced quantum system the company plans to launch in the early 2030s. Under IBM's published roadmap, Starling is slated to come online in 2029, with Blue Jay to follow in 2033.