D-Wave Quantum Inc. (NYSE:QBTS) shares are charging higher on Wednesday. This surge follows a massive sector-wide rally triggered by NVIDIA Corp. (NASDAQ:NVDA).

On Tuesday, Nvidia launched Ising, the world's first open-source quantum AI model family.

NVIDIA's Ising Ignites Quantum Sector

The new models aim to solve critical engineering hurdles in processor calibration.

NVIDIA claims Ising delivers performance up to 2.5 times faster than traditional methods. "AI is essential to making quantum computing practical," stated Nvidia CEO Jensen Huang. He noted that Ising allows AI to become the "operating system of quantum machines."

Sector-Wide Momentum Lifts QBTS

The news sparked broad gains across the industry. IonQ (NYSE:IONQ) and Rigetti Computing (NASDAQ:RGTI) also posted double-digit increases.

QBTS rose over 15.84% during Tuesday's session and continued its climb in Wednesday's premarket. Investors are betting on Quantum's future as the market is expected to surpass $11 billion by 2030.

Short Interest Dynamics

Short sellers may be feeling the squeeze. Recent data shows short interest in QBTS increased from 54.36 million to 58.77 million shares. This represents 16.41% of the company's public float. Based on average daily volume, it would take 2.78 days for shorts to cover their positions.

CEO Baratz Challenges Nvidia

D-Wave CEO Alan Baratz recently turned up the heat on the GPU giant. "If I was Nvidia, I'd be shaking in my boots," Baratz told Yahoo Finance. He argues that quantum computing will eventually challenge GPU dominance in AI. He added, "We're not waiting for the future—we're building it."

QBTS Price Action: D-Wave Quantum shares were up 10.67% at $18.78 during premarket trading on Wednesday, according to Benzinga Pro data.

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