Rigetti Computing Seeks to Establish Quantum Computing Leadership with Ambitious Plans

Rigetti Computing Inc. (RGTI) has recently reported its fourth-quarter results, falling short of revenue expectations, yet it has boldly proclaimed its intent to compete with industry giants such as International Business Machines (IBM) and Alphabet Inc.'s (Google) in the rapidly evolving field of quantum computing.

What Happened: The advocacy for innovation was voiced by Rigetti’s president and CEO, Subodh Kulkarni, during an earnings call. He expressed confidence in Rigetti's position, stating that the company is at the forefront of the quantum computing race, alongside IBM and Google.

Kulkarni highlighted that Rigetti’s roadmap closely parallels those of its competitors, claiming, “we certainly view ourselves along with IBM and Google in the leadership position.” With the recent launch of their 84-qubit Ankaa-3 system in December 2024, Rigetti is aiming to scale its technology to 100 or more qubits by the end of 2025.

In contrast, IBM had previously introduced a quantum processor exceeding 400 qubits in 2022, though it has yet to be deployed due to various challenges, as mentioned by Kulkarni. He stated, “IBM tried to go to 430 qubits a year ago and they had some challenges, which is why you don’t find it deployed right now.” Meanwhile, Google last unveiled its Willow chip, which operates with 105 qubits.

Why It Matters: Despite the advances made by IBM and Google in terms of qubit counts, Rigetti remains optimistic. Kulkarni emphasized their unique advantages over competitors, stating, “the main differentiators are our open modular architecture, chiplet approach, and a few other things like annealing.” He indicated that ongoing U.S. government investments in quantum computing research and development will further bolster their competitive stance, especially through anticipated support from the Department of Energy and the Department of Defense.

In terms of financial performance, Rigetti reported fourth-quarter revenues of $2.3 million, which did not meet expectations, alongside an adjusted earnings per share (EPS) loss of $0.08, aligning with forecasts. For the full year, the company’s revenues reached $10.8 million, while its net loss amounted to $201 million, ending the year with $217.2 million in cash reserves.

Additionally, Rigetti has formed a partnership with Quanta Computer, which includes a $35 million investment from Quanta, contributing to a mutual commitment of over $100 million toward collaboration over the next five years.

Price Action: Following the earnings report, Rigetti's stock rose by 4.07% during trading on Wednesday but dipped by 11% in after-hours trading. In comparison, the exchange-traded fund tracking the Nasdaq Composite index, Fidelity NASDAQ Composite Index ETF ONEQ, saw an increase of 1.43%. While Rigetti’s stock is down 59.10% year-to-date, it has experienced a substantial increase of 359.55% over the past year.

Market analysts are monitoring Rigetti closely, with eight analysts currently tracking the stock and suggesting an average price target of $8.43, indicating a “buy” position. Price estimates for the stock vary widely, ranging from $1.5 to $15, with recent evaluations from Benchmark and B. Riley Securities averaging around $12.5, which indicates potential growth of approximately 71.70%.

Rigetti, Quantum, Computing