Core Insights - The National Quantum Initiative (NQI) has seen a significant increase in federal investment, with approximately $1 billion allocated annually for quantum information science in FY 2025, up from about $456 million in 2019 [1][3] - The upcoming reauthorization of the NQI for 2025-2029 is expected to further enhance funding, with proposals of $1.8 billion from the House and $2.7 billion from the Senate, focusing on applied projects and public-private partnerships [3][9] - Companies like IonQ, Rigetti, and D-Wave are benefiting from government contracts, which are crucial for their growth narratives despite their current low revenues and operating losses [4][6] Federal Investment and Support - Federal agencies are collectively investing around $1 billion annually in quantum information science, indicating a strategic focus on this technology [1] - The NQI reauthorization plans aim to scale funding significantly, with the House proposing $1.8 billion and the Senate proposing $2.7 billion over five years [3] - DARPA's selection of quantum firms for contracts signals government confidence in their technologies, which can represent a substantial portion of these companies' revenues [4][5] Market Dynamics and Valuations - Despite being in early stages with low revenues, quantum companies have seen their valuations rise, largely driven by expectations of government spending rather than immediate commercial demand [6][9] - Defense contracts, even in the range of $5-10 million, can significantly impact stock prices, highlighting the importance of government as a primary customer for quantum technologies [7][9] Investment Strategy and Future Outlook - Investors should focus on policy and procurement as key factors in valuing quantum companies, rather than traditional product cycles [13][16] - The recent example of xLight illustrates the potential for government equity-like investments in critical technology sectors, which could extend to quantum firms [11][17] - The trajectory of quantum stocks will be influenced more by government funding and support than by the timing of technology mainstreaming [18][19]

We recently published 10 Stocks Already Hurting in December. Rigetti Computing, Inc. (NASDAQ:RGTI) is one of the top performers on Monday. Rigetti Computing dropped its share prices by 8.27 percent on Monday to close at $23.45 apiece, mimicking an overall market pessimism following the recent holiday rush. Additionally, investors unloaded portfolios amid the company’s lack of positive developments to bolster buying appetite. Early last month, Rigetti Computing, Inc. (NASDAQ:RGTI) announced its earnings ...

Core Insights - The article discusses the potential of quantum computing as the next major investment opportunity, likening it to Nvidia's success in the GPU market [1][2] - It highlights three publicly traded quantum companies that are leading the charge in this emerging field: IonQ, Rigetti Computing, and D-Wave Quantum [1][2] Company Summaries IonQ - IonQ is recognized as a leading candidate in the quantum race, achieving a world-record 99.99% 2-qubit gate fidelity, which is crucial for efficient error correction [3] - The company reported third-quarter 2025 revenue of $39.9 million, marking a 222% year-over-year growth, with full-year guidance of $106 million to $110 million [5] - IonQ has a strong cash position of $3.5 billion, enabling strategic acquisitions and talent acquisition, with recent purchases including Vector Atomic and Oxford Ionics [5] Rigetti Computing - Rigetti employs a modular, multichip architecture using superconducting qubits, which is compared to AMD's strategy in the semiconductor industry [6] - The company's Ankaa-3 system has a median 2-qubit gate fidelity of 99.5%, with a focus on speed as superconducting qubits operate in nanoseconds [8] - Rigetti has commercialized its technology through sales to various sectors and has approximately $600 million in cash and investments, supporting its roadmap for larger quantum systems [9] D-Wave Quantum - D-Wave is often misunderstood as merely an annealer but is generating revenue through its specialized quantum computing for optimization problems [10] - The Advantage2 system features over 4,400 annealing qubits and has secured 133 customers, including major corporations [11] - D-Wave is also developing a universal gate-model computer and has a cash position of around $836 million, reducing liquidity risk [12] Investment Perspective - The article suggests that no single qubit architecture is guaranteed to dominate, with trapped ions offering fidelity, superconducting systems providing speed, and annealing systems delivering utility [13] - Investors are encouraged to consider a diversified approach by investing in all three companies to capitalize on the quantum computing trend [13] - The potential market for quantum computing is projected to reach between $45 billion and $131 billion by 2040, indicating significant upside potential despite current unprofitability and high expectations [14]

The quantum computing company's valuation looks excessive when compared to the entire industry.The quantum computing industry is in its early growth days. It'll likely be many years before quantum computers are common. While many tech experts believe there is a lot of potential for them to improve efficiency and productivity, the big question always leads back to when that will actually happen. And that's the biggest unknown at this stage.That also means that for the foreseeable future, companies such as Ri ...

Core Viewpoint - Quantum computing stocks such as Rigetti, IonQ, and D-Wave are facing potential valuation corrections as the technology is still in its infancy and may not be widely useful for at least a decade [3][15][16] Industry Overview - Quantum computing is expected to revolutionize various sectors, including drug discovery, materials science, finance, cybersecurity, supply chain management, and artificial intelligence [7] - Current quantum computing revenue is projected to reach $4 billion by 2030, while AI revenue is forecasted to hit $390 billion by 2025, indicating a significant disparity in market investment [11] Company Valuations - Rigetti, IonQ, and D-Wave are trading at extremely high valuations, with IonQ at 145 times sales, D-Wave at 270 times, and Rigetti at 980 times, compared to Nvidia's 3 times sales in 2015 [13] - Over the past three years, D-Wave increased its share count by 209%, Rigetti by 164%, and IonQ by 77%, leading to significant shareholder dilution [14] Expert Opinions - Industry experts, including Nvidia's CEO and Alphabet's CEO, suggest that practical quantum computers are still 5 to 20 years away, indicating that current market enthusiasm may be premature [12] - The expectation is that the quantum computing bubble may burst as early as 2026 due to the combination of high valuations and the long timeline for technological breakthroughs [15][16]

Core Insights - Quantum computing is gaining significant attention due to its potential to solve complex problems that classical systems cannot handle, presenting a unique investment opportunity in a future trillion-dollar industry [1] Company Approaches - Rigetti Computing (RGTI) is advancing a gate-based superconducting architecture aimed at universality and scalability, recently launching a 36-qubit system with a median two-qubit gate fidelity of approximately 99.5% [5][12] - D-Wave Quantum (QBTS) focuses on quantum annealing and hybrid solvers for immediate deployment in optimization problems, providing a near-term value proposition for industries [6][13] Price Performance - RGTI shares have increased by 67.5% year-to-date, while QBTS stock has surged by 166.7% in the same period [3] Business Models - RGTI's revenue is primarily derived from government contracts and research collaborations, leading to unpredictable revenue flows [8] - QBTS is pursuing a diversified revenue model that includes hardware sales and enterprise engagements, indicating a shift towards a more stable revenue base [9] Recent Financials - RGTI reported revenues of approximately $1.9 million, down from $2.4 million year-over-year, with elevated operating expenses of around $21 million [10] - QBTS experienced a strong quarterly performance with revenues doubling to $3.7 million and a significant increase in cash reserves to $836.2 million [11] Future Projections - The Zacks Consensus Estimate for RGTI's 2025 sales indicates a year-over-year decline of 23.82%, with a projected loss per share of 68 cents [15] - In contrast, QBTS's 2025 sales are expected to grow by 188.6%, with a projected loss per share of 23 cents [18] Investment Considerations - RGTI is positioned for long-term scalability with its gate-based systems, while QBTS offers immediate commercial activity and momentum [23] - The choice between RGTI and QBTS depends on investor preference for near-term traction versus long-term potential in quantum computing [14][23]

Core Insights - The article discusses the potential bubble in quantum computing stocks, highlighting that while the technology is promising, it is still years away from significant practical applications [1][10][17] Industry Overview - Quantum computing is expected to create substantial economic value, estimated between $450 billion to $850 billion by 2040, indicating a wide range of potential beneficiaries [3] - The early-stage commercialization of quantum computing has generated investor excitement, with major companies like Amazon and Microsoft providing access to quantum computing services [5][12] Company Performance - Quantum computing stocks such as IonQ, Rigetti Computing, D-Wave Quantum, and Quantum Computing Inc. have seen significant price increases, with some stocks rallying by as much as 829% over the past year [2][6] - Projected sales growth for these companies from 2025 to 2027 includes IonQ increasing from $108 million to $315 million, Rigetti from $8 million to $48 million, D-Wave from $25 million to $74 million, and Quantum Computing Inc. from $1 million to $10 million [7][6] Market Dynamics - The article suggests that the quantum computing bubble may burst in 2026, as historical trends indicate that investor expectations often exceed the actual adoption and utility of new technologies [8][9] - The first-mover advantage of current quantum computing companies is at risk due to competition from major tech firms like Alphabet and Microsoft, which are also investing heavily in quantum technologies [13][14] Valuation Concerns - Current valuations of quantum computing stocks suggest a high probability of a bubble, with price-to-sales ratios for these companies projected to exceed historical peaks associated with previous technology bubbles [16]

Rigetti Computing, Inc. (NASDAQ:RGTI) is one of the Best Quantum Computing Stocks to Invest In Right Now. On November 12, David Williams, a Benchmark analyst, assigned a “Buy” rating to the company’s stock, with a price objective of $40. While the analyst remains constructive on progress, mainly its chiplet-based architecture and roadmap execution, he believes that the recent volatility throughout emerging tech and AI sectors impacted near-term investor enthusiasm for shares in the quantum industry. Bench ...

Core Insights - Quantum computing is transitioning from research to early commercial traction, with IonQ and Rigetti Computing as key players in this shift [1][2] Group 1: IonQ Overview - Technical momentum includes achieving the AQ 64 performance milestone on Tempo ahead of schedule and a world-record 99.99% two-qubit gate fidelity, indicating a focus on qubit quality and algorithmic usefulness [3] - Commercial progress is highlighted by Q3 2025 revenues of $39.9 million, a 222% year-over-year increase, attributed to growth in computing and networking, sensing, and cybersecurity products [4] - The balance sheet is strengthened by a $2.0 billion equity offering, resulting in a pro-forma cash position of approximately $3.5 billion with no debt, supporting an aggressive multiyear product roadmap [5][16] Group 2: Rigetti Overview - Rigetti's roadmap includes plans for a 100+ qubit chiplet-based system with 99.5% median two-qubit gate fidelity by end-2025, aiming for a 1,000+ qubit system by end-2027 [8] - Early commercial traction includes securing two purchase orders totaling $5.7 million for its 9-qubit Novera systems and a $5.8 million contract with the Air Force Research Laboratory, indicating growing interest in quantum hardware [9] - Despite revenue softness, Rigetti's stock performance surged 69.4% over three months, outperforming IonQ and the S&P 500 [10][17] Group 3: Financial Estimates - Earnings estimates for IonQ have declined significantly, with a projected loss of $5.14 per share for 2025, reflecting a 229.5% decline from the previous year [11] - Rigetti's earnings estimates also fell, with a projected loss of $0.68 per share for 2025, indicating an 88.9% decline from the prior year [15] Group 4: Comparative Analysis - IonQ is positioned with stronger revenue momentum and a fortified balance sheet, while Rigetti shows operational leverage and favorable earnings revisions [16][17] - IonQ is likely to maintain a comparative advantage in financial strength and commercial visibility, whereas Rigetti may offer higher-beta upside if it meets technical milestones [18]

Core Insights - Rigetti Computing (RGTI) is focusing on government partnerships as a key strategy for commercialization, with recent revenue declines attributed to the expiration of the U.S. National Quantum Initiative (NQI) [1][8] - The reinstatement of the NQI program with a budget of $625 million over five years is expected to enhance demand from national labs and government agencies [2] - Rigetti has secured significant government contracts, including a $5.8 million deal with the Air Force Research Laboratory, which is anticipated to contribute to revenue in the upcoming quarters [3][4] Revenue and Financial Performance - In the third quarter, Rigetti reported revenue of $1.9 million, down from $2.4 million year-over-year, primarily due to the lapse of NQI funding [1][8] - The reinstated NQI funding is expected to provide a demand boost as federal purchasing cycles resume [2] - Rigetti's shares have increased by 74.1% year-to-date, contrasting with a slight decline in the industry [7] Government Contracts and Pipeline - Rigetti's recent contract wins, including a three-year contract with the Air Force, indicate a strengthening government pipeline and a shift towards hardware deployment [3][4] - The company has significant cash reserves and no debt, allowing it to scale operations and deepen federal partnerships as NQI funding resumes [4] Valuation and Earnings Estimates - Rigetti's price-to-book ratio stands at 22.2, which is above the industry average, and it carries a Value Score of F [10] - The Zacks Consensus Estimate for Rigetti's 2025 earnings suggests an 88.9% decline compared to the previous year [11]