Rigetti plunges on sluggish revenue growth, CEO says meaningful commercial sales remain years away

Rigetti Computing (NASDAQ:RGTI) shares plunged 10% by late morning trading on Tuesday, following its first quarter financial results, which reported revenue well below market expectations.

Revenue came in at $1.47M, compared to the analysts’ expectation of $2.56M.

The first quarter results marked the fourth consecutive quarter that Rigetti reported declining revenue growth rates, according to Seeking Alpha analyst Michael Wiggins De Oliveira, who leads the investing group Deep Value Returns.

“Put more starkly, while RGTI’s revenues were down by 52% y/y, its share count was up close to 100% y/y,” he said in an analysis posted today. “In my view, this isn’t a viable business model. Next, consider this, to deliver just over $1M in revenues, the business used up $16M of free cash flow. Accordingly, I struggle to see how this business offers investors an enticing risk-reward.”

He rates the stock a Sell.

“Revenues in the first quarter of 2025 were $1.5M compared to $3.1M in the first quarter of 2024,” said Rigetti Chief Financial Officer Jeff Bertelsen, during the company’s earnings call. “Renewal of the US National Quantum Initiative, sales to U.S. and foreign governments and Novera are all important to future sales.”

Rigetti CEO Subodh Kulkarni said quantum computing remains in the research and development mode for now.

“Our view is that, we are still very much in the stage of developing quantum computers,” Kulkarni said. “We are still four to five years away from what we call quantum advantage, which is when you need at least 1,000 qubits, at least 99.8% fidelity median 2-qubit fidelity median and some real-time error correction. Until then, it’s going to be primarily R&D, primarily driven by government contracts, academic researchers. So there, by definition, those kinds of sales are one-off sales, they are lumpy in nature. So I wouldn’t really interpret sales from any quantum computing company honestly right now in a serious way.”

He said meaningful quantum computing commercial sales are likely three to five years away.

Other quantum computing stocks slipped during Tuesday trading. D-Wave Computing (NYSE:QBTS) was down 2.3%, while Quantum Computing (NASDAQ:QUBT) slipped 2.6%. However, IonQ (NYSE:IONQ) inched up 0.1%.