Key Takeaways RGTI Q3 revenue declined due to the lapse of NQI funding that slowed federal purchasing.The reinstated $625M NQI program is expected to lift demand as labs and agencies re-engage.A new Air Force contract and Novera system orders support RGTI's strengthening government pipeline.Rigetti Computing (RGTI) is leaning heavily on government partnerships as a core piece of its commercialization path, and the timing could work in its favor. Per the third-quarter earnings call, management was explicit t ...

Core Insights - Rigetti Computing (RGTI) reported a third-quarter 2025 adjusted loss per share of 3 cents, which is an improvement from the 8 cents loss per share in the same quarter last year and exceeded the Zacks Consensus Estimate by 40% [1][7] - The company's total revenues were $1.9 million, reflecting an 18.1% decline year over year and missing the Zacks Consensus Estimate by 18.5% [3][10] - RGTI's gross profit decreased by 66.5% year over year to $0.4 million, with a gross margin contraction of 2990 basis points to 20.7% [5][10] Revenue and Financial Performance - The decline in quarterly revenue was attributed to the expiration of the U.S. National Quantum Initiative (NQI) and reduced government contract activity [4][10] - Selling, general and administrative expenses rose by 2.3% year over year to $5.9 million, while research and development expenses increased by 17.8% to $15 million, leading to total operating expenses of $20.9 million, a 12.9% increase year over year [8][10] - The operating loss for the quarter was $20.5 million, compared to $17.3 million in the prior-year quarter [8] Financial Position - RGTI ended the third quarter of 2025 with cash, cash equivalents, and short-term investments totaling $446.9 million, up from $425.7 million at the end of the second quarter [9] - The company has no debts on its balance sheet, with cumulative net cash used in operating activities at $43.6 million, slightly higher than $42.1 million a year ago [9] Strategic Developments - Rigetti is advancing its chiplet-based roadmap, targeting 1,000 qubits and 99.8% fidelity by 2027, with ongoing interest in its 9-qubit Novera systems [7][11] - The company is collaborating with QphoX and the U.S. Air Force Research Laboratory to enhance microwave-to-optical conversion, a key step for quantum networking [12] - Rigetti has joined NVIDIA's NVQLink initiative, aiming to integrate quantum processing units with AI supercomputing platforms, reinforcing its hybrid computing vision [12][15] Future Outlook - Management has updated its technology roadmap, expressing confidence in scaling superconducting gate-based systems, with plans to deliver a 100-plus qubit chiplet-based system by year-end [13] - By 2026, Rigetti expects to deploy a 150-plus qubit platform, and by 2027, it aims for over 1,000 qubits using larger 36-qubit chiplets [14]

Core Insights - Quantum computing has overtaken artificial intelligence as the most attractive sector in the market, with significant investments in companies like Rigetti Computing, which has seen its stock price surge over the past year [1][4][6] - Rigetti Computing has nearly delivered a 100-bagger return, with an investment of $10,000 now worth approximately $700,000, indicating strong momentum in the quantum computing space [3][5] - The investment trend in quantum computing began in December last year, following Google's announcement of its successful Willow quantum computing chip, which led investors to explore other pure play quantum computing stocks like Rigetti [6][7] Company Performance - Rigetti Computing is a leading player in the quantum computing sector and has recently sold two Novera computing systems, marking a significant step in its business development [4][8] - The sales of the Novera systems, totaling $5.7 million, represent an initial foray into a market that is expected to grow substantially in the coming years [8] - Although the current demand for quantum computing is limited, primarily from research institutions, Rigetti estimates the annual market value to be between $1 billion and $2 billion, with projections of growth to $15 billion to $30 billion between 2030 and 2040 [9]

Core Insights - Rigetti Computing Inc is making significant strides towards its goal of developing a 1,000+ qubit, error-corrected quantum system, having secured $21 million in contracts for 2025 [1][6] - The company emphasizes the importance of its proprietary chiplet architecture and in-house foundry, Fab-1, in achieving high qubit counts and fidelity [5][6] Company Progress - The $21 million contracts are seen as key milestones that demonstrate tangible progress in Rigetti's ambitious four-year revenue roadmap [3][4] - CEO Subodh Kulkarni noted that there is no single factor driving progress, but rather a combination of efforts from a highly skilled team [2][4] Technology and Innovation - Rigetti's chiplet architecture has been validated, and the company is confident that its planned 100+ qubit system for the end of 2025 will maintain high fidelity [5][6] - Fab-1 is positioned to support R&D efforts necessary to meet the expected qubit counts and fidelity [6] Financial Contracts - The contracts include various deals such as two Novera systems totaling approximately $5.7 million, a $5.8 million AFRL contract, and a £3.5 million consortium for deploying a 36-qubit system [8]

Market Overview - Wall Street reached record highs driven by rising expectations for Federal Reserve rate cuts, countering concerns over the U.S. government shutdown [1][2] - Tech and AI-related stocks, particularly Nvidia, contributed significantly to market gains [1] Economic Context - The ongoing government shutdown has delayed key economic data releases, leading investors to focus on sentiment and future rate expectations [2] - Market participants are closely monitoring the duration of the shutdown and its impact on rate cut expectations [3] Bullish Stocks - **Intel Corp.** saw a 50% increase in stock price over the past month, with the U.S. government's stake rising to approximately $16 billion, enhancing investor confidence [4] - **Rumble Inc.** experienced a stock rally following a strategic partnership with Perplexity to integrate AI tools and launch a subscription bundle [5] - **Quantum Stocks**: Rigetti Computing and D-Wave Quantum led a surge in quantum stocks, with Rigetti securing ~$5.7 million in new orders and analysts raising targets for the sector [6] Bearish Stocks - **DraftKings Inc.** stock fell over 10% despite announcing a multi-year advertising partnership with NBCUniversal, as investors weighed competitive pressures in the online gaming market [7] - **Netflix Inc.** shares declined after Elon Musk urged his followers to cancel subscriptions, citing content concerns [8] - **Palantir Technologies and Anduril** faced scrutiny over security vulnerabilities in a U.S. Army communications prototype, labeled as "very high risk" [8]

Core Insights - Rigetti Computing's shares surged 83.6% in September, significantly outperforming other quantum computing stocks [1][9] - The rise in Rigetti's stock was primarily driven by government contracts and quantum orders, with a notable contract from the U.S. Air Force Research Laboratory [3][4] - The company secured two purchase orders for its Novera systems, leading to a substantial increase in market capitalization [5][8] Government Contracts and Orders - Rigetti's stock experienced a 14% increase on September 11, influenced by IonQ's restructuring to meet federal demand [3] - A major catalyst for Rigetti's 48% price surge in the third week of September was a three-year contract with the U.S. Air Force Research Laboratory to explore superconducting quantum networking [4] - The two purchase orders for Novera systems at the end of September resulted in a single-day stock jump of 16.5% [5] Market Capitalization Impact - The two Novera orders increased Rigetti's market cap from $9.66 billion to $11.22 billion, reflecting a $1.56 billion boost from contracts totaling $5.7 million [8]