Rigetti Computing’s Stock Journey: From Slump to Recovery and Future Prospects

Rigetti Computing (NASDAQ: RGTI) has seen considerable ups and downs over the past three years. The quantum computing firm went public through a merger with a special purpose acquisition company (SPAC) on March 2, 2022. Initially, it began trading at $9.75 but plummeted to a record low of $0.38 per share on May 3, 2023.

However, as of April 2, 2025, Rigetti’s stock is trading at approximately $8.50 per share. An investment of $1,000 when the stock hit its all-time low would now be valued at close to $22,400. Let’s explore the reasons behind Rigetti’s stock decline and subsequent recovery, and assess whether it’s a viable investment option after this significant rebound.

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Understanding Rigetti’s Position in the Quantum Computing Space

Traditional computers process data using binary bits—zeros and ones. Quantum computers, however, utilize “qubits,” allowing them to store values between these two extremes. This property enables quantum systems to manage larger datasets more efficiently.

While the leap from classic binary computing to quantum technology seems substantial, these new machines are still larger, pricier, and more power-intensive than their traditional counterparts. They also experience a higher rate of data errors, necessitating extensive error correction to become truly practical. Consequently, quantum computers are largely confined to specialized research applications at this stage.

To address these shortcomings, companies like Rigetti Computing are focused on developing quantum systems that are faster, more affordable, smaller, and more precise. Rigetti is involved in designing and manufacturing its quantum processing units (QPUs), constructing comprehensive quantum systems, and hosting a cloud platform geared toward quantum application development. This broad array of offerings positions Rigetti as a “full stack” player in the emerging quantum computing market.

Factors Behind Rigetti’s Stock Volatility

Prior to its public listing, Rigetti predicted revenues of $18 million for 2022, $34 million for 2023, and $73 million for 2024. It also projected its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) would reduce from a $39 million loss in 2022 to a $12 million loss by 2024.

In reality, however, Rigetti generated only $11 million in revenue for 2024, alongside a negative adjusted EBITDA of $49 million. According to generally accepted accounting principles (GAAP), the company posted a staggering net loss of $201 million. The combination of disappointing financial performance, rising interest rates, and the departure of founder Dr. Chad Rigetti from the CEO role in late 2022 contributed to the drop in stock prices, culminating in May 2023’s record low.

Near-Term Strategies for Rigetti

Despite these hurdles, Rigetti’s stock rebounded during the latter half of 2024, largely due to product launches and a decrease in interest rates. Dr. Rigetti remained to focus on product development after transitioning the CEO role to Dr. Subodh Kulkarni, a former leader at the 3D sensing technology company CyberOptics.

Rigetti introduced its Novera QPU, a 9-qubit commercial quantum computer priced at $900,000, in December. Additionally, the company released its first 84-qubit Ankaa-3 system, capable of correcting over 99% of errors for its cloud services. High-profile clients now include the Superconducting Quantum Materials and Systems Center, the Air Force Research Lab, and Horizon Quantum Computing in Singapore.

This year, Rigetti plans to introduce a modular quantum system that combines four 9-qubit chips to form a 36-qubit system, maintaining a median gate fidelity of 99.5%. In 2026, it aims to roll out a non-modular 100-qubit system with a similar fidelity. Looking ahead, the company plans to develop a more advanced 336-qubit system in the coming years.

Assessing Growth Potential in Rigetti’s Stock

If Rigetti accomplishes its ambitious growth plans, analysts anticipate revenue increases of 27% to $14 million in 2025, 140% to $34 million in 2026, and a further 48% to $50 million in 2027. Currently, with a market capitalization of $2.23 billion, Rigetti is trading at 45 times its projected sales for 2027. In contrast, industry peer IonQ (NYSE: IONQ), expected to experience higher growth, is trading at only 19 times its estimated sales for the same year.

These metrics indicate that Rigetti’s stock is priced for exceptional performance, which may be challenging to achieve amid a volatile economic environment. Additionally, competition is intensifying from tech giants like Microsoft, Alphabet’s Google, and IBM, all of whom are advancing their own quantum computing developments.

Moreover, Rigetti has expanded its number of outstanding shares by 151% since its public debut due to secondary offerings and stock-based compensation. Such dilution is likely to persist as the company seeks to raise capital to offset its significant losses. Insider selling has also been notable, with insiders offloading nearly four times more shares than they purchased in the past year.

Considering these factors, it may be wise to avoid Rigetti’s stock. At this pricing level, the stock resembles a speculative investment, with potential for substantial declines still leaving it seemingly overvalued.

Conclusion: Should You Invest in Rigetti Computing?

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, International Business Machines, and Microsoft. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.