Rigetti Computing, Inc. RGTI centered its second-quarter earnings call on technical execution, government backing and customer engagement as it advances its superconducting quantum-computing roadmap.
Revenues of $5.1 million topped the Zacks Consensus Estimate of $4.9 million, while non-GAAP loss per share of $0.05 was wider than the $0.03 consensus estimate.
Rigetti Computing, Inc. Price, Consensus and EPS Surprise
Rigetti Computing, Inc. price-consensus-eps-surprise-chart | Rigetti Computing, Inc. Quote
Rigetti Targets Fidelity Gains on Cepheus
Chief executive officer (CEO), president and director Subodh Kulkarni said Cepheus-1-108Q is operating at about 99.1% median two-qubit gate fidelity, with coherence time of roughly 25 to 30 microseconds the main constraint on improvement.
Kulkarni said Rigetti expects fidelity on the 108-qubit system to increase before year-end and is working on chip design, materials and fabrication changes intended to lift coherence time without compromising the cloud system.
An Alliance Global Partners analyst pressed on timing. Kulkarni said a two- to threefold improvement in coherence time is practical in the near term, while reiterating that upgrades will be deployed deliberately.
RGTI Sees Government Funding as Roadmap Support
Kulkarni highlighted the U.S. Department of Commerce letter of intent for up to $100 million over three years as a potential accelerator for research and development tied to scaling superconducting systems.
The proposed structure would give the Department of Commerce an equity stake consistent with the funding amount. Kulkarni emphasized that the LOI is not yet a definitive agreement.
A Needham analyst asked what Rigetti must achieve to unlock the funding. Kulkarni replied that work is expected to focus on cryogenics and miniaturization of readout electronics, with details under discussion.
Rigetti Expands On-Premises and Hybrid Push
The CEO said demand is broadening across government, academic and commercial customers, while on-premises Novera QPU sales drove the year-over-year revenue increase in Q2.
Rigetti is also expanding its collaboration with Hewlett Packard Enterprise and the Pittsburgh Supercomputing Center. Kulkarni said a complete 9-qubit system for the TangleLab hybrid quantum-classical project is expected in 2027.
A TD Cowen analyst asked about the deployment scope. According to Kulkarni, Rigetti will provide the QPU, dilution refrigeration and control system, while HPE will provide the high-performance-computing side.
RGTI Accepts Near-Term Revenue Lumpiness
Chief financial officer (CFO) Jeffrey Bertelsen said the $8.4 million C-DAC order for a 108-qubit system in India remains targeted for fourth-quarter revenue recognition after installation and performance acceptance testing.
Bertelsen said quarterly revenues will continue to vary with large system deliveries and government-funded projects. The CFO added that Rigetti is not managing the business around short-term revenue optimization.
Bertelsen said second-quarter gross margin was about 43%, up from 31% a year earlier, while operating expenses rose to $30.3 million from $20.4 million as spending increased on engineering, fabrication and infrastructure.
Rigetti Q&A Highlights Scaling and Demand
A TD Cowen analyst asked whether Rigetti’s Fremont fab needs capacity expansion. Kulkarni said capacity is not a concern with the current 150-millimeter facility, though the company continues to evaluate capability and automation upgrades.
A StoneX analyst asked how the opportunity pipeline compares with a year ago. The CEO said interest has increased across governments, universities and commercial customers, with commercial demand representing a newer source of activity.
Kulkarni said Rigetti’s first two 9-qubit systems delivered in 2026 went to commercial organizations for research use. He also stated that practical workloads still require progress toward roughly 1,000 physical qubits and higher fidelity.
RGTI Keeps Focus on Quantum Advantage
Kulkarni said the company remains focused on a roughly three-year path toward about 1,000 qubits and 99.9% two-qubit gate fidelity, supported by its chiplet architecture and continued infrastructure investment.
Bertelsen said Rigetti ended Q2 with $541.3 million in cash, cash equivalents and available-for-sale investments and no debt, providing flexibility to fund its technology roadmap and system deployments.
Zacks Signals Remain Cautious
RGTI carries a Zacks Rank #3 (Hold). The Style Score framework places the strongest emphasis on Zacks Rank #1 (Strong Buy) or 2 (Buy) stocks, so a 3 rank does not carry the same favorable near-term signal. You can see the complete list of today’s Zacks #1 Rank stocks here.
Its Value, Growth, Momentum and VGM Score are all F, the weakest grade in the A-to-F hierarchy. The combination lacks the stronger profile associated with top Zacks Ranks paired with an A or B Style Score, and the Zacks Rank can change as estimates are revised after the just-reported results.
Research Chief Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Rigetti Computing, Inc. (RGTI): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).