Despite reporting nearly 199% year-over-year revenue growth in first-quarter 2026, Rigetti Computing’s RGTI shares have plunged roughly 19% since the earnings release as investors appear concerned about the company’s long path toward commercial quantum advantage. While Rigetti Computing highlighted the general availability of its 108-qubit Cepheus-1 system across major cloud platforms, including Amazon Braket and Microsoft Azure Quantum, management acknowledged that meaningful commercial adoption remains in the early stages. The company noted that most current workloads are still limited to research and experimentation rather than real-world enterprise deployment, suggesting that large-scale monetization opportunities may still be years away.
Investor sentiment also seems pressured by the company’s continued heavy spending requirements and long development timeline. Rigetti Computing reiterated that quantum advantage is likely still around three years away, targeting a roughly 1,000-qubit system with 99.9% two-qubit gate fidelity and some level of error mitigation. Meanwhile, operating expenses climbed 24% year over year in the quarter, due to elevated R&D investments, fabrication spending and infrastructure expansion.
Management also expects capital expenditures to remain high throughout 2026 as it scales dilution refrigeration capacity and supports higher-qubit systems. While Rigetti Computing exited the quarter with a strong cash balance of nearly $569 million and no debt, the market appears cautious about the long road to profitability and the execution risks tied to scaling quantum computing systems commercially.
Peers Updates
D-Wave Quantum QBTS continues to expand its commercial quantum computing footprint despite mixed first-quarter 2026 results. Revenues declined sharply year over year due to the absence of a large prior-year system sale. However, bookings surged significantly, supported by a major system purchase from Florida Atlantic University and a multiyear enterprise agreement with a Fortune 100 customer. D-Wave also broadened its technology portfolio through the acquisition of Quantum Circuits, strengthening its capabilities in gate-model quantum computing alongside its core annealing platform.
IonQ IONQ exited first-quarter 2026 with strong momentum, driven by robust system sales, growing cloud usage and contributions from recent acquisitions. The company reported sharp revenue growth and continued expansion in backlog and remaining performance obligations, reflecting rising enterprise and government demand. IonQ also secured its first 256-qubit system sale and remains on track to showcase its next-generation 256-qubit quantum computer later this year, reinforcing its strong positioning in the rapidly evolving quantum computing market.
Rigetti Computing’s Price Performance, Valuation and Estimates
Shares of RGTI have plunged 25% in the year-to-date period compared with the industry’s decline of 13.7%.
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From a valuation standpoint, Rigetti Computing trades at a price-to-book ratio of 9.46, above the industry average. RGTI carries a Value Score of F.
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The Zacks Consensus Estimate for Rigetti Computing’s 2026 earnings implies a significant 70.3% improvement from the year-ago period.
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The company currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).