Rigetti Computing’s (RGTI Quick QuoteRGTI - Free Report) shares have remained under significant pressure, as investors weigh the company’s technological progress against its widening losses and uncertain commercialization timeline. Despite achieving a key performance milestone in its superconducting quantum computing technology, Rigetti continues to face challenges in converting research and development investments into meaningful commercial growth.

Over the past three months, shares of RGTI, D-Wave Quantum (QBTS Quick QuoteQBTS - Free Report) and IonQ (IONQ Quick QuoteIONQ - Free Report) plunged 40.3%, 49% and 24.3%, respectively. The broader Internet Software industry and the S&P 500 Composite also declined, but by a much smaller 3.1% and 4.3%, respectively. The steep decline highlights continued investor caution toward quantum computing stocks, as the industry remains largely in the research and development stage with commercial adoption still some distance away.

Rigetti's third-quarter 2026 results reflected this challenging backdrop. Revenues declined year over year as system deliveries and customer acceptance milestones affected quarterly performance, while operating losses widened amid higher research and development investments.

However, the company achieved 99.5% median two-qubit gate fidelity on its 108-qubit Cepheus-1 system and secured a definitive agreement for up to $100 million in U.S. Department of Commerce funding. With a stronger technology roadmap but rising operating expenses, can Rigetti's technological progress and funding support outweigh its near-term financial challenges?

RGTI's Price Performance

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What's Favoring Rigetti's Investment Story?

Strong Year-to-Date Revenue Growth Supports Commercial Progress

Rigetti's revenue performance over the first nine months of 2026 highlights improving business activity. Revenues increased approximately 110% year over year to $10.9 million from $5.2 million in the comparable period of 2025. Notably, the nine-month revenue figure already exceeded the $7.1 million generated during 2025. Growth reflected contributions from on-premises system sales and continued execution against customer and government programs, indicating progress in monetizing its quantum computing technology.

Management expects 2026 revenues to reach approximately $20 million, representing significant growth from 2025. The outlook assumes customer acceptance of the C-DAC system in the fourth quarter and recognition of the associated revenue during the period. While quarterly revenue remains susceptible to the timing of system deliveries and customer acceptance milestones, the full-year outlook points to improving commercial activity and a potentially stronger revenue base.

High-Speed Processing Could Strengthen Competitive Position

Rigetti's superconducting quantum computing technology offers a potential competitive advantage through faster processing speeds. Management noted that its systems consistently achieve gate speeds of 50-70 nanoseconds, which are approximately 10,000 times faster than trapped-ion systems and 100 times faster than neutral-atom systems. The Cepheus-1-108Q system also operates at approximately 60-nanosecond gate speeds while delivering 99.5% median two-qubit gate fidelity. This combination of speed and fidelity is important as the company works to improve quantum processor performance without compromising system reliability.

The company believes that combining faster gate speeds with higher fidelity and greater qubit counts will be essential to developing commercially relevant quantum systems. Its longer-term roadmap targets approximately 1,000 qubits, 99.9% median two-qubit gate fidelity and gate speeds below 50 nanoseconds within roughly three years, alongside integrated error correction and mitigation. If achieved, these improvements could strengthen Rigetti's ability to support more complex quantum workloads and advance toward demonstrating quantum advantage.

Growing Cloud Adoption Expands Access to Quantum Systems

Rigetti's expanding cloud presence provides another avenue to build customer engagement while the quantum computing market remains in its early stages. Its quantum processing systems are accessible through Rigetti Quantum Cloud Services, Amazon Braket, Microsoft Azure and qBraid, allowing researchers and organizations to access its technology without purchasing and installing on-premises hardware. Management noted that the number of users accessing its 108-qubit system through public cloud platforms continues to increase, while highlighting the system's reliability and consistent performance as important differentiators.

This growing usage could help Rigetti strengthen its position among research institutions, national laboratories, universities and commercial organizations exploring quantum computing applications. Management believes that customer interest is increasing, although widespread commercial adoption remains dependent on demonstrating a return on investment over classical computing. In the meantime, greater cloud accessibility, system reliability and customer support could help the company expand its research user base and build relationships that may support future commercial opportunities.

RGTI’s Sales & EPS Picture

In 2026, Rigetti is expected to experience a 228.6% improvement in revenues. On the profitability front, the company is expected to remain in loss, but estimates reflect loss per share narrowing by 71.9% year over year.

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One Weak Spot for Rigetti

Rising Operating Costs and Uncertain Commercialization

Rigetti's operating expenses continue to rise as the company invests heavily in research and development to advance its quantum computing technology. In the third quarter of 2026, total operating expenses increased to $34 million from approximately $21 million in the prior-year quarter.

Research and development expenses climbed to $25.5 million from $15 million, reflecting higher employee-related costs, stock-based compensation and increased spending on initiatives aimed at achieving quantum advantage and large-scale fault-tolerant quantum computing. Consequently, operating loss widened to $33.2 million from $20.5 million a year ago, while adjusted net loss increased to $20.5 million from $10.7 million.

Revenue visibility also remains a concern, as Rigetti's business continues to depend on a relatively small number of system deliveries, customer acceptance milestones and government-funded development programs. Third-quarter revenues declined to approximately $1.4 million from $1.9 million a year ago, highlighting the uneven nature of quarterly performance.

Management acknowledged that the quantum computing industry remains largely in the research and development phase, with broader commercial adoption dependent on demonstrating a meaningful return on investment over classical computing. The company believes it could be roughly three years before quantum computing reaches a stage where commercial sales begin to accelerate significantly. Until then, elevated R&D spending, uncertain customer adoption and dependence on contract execution could continue to pressure profitability.

RGTI’s Shares Look Overvalued

RGTI stock is currently trading at a Price/Book (P/B) ratio of 6.90 compared with 4.90 for the Internet Software Market. Although Rigetti's valuation has declined considerably from its median P/B ratio of 9.42 over the period, it continues to command a premium over the broader market. The valuation premium reflects investors' expectations for the company's long-term quantum computing potential.

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How to Approach RGTI Stock

Rigetti's investment case is supported by its strong liquidity position, with $497.1 million in cash, cash equivalents and available-for-sale investments and no debt at the end of the third quarter of 2026. The company's up to $100 million U.S. Department of Commerce funding agreement, improving processor performance and expanding cloud presence, also provides potential long-term growth opportunities. However, rising operating expenses, widening losses and the early-stage nature of quantum computing commercialization remain key concerns. Revenue dependence on system deliveries and government-funded programs also adds uncertainty to near-term performance.

With a Zacks Rank #3 (Hold), RGTI appears to offer long-term technological potential, but its elevated valuation and uncertain path to profitability warrant caution.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Investors should closely monitor progress against the company's technology roadmap, customer adoption and revenue growth before taking a more bullish stance on the stock.