TLDR:
- Rigetti reported Q1 profit of 13 cents per share due to noncash accounting gains while revenue fell 51% to $1.5 million, missing analyst expectations
- The company was selected for DARPA’s Quantum Benchmarking Initiative and secured a $35 million investment from Quanta Computer
- CEO Subodh Kulkarni stated quantum computing remains in R&D mode, 4-5 years away from “quantum advantage”
- Operating expenses increased to $22.1 million in Q1 2025 from $18.1 million in the prior year
- The National Quantum Initiative Reauthorization Act, if passed, would provide crucial funding for quantum computing companies
Rigetti Computing reported first-quarter earnings that beat profit expectations but missed on revenue as the quantum computing sector continues its volatile path toward commercial viability. The company posted a 13-cent profit on an adjusted basis, compared to a 14-cent loss a year earlier, but revenue fell 51% to $1.5 million, well below the $2.6 million analysts expected.
The profit was largely due to $62.1 million in noncash gains from changes in fair value of derivative warrant and earn-out liabilities – essentially an accounting gain from revaluing stock warrants the company has issued.
Rigetti stock fell nearly 12% to $10.17 in early trading Tuesday. The stock had already retreated nearly 23% in 2025 heading into the earnings report.
CEO Subodh Kulkarni addressed the revenue miss during the earnings call, noting that “quantum computing continues to be in R&D mode.”
“Our view is that we are still very much in the stage of developing quantum computers,” Kulkarni explained. “We are still four to five years away from what we call quantum advantage.”
Strategic Partnerships Boost Future Outlook
Despite revenue challenges, Rigetti has made notable progress in securing strategic partnerships. In February, Taiwan-based Quanta Computer agreed to invest $35 million in Rigetti through a stock purchase.
This investment is part of a larger $250 million commitment over five years to develop non-QPU (quantum processing unit) hardware. The partnership allows Rigetti to focus on QPU development while leveraging Quanta’s expertise in high-volume manufacturing.
Rigetti was also among 18 companies recently chosen by the Defense Advanced Research Projects Agency (DARPA) to participate in the Quantum Benchmarking Initiative. This program aims to assess the feasibility of developing industrially useful quantum computers.
The company received an Air Force Office of Scientific Research award to further develop their chip fabrication technology. They also won three Innovate UK Quantum Miss Pilot Awards to advance superconducting quantum computing.
Another technical achievement includes the successful demonstration of optical control of a superconducting qubit, which could help in scaling quantum systems.
Financial Performance Remains Mixed
Rigetti’s financial results revealed some concerning trends beyond the revenue miss. Gross margins dropped to 30% in Q1 2025 from 49% in Q1 2024, partly due to lower margin contracts.
Operating expenses increased to $22.1 million in Q1 2025 from $18.1 million the prior year, driven by salary increases and stock compensation expenses.
The company reported an operating loss of $21.6 million for Q1 2025, up from $16.6 million in the previous year.
During the earnings call, Rigetti executives expressed confidence in their technology roadmap. They plan to achieve 49 qubit chiplets by mid-year and over 100 qubits by year-end.
Kulkarni emphasized that previous attempts with two chiplets have been successful, and they believe this approach is essential for scaling superconducting qubits effectively.
The CEO also highlighted the importance of the National Quantum Initiative Reauthorization Act, which has bipartisan support but hasn’t passed yet. The original act, passed in 2018 during President Trump’s first administration, lapsed in September 2023.
“If Congress passes the National Quantum Initiative Reauthorization Act, it would provide a funding boost for quantum computing companies as well as potential customers,” Kulkarni said.
Current sales are primarily from government contracts and academic researchers, which Kulkarni described as “one-off” and “lumpy in nature.” The company anticipates commercial sales to become more important in 3-5 years when quantum advantage is achieved.
Rigetti’s performance contrasts with other quantum computing companies. IonQ recently reported an in-line loss and flat revenue, while D-Wave Quantum reported a smaller-than-expected loss with revenue rising 509% to $15 million.
Quantum computing stocks have been volatile in 2025, with debates about how soon commercially viable quantum technology will be available. The sector aims to solve problems too complex for today’s classical computers using exotic technologies like supercold superconductor chips.
Rigetti continues to focus on its technology roadmap, believing that its chiplet approach will allow it to scale up its quantum computing capabilities effectively throughout 2025.
