Investors in quantum computing pioneer Rigetti Computing are facing substantial losses following a severe market downturn. The company’s shares have collapsed by more than 40% over just ten trading sessions, with Thursday alone bringing an additional 11% decline. This marks the sixth consecutive day of losses for the quantum technology firm, leaving market participants searching for explanations behind the dramatic sell-off.
Financial Performance Misses Expectations
The sharp decline stems from Rigetti’s third-quarter results for fiscal year 2025. While the company reported an adjusted loss per share of $0.03, slightly better than anticipated, the revenue figures delivered an unpleasant surprise. Rigetti generated only $1.9 million in revenue, falling significantly short of the $2.17 million analysts had projected. The situation appears even more concerning when compared to the same quarter last year, when the company posted $2.4 million in revenue.
Operational Challenges Intensify
A deeper examination of the financial statements reveals more fundamental problems. The company’s gross margin experienced a dramatic contraction, collapsing to 21% from 51% during the same period last year. This margin erosion points to significant operational efficiency challenges.
Meanwhile, operating losses expanded to $20.5 million, compared to $17.3 million in the prior-year quarter. Rigetti reported a GAAP net loss of $201 million, though this figure primarily resulted from accounting adjustments related to stock-based compensation. The adjusted net loss stood at $10.7 million.
Should investors sell immediately? Or is it worth buying Rigetti?
The combination of declining revenue and mounting losses has raised serious questions about the company’s operational viability without additional capital infusion or substantial new revenue streams.
Future Promises Clash with Present Realities
Despite the current challenges, Rigetti maintains its ambitious technology roadmap. The company continues to target delivering a system with over 100 qubits by the end of 2025, followed by a 1,000-plus qubit system by the end of 2027. Additionally, management announced new orders totaling $5.7 million and a $5.8 million contract with the Air Force Research Laboratory.
However, investors appear more focused on immediate financial pressures than distant technological milestones. Technical indicators reinforce the negative sentiment, with both short-term and long-term moving averages signaling strong sell conditions. With the stock in freefall and no clear bottom in sight, market confidence remains severely tested.
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