Rigetti delayed its 108-qubit system after identifying coupler interactions at larger scales, but now expects deployment by the end of March.
- Rigetti reported Q4 revenue of $1.9M, missing the $2.33M consensus and down from $2.3M a year earlier.
- Gross margin fell to 35% from 44%, and operating expenses rose to $23.2 million due to increased R&D spending.
- Non-GAAP net loss improved slightly to $11.3 million from a loss of $14 million last year.
Shares of Rigetti Computing, Inc. (RGTI) slipped after-hours on Wednesday after the quantum firm reported a revenue miss and wider loss, even as CEO Subodh Kulkarni said its chiplet architecture could “outshine” rivals.
RGTI stock jumped nearly 5% in Wednesday’s regular session.
RGTI Q4 Earnings Review
The company posted fourth-quarter (Q4) revenue of $1.9 million, down from $2.3 million a year earlier and below the $2.33 million consensus estimate. CFO Jeffrey Bertelsen said the decline was driven by the timing of system deliveries and government contracts.
Rigetti reported an operating loss of $22.6 million, wider than $18.5 million a year earlier. On a non-GAAP basis, the company posted a net loss of $11.3 million, or $0.03 per share, compared with a $14 million loss, or $0.06 per share, in the same period last year.
Gross margin fell to 35% from 44% in the prior-year quarter, which Bertelsen attributed primarily to contract mix, noting that government and national laboratory projects tend to carry lower margin profiles.
Operating expenses rose to $23.2 million from $19.5 million, driven largely by research and development spending, including engineering headcount, fabrication and system integration work.
The company ended the year with about $589.8 million in cash, cash equivalents and investments, with no debt.
CEO Touts Chiplets As Quantum Edge
Kulkarni called Rigetti’s chiplet architecture its core differentiator, saying that large-scale quantum systems will rely on modular designs rather than single monolithic chips. “Scaling to thousands of qubits on a single die is not realistic,” he said. “Chiplets are how we believe quantum systems will scale in the real world.”
He added that the company’s chiplet strategy helps it stand out in the quantum computing race. “The other part where we really outshine our competitors is chiplet,” Kulkarni said, adding that customers view chiplet systems as a practical way to scale quantum hardware over time.
Kulkarni also noted that some competitors have yet to reach comparable scale, and certain trapped-ion or atom-based systems have not approached the 100-qubit range.
Rigetti Fixes 108-Qubit Issues
Rigetti also identified technical challenges while scaling its 108-qubit system, including tunable coupler interactions at higher qubit counts, prompting the company to delay deployment and implement architectural refinements. “We made a deliberate decision to delay general availability and address the issue,” Kulkarni said.
Rigetti now expects to deploy the 108-qubit system around the end of March, with a median two-qubit fidelity of about 99.5%, followed by a system with more than 150 qubits targeted for late 2026.
How Did Stocktwits Users React?
On Stocktwits, retail sentiment for RGTI was ‘extremely bearish’ amid a 447% surge in 24-message volume.
One user called the earnings “disappointing” and said, “But if history repeats, we can see a violent 10% to 20% rip tomorrow or Friday?”
Another user said, “I'm amazed this isn't down more. It's March and they still haven't reached their 2025 fidelity goal. At this rate, there's a good chance they deliver a system with only 99% fidelity.”
RGTI stock has declined 20% year-to-date.
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