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Rigetti Computing: Cool Science Project, Terrible Stock
The Setup
Quantum computing is still one of the sexiest stories in tech — the kind of thing that makes VC guys nod gravely while they sip their $7 cold brew. Rigetti Computing (RGTI) has been one of the public market darlings of the space. It just raised $350M, bringing its cash pile north of $570M, announced a $5.8M collaboration with QphoX, and saw its stock rip 30% in a week.
That’s great for sentiment. But here’s the problem: this thing is trading at over 1,000x sales.
That’s not a typo. That’s not “forward” sales. That’s not “if quantum takes over the world next Tuesday” sales. That’s trailing twelve months, $7.9M of actual revenue against a ~$10B market cap.
It’s time to take the punch bowl away.
The Quantum Reality Check
Let’s talk tech first:
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Quantum advantage is still 3–4 years away (1,000+ qubits, 99.9% fidelity, <50ns gate speeds).
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Today’s error rates are roughly one bad op every 1,000 ops. Practical applications need error rates a billion times lower.
Even Rigetti’s own CEO has been saying, in corporate-speak, “please chill — we are still in R&D mode.” Translation: revenue is not coming any time soon.
That’s fine if you’re running a lab. But as a public company trading at nosebleed multiples, it’s a problem.
Follow the Money (And the Dilution)
Rigetti’s big equity raise was smart — when the market is this euphoric, you sell stock and fill the war chest. But let’s be clear:
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Shareholders just got diluted.
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Operating loss last quarter: $19M.
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Cash burn is still very real.
The company is better funded, sure. But better funded to do what? Build more qubits that won’t pay off for another half-decade?
Bubble Behavior 101
This is what a bubble looks like:
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A $5.8M contract (pocket change) sends the stock +30%.
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Retail Twitter is screaming “Next NVIDIA.”
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Cramer just put it on national television with a giant red SELL label.
We’ve seen this movie before — SPACs, EV startups, metaverse coins — and it always ends the same way.
The Competitive Landscape
IBM, Google, and Amazon are all quietly (or not so quietly) building quantum infrastructure with budgets that make Rigetti’s $350M look like couch cushion money.
If quantum becomes commercially viable, the big guys get the first crack at the enterprise deals. Rigetti either finds a niche, gets acquired, or stays in “development mode” until Wall Street gets bored.
Valuation: Let’s Be Honest
Here’s the math:
| Metric | Rigetti (RGTI) | Sanity |
|---|---|---|
| Market Cap | $10B | $10B |
| Revenue (TTM) | $7.9M | $500M+ for a normal growth co. |
| P/S Multiple | 1,067x | 10–20x tops |
| Profitability | Nope | At least approaching break-even |
This is not just expensive — this is speculative mania territory.
Macro Backdrop Matters
Fed liquidity is coming off the boil. Rates are still at risk of staying “higher for longer.” When risk appetite fades, speculative pre-revenue tech is the first thing the market sells. RGTI is basically the poster child for that bucket.
My Verdict
Rigetti is cool. The science is real. The long-term potential is massive.
But right now? This is a $10B science fair project priced like it’s about to print $1B in ARR. Unless you’re a gambler, this is a sell. Lock in the gains, let the true believers HODL through the next drawdown, and revisit when there’s a business worth valuing.
Our Call: HOLD ➝ SELL.
So…
This is exactly the kind of market we love — where narrative runs far ahead of fundamentals. Rigetti will probably be a great company one day. It just doesn’t have to be a great stock today.
DISCLAIMER: This analysis of the aforementioned stock security is in no way to be construed, understood, or seen as formal, professional, or any other form of investment advice. We are simply expressing our opinions regarding a publicly traded entity.
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