Rigetti Computing Inc. ((RGTI)) has held its Q1 earnings call. Read on for the main highlights of the call.
Rigetti Computing’s latest earnings call struck a cautiously optimistic tone, highlighting meaningful technical strides and expanding customer traction against a backdrop of rising costs and volatile GAAP results. Management stressed that strong liquidity, rapid revenue growth and clear engineering roadmaps position the company to pursue quantum advantage despite near‑term operational and profitability pressures.
Launch of Cepheus-1-108Q and Technical Milestones
Rigetti unveiled general availability of its 108‑qubit Cepheus‑1‑108Q system, built from 12 interconnected 9‑qubit chiplets and accessible via Rigetti QCS, AWS Braket, Microsoft Azure Quantum and qBraid. The system delivers about 99.1% median two‑qubit fidelity at roughly 60 ns and 99.9% single‑qubit fidelity, with smaller systems and prototypes showing even higher performance, validating the chiplet scaling strategy.
Material Year-Over-Year Revenue Growth
Revenue for Q1 2026 reached $4.4 million, up from $1.5 million a year earlier, marking about 193% year‑over‑year growth. The increase was driven mainly by on‑premises Novera quantum processing unit deliveries and government and research contracts, underscoring early commercial traction even from a modest base.
Stronger Balance Sheet and Improving Non-GAAP Results
The company ended the quarter with approximately $569 million in cash, cash equivalents and available‑for‑sale investments, up sharply from $209.1 million a year ago and with no debt. Non‑GAAP net loss improved to $14.7 million, or $0.04 per share, compared with $15.3 million and $0.05 per share last year, suggesting underlying operating progress once noncash swings are stripped out.
Customer Traction and Revenue Pipeline Visibility
Rigetti highlighted growing adoption across cloud and on‑premises channels, including a University of Saskatchewan order, multiple Novera QPU sales and several government engagements. Management expects most of the remaining $5.7 million of previously announced Novera purchase orders to be recognized primarily in Q2 2026 and is executing an $8.4 million C‑DAC order scheduled to be recognized in Q4 2026 after installation.
Strategic Partnerships and Global Expansion Plans
The company broadened its ecosystem through partnerships with AWS Braket, Azure Quantum, qBraid and Quanta, and is working with NVIDIA and River Lane on calibration and error‑mitigation. In parallel, Rigetti plans to invest up to $100 million in the U.K. over several years, aiming to speed development and deepen its international footprint in a competitive quantum landscape.
Engineering Progress on Scaling and Coherence Challenges
On the engineering front, Rigetti reported progress in mitigating coupling interactions between two‑level couplers at scales above 100 qubits, shifting the main performance bottleneck to coherence times of about 25–30 microseconds. Management outlined levers in chiplet design, materials, fabrication and control electronics and is targeting steady fidelity improvements through 2026 as systems grow.
Rising Operating Expenses and Investment Intensity
Total operating expenses climbed to $27.3 million in Q1 2026 from $22.1 million a year ago, a roughly 23.5% increase concentrated in research, fabrication and system integration. This spending reflects Rigetti’s choice to prioritize long‑term technology leadership and manufacturing capacity, but it also weighs on near‑term profitability metrics.
Wider Operating Loss and GAAP Earnings Volatility
Operating loss widened to $26.0 million from $21.6 million in the prior‑year quarter, an increase of about 20.4%. GAAP net income declined to $33.1 million from $42.6 million as lower noncash fair‑value gains of $53.7 million versus $62.1 million last year introduced significant quarter‑to‑quarter volatility that management warned investors not to over‑interpret.
Gross Margin Pressure from System Mix
Gross margin came in at 31% in Q1 2026 compared with roughly 30% a year earlier, a modest one‑point improvement. However, margins were pressured by a higher share of QPU and system deliveries that bundle lower‑margin third‑party refrigeration components, a dynamic that could persist as hardware shipments grow.
Higher Stock-Based Compensation and Elevated CapEx
Stock‑based compensation increased to $5.9 million from $4.2 million, a jump of about 40.5% that adds to reported operating costs and shareholder dilution. Management also signaled elevated 2026 capital expenditures tied to Fab‑1 upgrades and additional dilution refrigeration capacity needed to support higher qubit counts, reinforcing the capital‑intensive nature of the roadmap.
Modest Revenue Base and Timing Variability
Despite impressive growth rates, the absolute revenue base remains small at $4.4 million for the quarter, leaving results sensitive to deal timing. Management noted that revenue recognition is inherently lumpy, with system shipment schedules and government project milestones causing variability and commercial cloud usage still too early to quantify meaningfully.
Coherence as Key Constraint on Fidelity at Scale
Rigetti identified coherence time as the primary limiter of two‑qubit fidelity at the 108‑qubit scale, with current coherence around 25–30 microseconds. Executives said they need roughly a two‑ to three‑fold improvement to hit intermediate targets such as about 99.5% median two‑qubit fidelity later this year, a key step toward larger, more reliable processors.
Sequential Cash Burn and Runway
Cash and investments slipped modestly from about $589.8 million at year‑end 2025 to roughly $569 million as of March 31, 2026, a sequential decline of around 3.5%. The draw reflects operating spend and capital investments, but the company still appears to have substantial runway to fund its multiyear technology and expansion agenda.
Guidance and Path Toward Quantum Advantage
Management reiterated its near‑term goal to raise Cepheus‑1‑108Q’s median two‑qubit fidelity from about 99.1% to roughly 99.5% this year while keeping gate speeds in the 50–70 ns class, referencing prototypes that have already reached up to 99.9% at 28 ns. Longer term, Rigetti aims for quantum advantage in roughly three years with an around 1,000‑qubit system at about 99.9% two‑qubit fidelity and sub‑50 ns gates, supported by elevated 2026 CapEx, recognition of remaining Novera and C‑DAC orders and a planned multi‑year U.K. investment.
Rigetti’s earnings call painted the picture of a company in heavy investment mode, trading near‑term losses and cash burn for technical milestones and ecosystem expansion. For investors tracking quantum computing, the story hinges on whether Rigetti can convert its strong balance sheet, chiplet‑based scaling progress and early customer wins into sustainable revenue growth as systems grow larger and more reliable.