Rigetti Computing: The Quantum Infrastructure Bet on the S-Curve

The quantum computing market is on a steep adoption S-curve. It is projected to grow from USD 3.52 billion in 2025 to USD 20.20 billion by 2030, a compound annual rate of nearly 42%. This isn't just incremental growth; it's the early phase of a paradigm shift where quantum systems will solve problems intractable for classical computers. In this inflection point, companies like Rigetti Computing are not chasing applications-they are building the fundamental infrastructure layer.

Rigetti's role is that of a full-stack builder. The company's open and modular architecture is designed to integrate with the broader quantum ecosystem, as evidenced by its support for NVIDIA's NVQLink platform. This collaboration is a critical signal. It positions Rigetti's hardware not as a standalone device but as a plug-in for next-generation AI supercomputers, accelerating the development of hybrid quantum-classical workflows. This is infrastructure work: creating the connective tissue between the nascent quantum paradigm and the dominant classical computing world.

The technical metric that validates this infrastructure bet is reliability. For quantum systems to scale beyond lab curiosities, they must achieve high gate fidelity. Rigetti has hit a key benchmark, achieving a 99% median two-qubit gate fidelity on its 108-qubit Cepheus-1-108Q prototype. This is a critical reliability threshold for error correction and scalability. The company is targeting an even higher 99.5% fidelity before the system's general availability, which is now scheduled for the end of the first quarter of 2026. This focus on performance over a rushed launch underscores a builder's mindset: laying a solid foundation for exponential growth.

Financial Reality vs. Exponential Potential

The numbers tell a clear story of a company in the deep pre-revenue phase of a technological S-curve. For all the promise of quantum infrastructure, Rigetti's current financials reflect the heavy investment required to build it. The company reported revenue of just $1.9 million for the third quarter of 2025, a figure that underscores the market's infancy. This minimal top-line flow is dwarfed by the operational burn. The GAAP net loss for the quarter was $201.0 million, a staggering figure that includes a large, non-cash accounting charge. Strip out those items, and the non-GAAP net loss was $10.7 million, still a significant cash burn rate for a company not yet selling its core product at scale.

This is the classic profile of an infrastructure builder. The cash burn is the cost of the exponential build-out, funding the aggressive roadmap to 1,000+ qubits by 2027. The financial runway, however, is not infinite. As of September 30, 2025, the company held $558.9 million in cash and investments. Subsequent warrant exercises added another $46.5 million, bringing the total to roughly $600 million. Management has indicated this provides a ~12-18 month runway. That timeline is tight against the multi-year horizon for commercial quantum advantage.

The tension here is between the long-term paradigm shift and the short-term capital need. The company is burning cash to hit fidelity targets and scale qubit counts, but revenue is still a distant prospect. The recent $5.7 million in purchase orders for 9-qubit systems is a positive signal of early commercial traction, yet it does little to offset the operational losses. For investors, the bet hinges on whether Rigetti can execute its technical roadmap before the cash runs out, turning its infrastructure layer from a costly prototype into a revenue-generating platform. The financial reality is one of high risk and high potential, with the runway now the critical variable.

The 108-Qubit Catalyst and Roadmap Execution

The immediate technical catalyst is now in sight. Rigetti has revised the general availability target for its 108-qubit Cepheus-1-108Q system to around the end of the first quarter of 2026. This is a slight delay from an earlier timeline, but the company frames it as a necessary step to optimize performance. CEO Dr. Subodh Kulkarni stated the pushback allows more time to test and refine the system, particularly addressing complexities with its tunable couplers, to ensure it meets the company's high standards before release.

The core of this optimization is a critical fidelity goal. Rigetti is targeting a 99.5% median two-qubit gate fidelity for the system at launch. Achieving this milestone is not just a technical boast; it is the benchmark for demonstrating system reliability and commercial viability. Gate fidelity measures how accurately quantum operations are performed. A 99.5% target is a key threshold for error correction, the essential process that will allow quantum systems to scale beyond a few dozen qubits. Hitting it would validate Rigetti's modular architecture as a path to practical, large-scale quantum computing. The company already reports a 99% median two-qubit gate fidelity on its 108-qubit prototype, showing it is on track, but the final push to 99.5% is the make-or-break step for the 2026 launch.

This near-term milestone is part of a much more ambitious, multi-year S-curve. The roadmap laid out by the company calls for deploying a 1,000+ qubit system by or around the end of 2027. This target is the exponential phase of the build-out. It requires not just scaling qubit counts but also maintaining or improving fidelity-aiming for 99.8% at that scale. The modular chip architecture, which combines twelve 9-qubit chiplets into the 108-qubit system, is the foundational design intended to make this leap feasible. The execution risk here is immense. Each step up the qubit count introduces new engineering challenges, as the company itself noted with the coupler issues. Success would cement Rigetti's position as the infrastructure layer for the quantum paradigm. Failure to meet these aggressive milestones, however, would severely undermine the long-term investment thesis and accelerate the pressure on its financial runway.

The Quantum Talent and Operating Environment: A Key Risk Factor

The most critical, often overlooked risk for quantum infrastructure builders like Rigetti is not a technical hurdle, but a human one. The global pool of highly trained quantum experts is severely constrained. As Deloitte's scenario analysis highlights, the "quantum talent and operating environment" is a primary uncertainty that directly shapes the pace of scalable quantum computing. Organizations are competing for a few thousand high-cost specialists, creating a talent war that can bottleneck development.

This scarcity is a key variable in Deloitte's four plausible futures. In the "Surprise" scenario, where scalable quantum arrives sooner than expected, the undeveloped talent ecosystem leads to a fierce battle for scarce resources. Early investors gain significant advantages, while others struggle to access both computing capacity and the expertise needed to use it. For Rigetti, this means its aggressive roadmap is only as fast as its ability to hire and retain top engineers and physicists. Any delay in building its technical team could ripple through its entire development timeline.

Recognizing this, Rigetti is taking a strategic step to mitigate the risk. The company plans to open an Italian subsidiary to tap into Europe's growing quantum talent pool. This geographic expansion is a direct response to the operating environment uncertainty. By establishing a presence in a region with strong academic programs and government investment in quantum, Rigetti aims to access a broader pool of skilled workers and strengthen its ecosystem partnerships. It is a move to build its own talent infrastructure in parallel with its hardware infrastructure.

The bottom line is that quantum scaling is a race against both physics and people. Rigetti's technical milestones are ambitious, but their execution is contingent on securing the right human capital. The company's plan to expand into Italy is a prudent hedge against the severe talent shortage, but it also underscores that this is a fundamental constraint on the entire S-curve. For the investment thesis to hold, Rigetti must not only build better qubits but also build a more capable team to build them.

Valuation, Scenarios, and What to Watch

The investment thesis for Rigetti is a classic bet on an exponential S-curve. The valuation multiple reflects that future potential, not today's reality. With a market cap implying a multiple of over 160x its projected 2027 sales, the stock prices in a world where quantum computing becomes a mainstream infrastructure layer. This premium is justified only if the company successfully navigates the next few years to deliver on its roadmap. The current setup is one of high risk and high potential, where the next catalysts will determine if the market's patience holds.

The two major uncertainties that will define the company's path are the pace of scalable quantum computing and the availability of quantum talent. As Deloitte's scenario analysis shows, these are the intersecting axes that create four plausible futures leading into 2030. The "Surprise" scenario, where scalable quantum arrives sooner than expected, would be a massive boon for early builders like Rigetti. But it also hinges on a developed talent ecosystem, which is currently a primary uncertainty. The company's plan to open an Italian subsidiary is a direct hedge against this talent scarcity, aiming to build its human infrastructure in parallel with its hardware.

Key risks are numerous and material. The most immediate is continued cash burn. Despite a recent warrant exercise adding $46.5 million to its war chest, the company's GAAP net loss of $201.0 million in Q3 2025 underscores the heavy investment required. The financial runway, now estimated at 12-18 months, is tight against the multi-year horizon for commercial quantum advantage. Technological delays are another clear risk, as evidenced by the slight delay to the Q1 2026 launch to optimize fidelity. Competition from giants like IBM and AWS, which have deeper pockets and broader ecosystems, also looms large. Finally, the long timeline for a material market shift means the company must execute flawlessly for years to come.

The key catalysts and what to watch are now in the near term. The first is the Q1 2026 launch of the Cepheus-1-108Q system. Success here is not just about shipping a product; it's about demonstrating that Rigetti can deliver a high-fidelity, modular system to market. The specific milestone to watch is whether the company hits its 99.5% median two-qubit gate fidelity target before general availability. This is the technical benchmark for commercial viability. Beyond that, investors must monitor Rigetti's progress in talent acquisition and partnerships, particularly its new European operations, as a proxy for its ability to scale its human capital. The next few quarters will separate the infrastructure builder from the footnote.