Rigetti Computing (RGTI) Stock: Why Quantum Fever Sent Shares Soaring 26%

TLDR

Rigetti Computing (RGTI) stock jumped 26.46% to $13.86, hitting a 3-month high on Thursday Craig-Hallum raised price target to $14, just 1% above Thursday’s closing price Options activity surged with 65,294 call options traded, three times expected volume Q1 2025 revenue dropped 52% to $1.47 million while operating losses grew 30% to $21.6 million Company secured $35 million strategic investment from Quanta Computer Inc

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Rigetti Computing stock rocketed 26.46% higher on Thursday, closing at $13.86 per share and reaching its highest level in three months. The quantum computing company rode a wave of enthusiasm that lifted the entire sector.

Rigetti Computing, Inc. (RGTI)

The rally came as fellow quantum computing stocks also climbed higher during the session. D-Wave Quantum, Quantum Computing Inc, and IONQ all posted gains as investors showed renewed interest in the space.

Industry developments helped fuel the excitement. A competing quantum computing firm launched a new computer that claims to solve problems beyond the reach of traditional GPU-based supercomputers.

Quantum is hot again and Rigetti Computing $RGTI is riding the wave up 25% today on news that both Deutsche Bank $DB and Bank of American $BAC increased their holdings in Rigetti released through their 4th quarter 13F filings.

Deutsche $DB increased their position by 79% up to a… pic.twitter.com/Fu3mt9hNZS

— Tradure (@TradureApp) May 22, 2025

Analyst Upgrade Provides Additional Boost

Craig-Hallum added momentum to the stock by raising its price target to $14. With Thursday’s close at $13.86, Rigetti now trades just 1% below the new target price.

The upgraded target reflects growing analyst confidence in the company’s prospects. Five analysts currently cover the stock with an average price target of $14.80.

Wall Street’s consensus recommendation sits at 2.0 on a scale of 1 to 5. This “Outperform” rating comes from six brokerage firms tracking the company.

Options traders jumped on the rally with unusual activity. A total of 65,294 call options changed hands, representing three times the typical volume.

The surge in bullish bets pushed implied volatility up more than 6 points to 110.04%. Weekly call options with strikes at $12 and $13 saw the heaviest trading.

The put-call ratio dropped to just 0.20, showing strong preference for bullish positions over bearish ones. This lopsided ratio often signals short-term momentum in the stock.

Financial Challenges Persist

Despite the stock’s rally, Rigetti’s recent financial results paint a different picture. First quarter revenue fell 52% year-over-year to $1.47 million from $3.05 million.

The revenue decline hit profitability hard. Operating losses expanded 30% to $21.6 million compared to $16.58 million in the prior year period.

Gross margins also compressed during the quarter. The company reported 30% gross margins in Q1 2025, down from 49% in the same period last year.

Lower margin contracts contributed to the decline in profitability metrics. Operating expenses meanwhile climbed to $22.1 million from $18.1 million previously.

Higher salary costs and increased stock compensation drove the expense growth. These headwinds offset some of the company’s operational progress.

Recent Business Wins Offer Hope

Rigetti secured several important business developments that could drive future growth. The company closed a strategic investment deal with Quanta Computer Inc worth approximately $35 million.

DARPA selected Rigetti to participate in its quantum benchmarking initiative. This program advances the company’s utility scale quantum computer concept.

The Air Force Office of Scientific Research awarded funding to develop Rigetti’s chip fabrication technology. The company is working with prestigious academic institutions on this breakthrough technology called ABAA.

Rigetti also won three Innovate UK Quantum Miss Pilot Awards. These grants support advancement of superconducting quantum computing technology.

The company achieved a technical milestone by demonstrating optical control of a superconducting qubit. This breakthrough could help scale quantum systems more effectively.

However, funding challenges remain on the horizon. The passage of the NQI reauthorization bill has been delayed, which could impact potential sales and funding opportunities.

Rigetti is scheduled to report its next quarterly earnings on August 7th.

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