Down 70%, Should You Buy the Dip on Rigetti Computing?

Shares of Rigetti Computing (NASDAQ: RGTI) are down nearly 70% from their 52-week high (as of Feb. 27, 2026). Not surprisingly, bargain hunters are paying attention. Sharp pullbacks in emerging technology stocks, especially in industries like quantum computing, often prompt investors to ask whether this dip can be an entry point to earn exceptional long-term returns.

Image source: Getty Images.

Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »

But a lower share price does not automatically make a stock attractive. Rigetti remains an early-stage quantum hardware developer operating in a capital-intensive field with minimal revenue, heavy operating losses, negative cash flows, and a concentrated customer base. While the company is advancing its superconducting (electrical circuits that conduct electricity with zero resistance when cooled to extremely low temperatures) quantum processors and cloud-based quantum services, the path to sustainable profitability is still unclear.

Against this backdrop, here are a few key factors investors should consider before deciding whether to buy the dip or ignore it.

Growth catalysts

Management expects Rigetti's 108-qubit Cepheus-1 system to be ready for broader customer use by the end of the first quarter of 2026. This quantum computer, which is built with 108 qubits or basic units of information in quantum computing, is designed to handle more complex calculations than the company's earlier 9-qubit and 36-qubit systems. The company is using a modular design in this 108-qubit system, where smaller quantum chips are linked together rather than building a single large processor. If Rigetti can deliver this system with strong performance and reliability, it would dramatically improve Wall Street's confidence in the company's road map.

Rigetti is also focused on commercializing its technology. The company secured an $8.4 million purchase order from India's Centre for Development of Advanced Computing for a 108-qubit system, scheduled for deployment in the second half of 2026. In September 2025, the company also disclosed two purchase orders worth roughly $5.7 million for two of its smaller 9-qubit systems. These are expected to be delivered in the first half of 2026. While these contracts are relatively small compared to the company's operating losses, they still highlight the company's technology transitioning beyond early-stage experimentation.

Rigetti also has a strong balance sheet, with nearly $600 million in cash and no debt (as of Nov. 6, 2025). The cash balance provides the company with financial flexibility to invest in its road map without immediate funding pressures, something speculative artificial intelligence (AI) stocks cannot claim.

Significant risks

Rigetti trades at over 767 times sales, a valuation that is difficult to justify based on its current financial profile. In the third quarter, the company generated $1.9 million in revenue and reported an operating loss of $20.5 million. The company also used $43.6 million in operating cash flows in the first nine months of fiscal 2025.

Rigetti also has limited revenue visibility. In the first nine months of fiscal 2025, Rigetti earned nearly 91.4% of its revenue from government sales. The high reliance on government and research contracts results in lumpy revenue. While large milestone-based contracts create temporary revenue spikes, they may not necessarily translate into recurring commercial demand.

Rigetti has strengthened its cash balance through a $350 million equity offering in 2025. However, that capital raise has diluted existing shareholders.

Rigetti is a high-risk, milestone-driven stock. Hence, conservative investors may prefer to wait for the company's March earnings report before making any decision.

Manali Pradhan, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.