Why Did RGTI Stock Plunge 45%?

Rigetti Computing (NASDAQ: RGTI), a quantum computing company, saw its stock plunge 45% on Wednesday, January 8. This move came after the Nvidia CEO – Jensen Huang – stated that useful quantum computing is still 20 years away. The decline was seen across quantum computing stocks, with IONQ falling 39%, and D-Wave falling 36%. It is a known fact that quantum computing remains in a developmental stage and is not yet ready for widespread practical implementation across industries. The timeline for mainstream adoption of these systems remains uncertain — it could materialize within the next ten years, or potentially take longer to achieve. However, the fall in these stocks seems exorbitant.

As with any new futuristic technology, things may be volatile at times. That said, if you want upside with a smoother ride than an individual stock, consider the High-Quality portfolio, which has outperformed the S&P, and clocked >91% returns since inception.

Rigetti is a leading player in the emerging quantum computing ecosystem. It has developed a quantum processing unit (QPU) called Novera with 9 qubits, designed for local deployment. It offers a Quantum Computing as a Service (QCaaS) platform that enables their quantum systems to be seamlessly integrated across various cloud environments. 

Rigetti Computing has expanded its quantum computing lineup with the introduction of its Ankaa-3 system, featuring 84 qubits and enhanced precision through upgraded hardware components and sophisticated capabilities. Looking ahead, Rigetti’s 2025 roadmap includes two new quantum systems: a 36-qubit model and an advanced system exceeding 100 qubits, both engineered with a focus on improved reliability, targeting a 2x reduction in error rates. ^[1] These developments represent significant steps toward making quantum computing technology more viable for practical applications.

Notably, there have been some advancements lately with Google’s Willow chip and Amazon’s Quantum Embark in the quantum space. This has fueled the rally in the quantum stocks at large, including RGTI stock. Furthermore, a $2.7 billion government funding for quantum computing has boded well for these stocks. We continue to believe that Rigetti is favorably placed in the quantum space, and the recent dip offers an opportunity for investors to pick RGTI for robust long-term gains. That said, investors should take into account the risks. RGTI stock is a high-risk high-growth potential story, with various factors at play, including technological improvements and costs. As an investor, the bet will be on the future potential of quantum computing and Rigetti’s place in it. 

Looking at its past performance, RGTI stock has been quite volatile when compared to the broader markets. Returns for the stock were -92% in 2022, 35% in 2023, and 1449% in 2024.While RGTI stock has seen mixed growth over recent years, the Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has provided better returns with less risk versus the benchmark S&P 500 index over the last four year period; less of a roller-coaster ride as evident in HQ Portfolio performance metrics.

[1] Returns as of 1/9/2025
[2] Cumulative total returns since the end of 2016

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1. Rigetti’s Press Release, Dec 23, 2024 [↩]