Rigetti Computing, Inc. Q2 FY2025 earnings call

• Demonstrated the industry's largest multi-chip quantum computer, Cepheus-1-36Q, which is released for general availability and deployed on Rigetti Quantum Cloud Services platform and will be available on Microsoft Azure. It has a median 2-qubit gate fidelity of 99.5% with a 2x reduction in 2-qubit gate error rate from previous systems.
• Transitioning from monolithic chips to chiplets improves performance, reduces manufacturing complexity, and enables scaling. Features like optimized 2-qubit gates and advances in chip design contribute to improved performance.
• Completed a $350 million gross proceeds sale of common stock, strengthening the balance sheet to support commercial scale-up of superconducting gate-based quantum computers.

In the second quarter of 2025, Rigetti's revenues were $1.8 million compared to $3.1 million in the second quarter of 2024. Gross margins were 31% versus 64% in the prior year. Total OpEx was $20.4 million vs $18.1 million. Operating loss was $19.9 million vs $16.1 million. Net loss was $39.7 million vs $12.4 million. As of June 30, 2025, the company had approximately $571.6 million of cash, cash equivalents, and available-for-sale investments with no debt. Revenue contribution details weren't specified in terms of segments, but overall financials show a year-over-year decline in revenues and increase in losses.

• Intend to release a 100-plus qubit chiplet-based system with 99.5% median 2-qubit gate fidelity before the end of 2025.
• Aim to hit end-of-year technology goals, including quadrupling chiplet count and significantly decreasing error rates towards achieving quantum advantage and fault tolerance.

• Forward-looking statements are subject to risks and uncertainties discussed in SEC filings, such as those related to government funding and technological challenges.
• Dependence on government funding for initiatives like the National Quantum Initiative (NQI) reauthorization, which hasn't been finalized yet, could impact future sales and R&D plans.
• Challenges in scaling quantum computers further, including issues with gate speeds, error correction, and integrating components like flex cables in dilution refrigerators.

Q: What is the intention with the proceeds from the strong balance sheet?

A: Focus remains on R&D development, with the plan to accelerate timelines to hit milestones. Currently funding R&D adequately to reach laid-out milestones, and looking to accelerate timelines if opportunities arise with the strengthened balance sheet.

Q: How confident are you in achieving the 100-plus qubit chip with the same fidelity?

A: Confident with the chiplet approach, as the fundamental architecture is defined and scaling up becomes easier with the chiplet method. However, multiple challenges remain, but confident of reaching the goal before the end of 2025.

Q: Is M&A an important part of the growth story?

A: Will continue to look at M&A opportunities to accelerate timelines if they help, but currently don't see tactical opportunities that would significantly help accelerate the timeline.

Q: What are the road map plans for gate speeds towards quantum advantage?

A: Gate speeds need to be faster than 50 nanoseconds. Currently at about 70 nanoseconds with Cepheus-1, working to accelerate to get below 50 nanoseconds, as gate speed is critical for integrating quantum computers into existing data centers with CPUs and GPUs.

Q: When will quantum error correction codes like QLDPC be implemented?

A: Currently focusing on fidelity and qubit count, and quantum error correction work is ongoing with partners, but not at the stage of implementing sophisticated codes like QLDPC yet; a year or 2 away from starting that work.

Q: What's the status of the NQI reauthorization?

A: Bipartisan support exists, with multiple versions of the bill in committees and hearings ongoing. Hope for reauthorization soon, but it hasn't been signed yet, though interactions with government entities continue strongly.

Q: How is the collaboration with Quanta progressing?

A: Quanta is working on the non-QPU portion of the hardware stack, specifically control systems, and the partnership is progressing well, with Quanta's focus on getting up to speed in control systems to work with Rigetti's QPUs.