U.S. Government Invests $2 Billion in Quantum Computing
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Source: Fool
- Large Investment Scale: The U.S. Department of Commerce announced a $2 billion investment across nine quantum computing companies under the CHIPS and Science Act, granting the government minority equity stakes in each, highlighting the importance of quantum technology and its potential in AI.
- Key Companies Funded: International Business Machines (IBM) will receive $1 billion to establish a new quantum foundry subsidiary called Anderon, while GlobalFoundries is raising $375 million to build a complementary foundry, enhancing the domestic manufacturing base for quantum chips.
- Multiple Companies Benefit: Other firms like D-Wave, Rigetti, and Infleqtion each received up to $100 million to address specific engineering variables and modalities, further advancing the research and development of quantum computing.
- Investor Focus: While IBM and GlobalFoundries are publicly traded, quantum computing represents a small part of their overall business, prompting investors to be selective and consider pure-play quantum companies like D-Wave and Rigetti, or indirectly invest through Honeywell and Nvidia for quantum exposure.
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Analyst Views on RGTI
Wall Street analysts forecast RGTI stock price to rise
10 Analyst Rating
7 Buy
3 Hold
0 Sell
Moderate Buy
Current: 26.880
Low
30.00
Averages
39.75
High
51.00
Current: 26.880
Low
30.00
Averages
39.75
High
51.00
About RGTI
Rigetti Computing, Inc. is a full-stack quantum computing company. The Company operates quantum computers over the cloud and serves global enterprise, government, and research clients through its Rigetti Quantum Cloud Services platform. The Company’s quantum-classical infrastructure provides high-performance integration with public and private clouds for practical quantum computing. It has developed a multi-chip quantum processor for scalable quantum computing systems. Through the Company’s Quantum Computing as a Service (QCaaS) platform, its machines can be integrated into any public, private or hybrid cloud. It is also engaged in the sale of quantum processing units (QPUs) and custom computing components, and development contracts and other services. Its QPUs contain fabricated silicon-based chips featuring superconducting qubits. The Company designs and manufactures its chips in-house at Fab-1, an integrated quantum device manufacturing facility.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Government Funding Support: The U.S. government has allocated $100 million to Rigetti as part of a larger $2 billion quantum investment package, providing crucial funding for the company's research and development efforts to advance its technology.
- Financial Condition Analysis: Despite Rigetti's revenue nearly tripling year-over-year from $1.5 million to $4.4 million, the company is still burning $20 million in free cash flow each quarter, highlighting the fragility of its business model.
- Valuation Concerns: Rigetti's shares currently trade at an extreme price-to-sales ratio of nearly 900, and while the technology holds promise, such high valuation could lead to significant stock price volatility if market sentiment shifts, necessitating careful risk assessment by investors.
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- Large Investment Scale: The U.S. Department of Commerce announced a $2 billion investment across nine quantum computing companies under the CHIPS and Science Act, granting the government minority equity stakes in each, highlighting the importance of quantum technology and its potential in AI.
- Key Companies Funded: International Business Machines (IBM) will receive $1 billion to establish a new quantum foundry subsidiary called Anderon, while GlobalFoundries is raising $375 million to build a complementary foundry, enhancing the domestic manufacturing base for quantum chips.
- Multiple Companies Benefit: Other firms like D-Wave, Rigetti, and Infleqtion each received up to $100 million to address specific engineering variables and modalities, further advancing the research and development of quantum computing.
- Investor Focus: While IBM and GlobalFoundries are publicly traded, quantum computing represents a small part of their overall business, prompting investors to be selective and consider pure-play quantum companies like D-Wave and Rigetti, or indirectly invest through Honeywell and Nvidia for quantum exposure.
See More
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- Rise of Rigetti Computing: Rigetti recently launched its most powerful quantum computer, the Cepheus-1-108Q, capturing investor attention; however, with its stock price soaring over 50% in a month, its current price-to-sales ratio of nearly 900 indicates extreme valuation concerns.
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See More
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- Government Funding Support: The U.S. government has allocated $100 million to Rigetti as part of a larger $2 billion quantum investment package, providing crucial funding for the company's research and development efforts to advance its technology.
- Financial Condition Analysis: Despite Rigetti's revenue nearly tripling year-over-year from $1.5 million to $4.4 million, the company is still burning $20 million in free cash flow each quarter, highlighting the fragility of its business model.
- Valuation Concerns: Rigetti's shares currently trade at an extreme price-to-sales ratio of nearly 900, and while the technology holds promise, such high valuation could lead to significant stock price volatility if market sentiment shifts, necessitating careful risk assessment by investors.
See More
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- GameStop's Strong Earnings: GameStop reported first-quarter revenue of $835.3 million, reflecting a 14% year-over-year increase, and the board approved a $2 billion share repurchase authorization, which not only boosts investor confidence but may also enhance future shareholder returns.
- Energy Stocks Boosted by Oil Prices: Oil prices rose nearly 2% after Israeli Prime Minister Netanyahu indicated readiness to act against Iran, lifting energy stocks, with Exxon Mobil and Marathon Petroleum both gaining 3%, suggesting sustained market optimism regarding energy demand.
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See More
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- Earnings Beat: IonQ reported Q1 2026 revenue of $64.7 million, surpassing analyst expectations of $49.7 million and setting a new company record, indicating strong market demand and growth potential.
- Profitability Improvement: The company posted diluted earnings per share (EPS) of $2.07, a significant turnaround from a loss of $0.14 per share in Q1 2025, boosting investor confidence in future profitability.
- Optimistic Guidance: IonQ raised its 2026 revenue outlook to between $260 million and $270 million, with the midpoint suggesting approximately 104% year-over-year growth, reflecting strong confidence in future performance.
- Technological Advancement: IonQ presold its first 256-qubit system in Q1, with customer systems expected to begin commissioning by the end of Q2 2027, further solidifying its leadership in quantum computing and attracting investor interest.
See More
U.S. Government Invests $2 Billion in Quantum Computing
- Large Investment Scale: The U.S. Department of Commerce announced a $2 billion investment across nine quantum computing companies under the CHIPS and Science Act, granting the government minority equity stakes in each, highlighting the importance of quantum technology and its potential in AI.
- Key Companies Funded: International Business Machines (IBM) will receive $1 billion to establish a new quantum foundry subsidiary called Anderon, while GlobalFoundries is raising $375 million to build a complementary foundry, enhancing the domestic manufacturing base for quantum chips.
- Multiple Companies Benefit: Other firms like D-Wave, Rigetti, and Infleqtion each received up to $100 million to address specific engineering variables and modalities, further advancing the research and development of quantum computing.
- Investor Focus: While IBM and GlobalFoundries are publicly traded, quantum computing represents a small part of their overall business, prompting investors to be selective and consider pure-play quantum companies like D-Wave and Rigetti, or indirectly invest through Honeywell and Nvidia for quantum exposure.
See More
Quantum Computing Stocks Surge Amid AI Enthusiasm but Face Risks
- Market Performance: The S&P 500 index has risen 6.3% over the past month, while the tech-heavy Nasdaq Composite surged 9.4%, reflecting strong investor confidence in the tech sector driven by renewed enthusiasm for artificial intelligence.
- Rise of Rigetti Computing: Rigetti recently launched its most powerful quantum computer, the Cepheus-1-108Q, capturing investor attention; however, with its stock price soaring over 50% in a month, its current price-to-sales ratio of nearly 900 indicates extreme valuation concerns.
- Financial Improvement: Rigetti's revenue nearly tripled year-over-year last quarter, increasing from $1.5 million to $4.4 million, while the company holds over $400 million in cash, double what it had a year ago, suggesting an improvement in its financial health.
- Impact of Government Funding: The U.S. government will provide $100 million to Rigetti as part of a larger $2 billion quantum investment package, which will fund research and development on unproven technology, although this funding is more akin to a grant than an investment.
See More
U.S. Government Invests $2 Billion in Quantum Computing Firms
- Massive Investment: The U.S. government has recently invested a total of $2 billion in nine quantum computing companies, with IBM receiving half of the funding, indicating strong governmental support that could accelerate industry growth.
- Order and Revenue Growth: Rigetti secured an $8.4 million order, D-Wave announced a record $33.4 million in bookings for Q1, and IBM partnered with the Department of Commerce to establish a new quantum wafer foundry, reflecting rising market demand for quantum computing.
- Impressive Sales Data: IonQ's revenue surged 755% in Q1, Rigetti's jumped 199%, and IBM achieved a respectable 9% increase, although D-Wave's revenue fell by 81%, the overall trend indicates significant industry potential.
- Investment Risk Advisory: While the quantum computing market is projected to reach $100 billion by 2035, the high price-to-sales ratios and losses of companies like IonQ, Rigetti, and D-Wave present considerable investment risks, suggesting investors should focus on IBM's stable performance.
See More
