Artificial intelligence (AI) dominated headlines in 2023 and 2024, with names like Nvidia (NVDA) and Palantir (PLTR) becoming household staples. But now, some on Wall Street are shifting their gaze to the next big technological frontier: quantum computing.
And why not? After all, quantum computing isn’t just theoretical anymore. It’s leaping out of sci-fi novels and into reality, especially after breakthroughs like Google’s Willow chip. This technological marvel solved a problem in just five minutes that would’ve kept a traditional supercomputer busy for—brace yourself—10 septillion years.
With advancements like this, Wall Street isn’t just watching; it’s jumping in. Quantum computing stocks are skyrocketing, and analysts are dishing out “Strong Buy” ratings like confetti. Two companies in particular—Rigetti Computing and D-Wave Quantum—are stealing the spotlight. But is this a revolution in the making or just another bubble waiting to pop?
Rigetti Computing: A Rising Star with Big Ambitions
Rigetti Computing, based in California, is knee-deep in quantum innovation. The company wears two hats:
- It builds the integrated circuits that go into quantum chips.
- It runs a cloud platform called Forest, where programmers can dabble in quantum algorithms.
Their ultimate goal? Achieving “narrow quantum advantage.” In simpler terms, Rigetti wants to reach the point where quantum computing isn’t just better—it’s cheaper, too, for solving real-world problems.
The Numbers Game
But here’s where things get tricky. Rigetti’s stock has skyrocketed a jaw-dropping 1,870% in the last year—yes, you read that right. And in just the past month, it’s up over 500%, hitting a record high of $20.37. This kind of surge makes you wonder: is it all hype, or is there something tangible here?
Financially, the picture isn’t exactly rosy. Rigetti’s Q3 2024 revenue slid to $2.4 million from $3.1 million the previous year. Gross profit was nearly halved, down to $1.2 million from $2.3 million. The company blames delays in government funding and some low-margin contracts for the slump.
Why Investors Are Still Hooked
Despite the financial hiccups, Rigetti has a bold roadmap. They’re planning to roll out:
- A 36-qubit system.
- A 100-qubit system.
- A 336-qubit system.
It’s incremental, sure, but it’s enough to keep investors dreaming of the day quantum computers outpace traditional ones. Analysts, meanwhile, have a “Strong Buy” consensus rating on the stock, though its recent surge has already blown past the median price target of $5.20.
So, is Rigetti the next Nvidia, or just a flash in the pan? The jury’s still out.
D-Wave Quantum: The First Mover Advantage
D-Wave Quantum, another California darling, has already cemented its place in history as the first company to commercially release a quantum computer. It proudly calls itself the only “full-stack” quantum computing provider, offering everything from systems to cloud services to development tools.
What Sets D-Wave Apart
Its flagship products include:
- The Advantage quantum computer, a beast of a machine.
- The Leap cloud service, which gives users direct access to quantum computing capabilities.
D-Wave’s stock performance mirrors the quantum buzz. Over the past year, shares have soared 1,084%, and they’re up 232% in just the last month. After hitting a record high of $11.41 in December 2024, the stock has pulled back slightly, trading around $9.70.
The Financial Picture
Here’s the catch: D-Wave’s Q3 revenue was down, dipping by $0.7 million to $1.9 million. But—and it’s a big but—its Quantum Computing as a Service (QCaaS) revenue jumped 41%, hitting $1.6 million. The company chalks this up to a higher average revenue per customer.
Gross profit, however, fell from $1.5 million to $1 million, and like Rigetti, D-Wave cites contract timing and R&D expenses as reasons for the fluctuations.
Looking Forward
D-Wave isn’t slowing down. It’s prepping for the commercial launch of its Advantage2 quantum computer, which will boast a staggering 4,400 qubits. The company also updated its roadmap in 2024, aiming to push quantum computing into more AI and machine learning applications.
Analysts are bullish here, too, with a “Strong Buy” consensus rating. But again, the stock has already surged past its average price target of $5.18.
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Final Thoughts: Boom or Bubble?
Quantum computing is no doubt a thrilling frontier, but it’s also one that’s fraught with challenges. Rigetti and D-Wave have promising technologies and ambitious roadmaps, but they’re not immune to the growing pains of an industry still finding its footing.
For now, Wall Street is betting big, and the excitement is contagious. But as with any gold rush, it’s worth asking: who’s striking it rich, and who’s just panning for fool’s gold?
Disclaimer: The author does not hold positions in the securities mentioned. This article is for informational purposes only.