Rigetti Computing’s Landmark India Contract Fuels Investor Optimism

Rigetti US76655K1034

A significant government contract secured in January has propelled shares of quantum computing firm Rigetti Computing into the spotlight, generating considerable investor enthusiasm. The company announced an $8.4 million deal with India’s state-run Centre for Development of Advanced Computing (C-DAC), a move widely interpreted as a transition from pure research to commercial hardware delivery. However, with a market capitalization of $7.27 billion and a price-to-sales multiple of 824, questions are emerging about whether the market’s optimism has run too far ahead of present financial realities.

The current valuation tells a story of future potential rather than current profitability. For the third quarter of 2025, reported on November 10, Rigetti posted an 18.1% year-over-year decline in revenue. Over the trailing twelve months, the company’s net loss totals approximately $201 million. CEO Subodh Kulkarni has acknowledged that it may take another three to five years before substantial revenue streams materialize.

Despite these figures, the stock has surged over 2,400% since the start of 2023. The extreme valuation, which dwarfs the average for the technology sector, represents a high-stakes bet on Rigetti’s future dominance in the quantum computing arena.

A Pivotal Deal for Commercial Validation

The catalyst for recent excitement was the January 21, 2026, announcement of the firm contract with C-DAC. Analysts view this as a critical validation of Rigetti’s superconducting qubit technology. Unlike many non-binding research partnerships or letters of intent common in the industry, this agreement involves the concrete delivery of a functional quantum computer system.

This deal distinguishes Rigetti from competitors such as D-Wave Quantum or Alphabet’s Google, which are also active in quantum development. While executives at Google have suggested "useful" quantum applications may still be a decade away, Rigetti is now positioning itself as a hardware supplier for government clients.

Wall Street Responds with Upgraded Targets

The market’s reaction was swift, with several major financial institutions revising their outlooks upward shortly after the contract news:

• Mizuho: Assigned an Outperform rating with a $50 price target.
• Rosenblatt Securities: Issued a Buy rating and a $40 price target.
• B. Riley Securities: Upgraded the stock to Buy on January 22, setting a $35 target.
• Wedbush: Also rated the shares Outperform, with a $35 price target.

These targets suggest potential upside of 60% to 130% from recent trading levels, even following the historic multi-year rally.

Upcoming Catalyst and Market Sentiment

All eyes are now on the next quarterly report, scheduled for March 4, 2026. Investors will be scrutinizing two key areas: any concrete updates on the delivery timeline for the Indian system, and the projected cash burn rate for 2026. The stock currently carries a short interest of 13.37%, indicating a sizable contingent of investors betting against its success. Any positive developments could trigger a short squeeze, potentially leading to further sharp price increases.

The India contract undoubtedly marks a strategic step from the research lab toward becoming a commercial provider. Whether the aggressive market valuation is justified will hinge entirely on Rigetti’s ability to secure follow-on large-scale contracts—and to do so within a timeframe that supports the current sky-high expectations.

@ boerse-global.de | US76655K1034 RIGETTI