Rigetti Computing’s Major Indian Contract Fails to Impress Skeptical Market

Rigetti US76655K1034

Despite announcing a landmark contract that nearly matches its entire 2024 revenue, Rigetti Computing's shares experienced a surprising decline. The market's tepid response highlights investor concerns that extend beyond a single deal, focusing instead on the company's ongoing financial challenges and the competitive quantum computing landscape.

The quantum computing firm has secured an $8.4 million agreement with India's Centre for Development of Advanced Computing (C-DAC). The scale of this single contract is significant, representing approximately 76% of Rigetti's total revenue for the 2024 fiscal year, which stood at roughly $11 million. Under the terms of the deal, Rigetti will deliver a 108-qubit quantum computer to a data center in Bengaluru. The system will be built using the company's proprietary chiplet architecture, with installation scheduled for the second half of 2026.

Investor Sentiment Remains Cautious

The announcement was met with skepticism on Wall Street. In recent US trading, Rigetti's stock price declined by 2.46% to $24.99. This negative movement appears rooted in the company's current financial position. While the order book is strengthening, Rigetti continues to report substantial losses, including an EBITDA loss of $62 million. The lengthy timeline until project completion in late 2026 means the deal does not provide immediate cash flow, requiring continued patience from shareholders as the company works to improve its burn rate.

Competitive pressures are also intensifying. Just one day prior to Rigetti's announcement, rival D-Wave revealed its acquisition of Quantum Circuits Inc., a move that escalates the battle for market share in the quantum sector. Rigetti's Indian contract forms part of that nation's "National Quantum Mission" and could pave the way for additional government orders if executed successfully.

Analyst Outlook Contrasts with Short-Term Volatility

Financial analysts maintain a constructive long-term view despite the current share price weakness. The consensus rating among experts currently stands at "Moderate Buy," with an average price target of $39.78. This target implies a potential upside of approximately 59% from the current trading level.

Attention now shifts to operational execution. Investor confidence in the coming quarters will hinge on Rigetti's ability to adhere to the late-2026 delivery schedule for the C-DAC system. Furthermore, the market will closely monitor how payment milestones from this substantial contract affect the company's liquidity position in the interim period.