Executive Summary
Rigetti Computing (RGTI) reported a challenging Q4 2023, with revenues falling to $3.4 million from $6.1 million year-over-year, amidst significant advancements in their quantum technology offerings. The company addressed a notable decrease in total operating expenses, highlighting operational streamlining and strategic focus on key growth initiatives, including their anticipated Ankaa-3 quantum processor aimed at improving error rates in quantum computation. Despite facing a net loss of $12.6 million, RGTI continues to enhance its technology platform, garnering support from collaborations with government entities and academic institutions for upcoming projects, including a 24-qubit quantum system in the UK. Investors should closely monitor Rigetti’s path towards profitability through its technology maturation and strategic partnerships in the quantum computing sector.
Key Performance Indicators
QoQ: -52.58% | YoY:-79.49%
QoQ: -43.41% | YoY:-48.01%
QoQ: -47.35% | YoY:-55.25%
Key Insights
**Revenue:** Q4 2023 revenue declined by 44.29% year-over-year to $3.4 million, showing marginal growth of 8.73% compared to Q3 2023.\n**Gross Profit Margin:** Achieved a gross profit margin of 75%, down from 87% in Q4 2022 due to lower revenues.\n**Operating Expenses:** Total operating expenses were significantly reduced to $19.7 million from $32 million in the previous year, reflecting cost management efforts.\n**Net Loss:** Reported a net loss of $12.6 million, an improvement from $22.9 milli...
Financial Highlights
Revenue: Q4 2023 revenue declined by 44.29% year-over-year to $3.4 million, showing marginal growth of 8.73% compared to Q3 2023.\nGross Profit Margin: Achieved a gross profit margin of 75%, down from 87% in Q4 2022 due to lower revenues.\nOperating Expenses: Total operating expenses were significantly reduced to $19.7 million from $32 million in the previous year, reflecting cost management efforts.\nNet Loss: Reported a net loss of $12.6 million, an improvement from $22.9 million in the same quarter last year.\nCash Position: Cash and equivalents totaled $99.9 million, down from $110.2 million in Q3, providing a runway into Q3 2025, underpinned by recent financing initiatives and ongoing evaluations of capital structure.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
3.38M |
-44.29% |
8.73% |
| Gross Profit |
1.08M |
-79.49% |
-52.58% |
| Operating Income |
-17.21M |
-19.40% |
2.23% |
| Net Income |
-12.57M |
-48.01% |
-43.41% |
| EPS |
-0.09 |
-55.25% |
-47.35% |
Key Financial Ratios
operatingProfitMargin
-510%
operatingCashFlowPerShare
$-0.09
freeCashFlowPerShare
$-0.1
Management Commentary
Technology and Growth Initiatives: Rigetti's CEO, Subodh Kulkarni, emphasized that achieving 99% median 2-qubit gate fidelity is pivotal for the company's roadmap, contributing to practical quantum computing applications. This advancement could serve as a catalyst for growth in 2024.\nMarket Positioning: Kulkarni noted the competitive edge Rigetti has gained with government contracts from the DOE and DOD labs, solidifying its credibility in the quantum computing market. This recognition from prestigious entities supports the ongoing investment and technology development.
"Our plan is to get us from 98% median 2-qubit gate fidelity to 99-plus percent median 2-qubit gate fidelity, which is a big milestone not only because it's a 2x reduction in errors, but also at 99% fidelity, you can start doing realistic error correction." - Subodh Kulkarni, CEO
— Subodh Kulkarni
"We believe building a system at the NQCC could enable even more innovative discoveries to deepen our understanding of how to improve superconducting quantum computers with the goal of solving practical problems currently intractable by classical resources alone." - Subodh Kulkarni, CEO.
— Subodh Kulkarni
Forward Guidance
Management highlighted the expectation of continued revenue growth driven by new contracts, particularly referencing the 24-qubit system being developed under a UK government grant. While they refrain from issuing formal guidance for 2024, management expressed confidence that recent contract wins and technology developments will enhance sales trajectory in the coming quarters. Key milestones include reaching targeted gate fidelity improvements and securing additional government contracts.