Is Rigetti the Next NVIDIA, and Should You Buy the Stock?

The biggest beneficiary of the artificial intelligence (AI) boom is NVIDIA Corporation NVDA, with its shares increasing by 54.5% over the past year. It is the leading manufacturer of graphic processing units (GPUs) worldwide. However, its gains are far surpassed by Rigetti Computing, Inc.’s RGTI 1147.6% increase during the same period.  Yes, the quantum computing company has experienced some volatility this year, but overall, investors remain optimistic about the stock since quantum processing units (QPUs) can process data much faster than GPUs and could potentially be the next major advancement in technology. So, can Rigetti achieve similar success to NVIDIA in the future, and is it a worthwhile investment? Let’s find out –  Reasons to Be Bullish on Rigetti Stock Rigetti offers both modular and non-modular QPUs for sale. For developing quantum applications, Rigetti provides cloud-based platforms and designs its own quantum systems. This strategy of diversifying assists the company in minimizing risks. Rigetti has made significant progress in quantum computing and released its first QPUs for commercial use in 2023. Recently, the company introduced the 84-qubit Ankaa 3 quantum system for government, and for commercial clients, it launched the 9-qubit QPU. Likewise, Rigetti will launch a 36-qubit system this time and a non-modular 100-qubit system in 2026. Currently, it is collaborating with NVIDIA to develop a hybrid system combining QPU and GPU technologies to improve AI task processing efficiency.  Rigetti also offers more flexible on-site deployment options and pricing structures, giving it an advantage over larger competitors like International Business Machines Corporation IBM. As a result, many market analysts expect Rigetti’s revenues to grow in the future with the rollout of its new systems.  Rigetti envisions a substantial long-term market for quantum computing. Boston Consulting Group estimates the market to be worth between $90 billion and $170 billion, while McKinsey projects it could reach $198 billion by that time. Could Rigetti Be the Next NVIDIA? Should I Invest Now?Despite Rigetti showcasing significant growth potential and staying ahead of its competitors, the practical use of quantum computing remains years away, leading to heightened risks and constraining RGTI’s potential for advancement. Hence, it’s premature to conclude that Rigetti will be able to mimic NVIDIA’s success.  NVIDIA, on the other hand, has reclaimed the top spot as the most valuable company, driven by increased demand for AI. The company’s first-quarter fiscal 2026 revenues of $44.1 billion topped expectations, and are anticipated to see further growth as the demand for Blackwell chips and CUDA software continues to be robust (read more: D-Wave Quantum or NVIDIA: Which Stock Is a Better Buy Now?).  So, how to trade Rigetti stock now? The utilization of QPUs in AI applications will eventually benefit Rigetti, prompting stakeholders to hold on to their shares. New investors, however, may invest in Rigetti at their peril. This is because Rigetti’s revenues are shrinking, operating expenses have gone up, and competition is tough from bigger tech players.  Rigetti’s first-quarter revenues came in at $1.5 million, down 52.5% year over year. Higher R&D expenditures drove operating costs in the quarter to $22.1 million, up 22% year over year. Rigetti is currently using up cash resources during a period when other companies, such as Alphabet Inc. GOOGL and Amazon.com, Inc. AMZN, are investing heavily in quantum computing.  Rigetti’s sky-high valuation in a nascent quantum computing market is also very hard to comprehend. Its forward price-to-sales (P/S) ratio is 527.41, whereas the Internet - Software industry’s is 6.32. Image Source: Zacks Investment ResearchFor now, Rigetti has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Amazon.com, Inc. (AMZN): Free Stock Analysis Report International Business Machines Corporation (IBM): Free Stock Analysis Report NVIDIA Corporation (NVDA): Free Stock Analysis Report Alphabet Inc. (GOOGL): Free Stock Analysis Report Rigetti Computing, Inc. (RGTI): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks