D-Wave Quantum and Rigetti Computing have established themselves as early movers in a disruptive opportunity.
As the generative artificial intelligence (AI) hype cycle gets long in the tooth, investors are on the lookout for the next big technology. Quantum computing might be it. Shares in the early movers have soared over the last few months as the market starts pivoting to this long-term opportunity.
Let’s discuss why D-Wave Quantum (QBTS -5.84%) and Rigetti Computing (RGTI -6.65%) could be poised to soar in 2026 and beyond, despite their extreme fundamental challenges.
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1. D-Wave Quantum
With shares up by over 3,700% in the last 12 months, D-Wave Quantum has already made plenty of millionaires out of its early backers. The California-based company is riding a wave of optimism because of the growing sales of its advanced quantum annealing devices.
Quantum annealing is a branch of quantum mechanics that focuses on finding the most efficient way to solve problems. While this is different from general-purpose quantum computing, it could be ideal for use cases like logistics, where companies will need to make many stops while minimizing total travel distance. This is called the “traveling salesman problem,” and it’s much more challenging than you might expect.
D-Wave’s second-quarter revenue jumped 42% year over year to $3.1 million, driven by sales of its quantum annealing devices. Earlier in the year, the company reported that its technology is already being used in real commercial applications, such as improving efficiency in vehicle manufacturing in Turkey and assisting in drug discovery in Japan.
But while D-Wave is moving in the right direction, there is still a long way to go. Second-quarter operating losses stood at a whopping $26.5 million, and profitability looks very far away. The stock is also quite expensive, with a price-to-sales (P/S) multiple of 336, so investors may want to wait for a pullback before considering a long-term position.
2. Rigetti Computing
A rising tide tends to lift all boats. And Rigetti Computing is another pure-play quantum stock enjoying a rocket ship rally. Shares have jumped 5,700% over the last 12 months, absolutely trouncing the S&P 500 average return of just 18%. Investors are optimistic about the company’s growing quantum hardware sales and compelling business strategy.
In late September, Rigetti announced purchase orders for two quantum computing systems, totaling $5.7 million (delivery expected in the first half of 2026). And the company is quickly making a name for itself with research institutions that want to experiment with this technology.
Instead of monetizing quantum technology directly, Rigetti aims to provide the hardware (chips and processors) that other companies need to develop consumer-facing platforms — much like the role Nvidia currently plays in the generative AI industry. The picks-and-shovels business model has the advantage of reducing risk in a booming but incredibly uncertain long-term opportunity.
However, while Rigetti is quickly establishing a niche for itself, it remains highly speculative. Second-quarter revenue declined 42% to $1.8 million, and the company’s operating loss of $19.9 million means profitability is nowhere in sight. Like with D-Wave Quantum, investors may want to wait for a pullback before considering a long-term position in the stock.
Quantum is still a highly speculative industry
D-Wave Quantum and Rigetti Computing look poised to soar as quantum computing nears commercial viability. But we have no idea when (or even if) this technology will be ready for primetime. It could take from years to decades. Meanwhile, both companies continue to suffer from extreme cash burn and overvaluation because of their low sales figures.
While D-Wave and Rigetti Computing are strong picks within the quantum industry, investors should be prepared for choppy performance and extreme volatility. Remember, these are highly speculative stocks that only make sense as small positions within a broader diversified portfolio.
Will Ebiefung has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.
