Rigetti Computing (RGTI) and IonQ (IONQ) stock prices have done well this year, as investors rotate to quantum computing companies. RGTI shares soared to a high of $6.87, its highest level since June 2022, and 821% higher than the year-to-date low.
IonQ stock soared to $33, up by over 425% from the year-to-date high, pushing its market cap to over $7.12 billion. Rigetti’s market value has soared to more than $1 billion.
Why IonQ and Rigetti Computing surged
IonQ and Rigetti Computing stocks have been in a strong bullish trend in the past few months as investors embraced companies in the quantum computing space.
For starters, quantum computing is a cutting-edge technology that aims to be the next big thing in the computing industry.
Its technology differs from the current era of computers, which process information in binary bits like 0s and 1s. These computers use qubits, which can exist in multiple states and perform simultaneous tasks faster.
Today’s computers, such as those made by Apple and Dell, are highly advanced and can do more work than those that existed a decade ago. Quantum computers handle solutions faster and can solve some of the most complex problems faster.
The impact is that these computers can be used in some of the most advanced areas like drug discovery, aviation, and artificial intelligence.
Therefore, the IonQ and Rigetti Computing stocks surged after Google unveiled Willow, its quantum computing chip. In a statement, the company said that the chip had solved a complex calculation in less than five minutes. Today’s fastest supercomputers would take 10 septillion years to solve it.
Most importantly, the Willow chip has solved the error problem that is common in quantum computing. In its case, the more qubits are used in Willow, the more it reduces errors.
Therefore, IonQ and Rigetti stocks surged as investors anticipated more growth in the industry in the next few years.
Rigetti Computing and IonQ are doing well
IONQ and RGTI are still tiny companies that are losing millions of dollars each quarter. The most recent results showed that IONQ’s revenue stood at $12.4 million, a 102% annualized growth. It expects that its annual revenue would be between $38.5 million and $42.5 million.
IONQ sees its business continuing to grow in the coming years. For example, it secured bookings of $63.5 million in the third quarter, including big one of $54.5 million from the Air Force Research Lab.
The challenge, however, is that it is still losing millions of dollars and its path towards profitability will be long. It had a net loss of $52.4 million in the last quarter and $129 million in the first nine months of the year.]
Rigetti Computing, on the other hand, is not doing relatively well. Its quarterly revenue stood at about $2.37 million from $3.1 million in the same period last year. Its nine-month revenue dropped to $8.5 million.
The other challenge is that the IONQ and Rigetti stock prices is that they have become highly overbought and overvalued.
Therefore, there is a likelihood that the stock will retreat in the next few months as the momentum fades. If this happens, the IONQ stock will drop to $21.5, the highest point in September last year. Rigetti stock may drop to $3.4, down by about 46% from the current level.
Read more: IonQ stock has soared: could it soar by 62% to retest $36?
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