Rigetti Computing (RGTI 3.41%) was one of the hottest quantum computing stocks in 2025, as the company hit some important hardware milestones this year. This included demonstrating the industry's largest multichip quantum computer and introducing a 100+-qubit chiplet system with 99.5% fidelity (a measure of accuracy in quantum computing). Rigetti is looking to introduce a 150+-qubit system with 99.7% fidelity around the end of 2026 and a 1,000+-qubit system with 99.8% fidelity around the end of 2027.
NASDAQ: RGTI
Key Data Points
The company also saw some commercial success. It received two orders totaling $5.7 million for its Novera quantum computing systems, which it will deliver in the first half of 2026. Meanwhile, it was awarded a three-year $5.8 million contract by the Air Force Research Laboratory to develop a superconducting quantum network in collaboration with Dutch quantum computing company QphoX. Rigetti also became one of the first companies to join the Nvidia (NVDA +1.13%) NVQLink platform for integrating quantum computers and artificial intelligence supercomputers.
However, Rigetti did experience a setback when it was not one of the first 11 companies selected by the United States government's Defense Advanced Research Projects Agency to advance to the second phase of its Quantum Benchmarking Initiative. The program was established to determine whether companies are on the right path to building a fault-tolerant quantum computer within the next decade.
Rigetti's one big advantage is that its superconducting qubits are fast, estimated to be 10,000 times faster than those used by IonQ. However, when it comes to quantum computing, 99.5% fidelity is considered extremely error-prone. In fact, data scientists don't recommend introducing other error-reducing techniques until hardware can reach 99.9% fidelity.
With minimal revenue and a technology that is considered error-prone, Rigetti is a highly speculative stock with a lot of risks. However, there is a less risky way to play the sector.
Image source: The Motley Fool.
IBM
NYSE: IBM
Key Data Points
While IBM (IBM 1.24%) is known as a legacy tech company, it has actually been transforming itself into a quantum-computing-first company. It also dumped its low-gross-margin information technology infrastructure service business, spinning it off into Kyndryl in 2021. Notably, it's also not dabbling in quantum computing as a side project like Alphabet or Microsoft.
IBM is actually attacking quantum computing on two different fronts. With its new 120-qubit Nighthawk chip, it is prioritizing quality over quantity. The company redesigned its chip layout to increase connections, which it expects will help achieve quantum advantage, the ability to solve actual problems better or more cheaply than today's supercomputers. The chip can handle problems that "require up to 5,000 two-qubit gates," which is an important milestone in quantum computing, as this is the level that pushes it above today's classical supercomputers. The company is looking to reach 10,000 gates (operations) by 2027. Nighthawk is the chip IBM is looking to use with IBM Cloud to run advanced simulations in the coming years.
At the same time, IBM has also introduced a more experimental chip called Loon to help it develop a fault-tolerant quantum computer that doesn't make mistakes. This chip is more specialized than Nighthawk and can reset qubits during a calculation without stopping. IBM is looking to Loom to be the backbone of the world's first large-scale, error-free quantum computer, Starling, in 2029.
IBM is also looking to take a page out of Nvidia's book with how Nvidia's CUDA software platform formed a moat around its graphics processing units. IBM has created the Qiskit software platform for quantum research. While it's open-source, unlike CUDA, which is proprietary, it has been optimized for IBM hardware.
IBM's core business is still growing solidly, while it's generating a ton of operating cash flow that it can plow back into its quantum computing research. That makes IBM a much better risk-reward play than Rigetti, which is burning through cash.
