IonQ (IONQ 0.15%) and Rigetti Computing (RGTI +0.59%) are two of the most popular quantum computing investment options available on the market. Both companies are racing toward providing a commercially viable quantum computer -- a market that McKinsey & Company believes could be worth up to $72 billion annually by 2035.
That's a huge market that doesn't exist right now, and picking the right stock could make investors a ton of money, while choosing the wrong one could lead to a position going to $0.
So, which one is the better stock pick? Let's take a look.
Image source: The Motley Fool.
IonQ and Rigetti are approaching quantum computing from two different perspectives
There is no established way to do quantum computing because it's an emerging technology. IonQ and Rigetti each use different techniques, and both have their advantages. IonQ uses a trapped-ion approach, which yields better computing accuracy than other approaches. Rigetti Computing utilizes superconducting, which yields faster processing speeds.
NASDAQ: RGTI
Key Data Points
The current roadblock to widespread quantum computing usage is the accuracy of quantum computing platforms, so backing a company like IonQ over Rigetti makes sense right now. However, should Rigetti close the accuracy gap, then its faster processing speeds will become a reason to invest in the stock.
Another factor to consider is what other competitors are doing. Some of the largest tech companies in the world are also using a superconducting approach, and they have a lot more resources than Rigetti. So, Rigetti may not even be the best stock pick in its respective technological approach. This potential issue is showing up in its financials as well.
During the fourth quarter, Rigetti recognized revenue of $1.9 million, with an operating loss of $22.6 million. IonQ's revenue was far more impressive, with $61.9 million in revenue, but it posted a massive operating loss of $229 million.
NYSE: IONQ
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However, with IonQ's leadership position in the quantum computing realm, countless investors are willing to step in to continue funding IonQ's operations, where Rigetti may have a more difficult time. This may be the difference in surviving the early stages, making IonQ a far safer pick as well.
I think IonQ is currently the much better investment pick between the two, but if Rigetti has a few breakthroughs, it could come roaring back. I need to see a bit more progress from Rigetti before I'm willing to give it the benefit of the doubt, which is why I'm far more bullish on IonQ's stock right now.
