Rigetti is making progress, but its quantum computing systems are error-prone, and the company is burning through cash.
IBM, meanwhile, is a quantum-first company backed by its legacy business.
This is allowing IBM to attack quantum computing with two very different chips.
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Abolishes computing(NASDAQ: RGTI ) 2025 was one of the hottest quantum computing stocks, 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 aiming to introduce a 150+-qubit system with 99.7% fidelity by the end of 2026 and a 1,000+-qubit system with 99.8% fidelity by the end of 2027.
The company has also seen some commercial success. It has received two orders totaling $5.7 million for Novera quantum computing systems, which will be delivered in the first half of 2026. Meanwhile, the Air Force Research Laboratory won a three-year, $5.8 million contract to develop a superconducting quantum network in collaboration with Dutch quantum computing company QphoX. Rigetti also became one of the first companies to join Nvidia(NASDAQ: NVDA ) NVQLink platform for integrating quantum computers and artificial intelligence supercomputers.
However, Righetti was not one of the first 11 companies selected by the United States government’s Defense Advanced Research Projects Agency to proceed with the second phase of its Quantum Benchmarking Initiative. The program was established to determine whether companies are on track to build fault-tolerant quantum computers within the next decade.
One of Rigetti’s big advantages 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-reduction techniques until the hardware can reach 99.9% fidelity.
With minimal revenue and technology considered error-prone, Rigetti is a highly speculative stock with many risks. However, there is a less risky way to play the field.
Image source: Motley Fool.
While IBM(NYSE: IBM) Known as a legacy tech company, it is actually transforming itself into a quantum-computing-first company. It also dumped its low-gross-margin information technology infrastructure services business, spinning it off Fire extinguisher In 2021. Notably, it’s not dabbling in quantum computing as a side project. Alphabet or Microsoft.
IBM is actually attacking quantum computing on two different fronts. With its new 120-qubit Nighthawk chip, it’s prioritizing quality over quantity. The company redesigned its chip layout to increase connectivity, which helps it gain a quantum advantage, the ability to solve real-world problems better or cheaper than today’s supercomputers. The chip can handle problems that “require 5,000 two-qubit gates,” which is an important milestone in quantum computing, as it’s the level that pushes it above today’s classical supercomputers. The company is looking to reach 10,000 gates (operations) by 2027. The Nighthawk chip IBM is looking to use with the 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 develop a fault-tolerant quantum computer that doesn’t make mistakes. This chip is more specialized than the Nighthawk and can reset the qubits while calculating without stopping. IBM is aiming for Loom to be the backbone of Starling, the world’s first large-scale error-free quantum computer, in 2029.
IBM is looking to take a page out of Nvidia’s book for how Nvidia’s CUDA software platform created a gap around its graphics processing units. IBM has created the Qiskit software platform for quantum research. While it is open source, unlike CUDA, which is proprietary, it is optimized for IBM hardware.
IBM’s core business is still growing strongly, 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.
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Geoffrey Seiler has a place in the Alphabet. The Motley Fool has positions in and recommends Alphabet, International Business Machines, IonQ, Kyndryl, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. Motley Fool has a disclosure policy.
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