Rigetti (RGTI) Q2 2026 Earnings: Government Was 92% Of Revenue, Now It Is 18%

Rigetti Computing (RGTI) Q2 2026 — Q2 2026 (quarter ended June 30, 2026): revenue $5.138M vs a $5.087M bar - a beat, UP 185% y/y. Gross margin 42.6% vs 31.4%. But non-GAAP diluted loss per share was $0.05 against a $0.046 bar - a MISS. GAAP diluted loss per share $0.16. The 8-K was accepted 4:05pm ET Thu Aug 6, AFTER the close, so FRIDAY Aug 7 is the reaction: RGTI closed $17.94, UP 8.5% from $16.53. Rigetti missed on earnings and the stock rose 8.5%. The reason is in Note 11 of the 10-Q, page 23: sales to government entities were 91.7% of revenue in Q2 2025 and 18.0% in Q2 2026. Eighty-two percent of this quarter came from non-government customers, at a 42.6% gross margin after two quarters of NEGATIVE gross profit. The same footnote takes most of it back: Customer A was 64% of the quarter. THE CALL: AVOID (4/5, THE COMPANY IMPROVED. THE PRICE DID NOT) — base-case value ~$4.25 vs ~$17.94 today. KEY METRICS: - CALL: AVOID 4/5, fair value $4.25 vs the $17.94 close on Fri Aug 7 (-76.3%). Scenario model, 10% over 10 years: wins the platform 18% = $16.68, real but subscale 27% = $1.45, research shop 33% = $0.36, wound down 22% = $0.37. Weighted $3.59 plus $0.66 optionality. Bull $22, net-cash floor $1.62. Street: BUY, 6 buy / 1 hold, target $26.25 ($18-$40), per FMP. - THE PRINT + THE BRIDGE: revenue $5.138M (+185%) beat $5.087M; non-GAAP LPS $0.05 MISSED $0.046; GAAP LPS $0.16, net loss $52.6M. R&D $20.728M, SG&A $9.522M, operating loss $28.062M (+41%). GAAP $52.606M less the $29.602M warrant mark less $7.020M of Q2 stock comp = $15.984M - the printed $16.0M non-GAAP loss. It reconciles to the dollar. - THE ANGLE (10-Q Note 11, p.23): government revenue 18.0% of sales vs 91.7% a year ago. But Customer A was 64% of the quarter and Customer C 16%. The Street models Q3 revenue at $3.679M, 28% BELOW this print. THE FACTORY: Q2 capex $11.993M = 2.3x revenue, plus $10.118M of equipment still UNPAID inside accounts payable; payables went $3.488M to $14.001M. - BALANCE SHEET + THE CLOCK: $541.3M of cash and investments, NO DEBT, 333.8M shares, EV $5.45B on $13.4M trailing revenue = 408x sales. 8,436,597 warrants at $11.50 expire 2 March 2027; the $78.407M liability is 71% of all liabilities and was moved to CURRENT. Redemption needs an $18.00 close - Friday was $17.94. That is $97.0M. H1 ATM: $0; 2025 ATM averaged $11.44. - THE REVERSE TEST: at 10% over 10 years on ~520M shares, $17.94 needs ~$24B of 2036 equity value - at 30x earnings and a 25% margin that is $3.2B of revenue, 242x trailing, a 73% CAGR for a decade. Our BULL case at 100% certainty is $16.68 - BELOW the price. Revenue fell four straight years to 2025. 99.1% two-qubit fidelity at 108 qubits. What to watch: UP: government revenue fell from 91.7% of sales to 18.0% while revenue rose 185%. Gross margin 31.4% to 42.6%. $541.3M of cash, NO DEBT, ~5 years of runway, and ZERO ATM shares sold in H1. DOWN: 408x sales, one customer at 64% of the quarter, the Street's own Q3 estimate 28% lower, and capex at 2.3x revenue. Also on YouTube: @ChargedAlpha DISCLAIMER: For informational and educational purposes only. Not financial advice. Do your own research before any investment decision.