Rigetti Computing, Inc., a quantum computing company, has received a notification from Nasdaq on Monday, indicating non-compliance with the exchange's minimum bid price requirement. The company's stock has closed below the $1.00 minimum bid price for 31 consecutive business days, violating Nasdaq's Listing Rule 5550(a)(2).
Nasdaq's notice provides Rigetti with a 180-day period, until March 17, 2025, to regain compliance. The company must maintain a closing bid price of at least $1.00 for ten consecutive business days within this timeframe to meet the standard. If Rigetti fails to comply by the deadline, it may qualify for an additional 180-day grace period, provided it meets other market standards and notifies Nasdaq of its intent to correct the bid price deficiency, potentially through a reverse stock split.
The possibility of a reverse stock split was authorized by Rigetti's stockholders at the Annual Meeting on June 18, 2024, allowing a 1-for-10 ratio change without further stockholder approval. The company's board retains the discretion to enact this amendment.
Rigetti has expressed its intention to monitor its stock price closely and explore options to regain compliance with Nasdaq's requirements. However, there is no assurance that the company will achieve compliance or maintain its listing on the Nasdaq Capital Market.
This development follows the company's previous identity as Supernova Partners Acquisition Co II, Ltd. before changing its name on December 30, 2020. The information reported is based on a press release statement and reflects forward-looking statements subject to various risks and uncertainties. These include the risk of unsuccessful compliance efforts and the potential need for further stockholder approval for a reverse stock split if the current authorization expires.
Rigetti's plans to address the non-compliance issue involve potential strategic actions that may include a reverse stock split, but the board has not yet decided on this course of action. The company's compliance with Nasdaq's Listing Rule 5550(a)(2) is crucial for its continued listing and trading on the exchange.
In other recent news, Rigetti Computing has reported a combination of financial results and technological advancements. The company announced its Q2 2024 revenues were $3.1 million, a slight decrease from $3.3 million in Q2 2023. Despite a drop in gross margins from 82% to 64%, the net loss improved to $12.4 million in Q2 2024 from $17 million in Q2 2023.
Rigetti's innovative strides include the development of a new chip fabrication technique, Alternating-Bias Assisted Annealing (ABAA), which enhances the precision of qubit frequency targeting. This is expected to improve the execution of 2-qubit gates and reduce defects in quantum processors.
The company also announced plans for the 84-qubit Ankaa-3 system, expected to be deployed by the end of 2024. This aligns with Rigetti's ongoing efforts to scale up to higher qubit count systems, as emphasized by CEO Dr. Subodh Kulkarni.
InvestingPro Insights
In light of Rigetti Computing's recent challenges with Nasdaq's minimum bid price requirement, examining the company's financial health and stock performance can provide additional context for investors. According to InvestingPro data, Rigetti holds a market cap of $157.13 million and a Price/Book ratio for the last twelve months as of Q2 2024 at 1.32, which offers insight into how the market values the company's net assets. Despite a notable gross profit margin of 65.59% during the same period, the company's revenue has declined by 12.31%, indicating potential challenges in growth.
InvestingPro Tips highlight that Rigetti is currently not paying dividends to shareholders and is not expected to be profitable this year. Additionally, the company's stock price has experienced significant volatility, with a substantial return of 12.0% over the last week, yet it has fallen by 55.83% over the past year. These metrics underscore the uncertainty surrounding Rigetti's financial stability and stock performance.
For investors seeking a deeper dive into Rigetti's financials and stock analysis, InvestingPro offers a wealth of additional tips, including insights into cash flow and liquidity. There are 10 more InvestingPro Tips available for Rigetti, which can be explored at https://www.investing.com/pro/RGTI.
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