Rigetti Computing, Inc. (RGTI) Cash Flow Statement

The gap between net income and operating cash flow is stark, especially in quarters with large non-operating gains (e.g., 2026Q1 net income of $33.1M versus OCF of -$16.2M). Stock-based compensation of $12.9M in 2026Q2 and D&A of $5.5M are non-cash, but working capital changes have been consistently negative, suggesting cash is being consumed by operations. This implies that reported earnings are not translating into cash generation, a critical concern for a pre-revenue company.

The FCF trajectory is alarming: despite a 185% revenue surge in 2026Q2, FCF burn expanded by 390% year-over-year, driven by rising capex and operating losses. The FCF margin of -9.4% in 2026Q2 is worse than the -4.3% in 2024Q4, indicating that revenue growth is not yet covering cash costs. This suggests the company is still in a heavy investment phase, and investors should monitor whether revenue can scale to offset the burn.

The capex surge in 2026Q2 is notable, with CapEx/Revenue at 3.2%, but the absolute level is still modest relative to the company's scale. However, the 100.2% CapEx/Revenue in 2026Q1 (due to low revenue) and 173% in 2025Q1 highlight the lumpy nature of investment. This suggests that RGTI is scaling up its manufacturing or R&D facilities, which may be necessary for future growth but adds to cash burn. The depreciation of $5.5M in 2026Q2 is only a fraction of capex, implying that the asset base is growing faster than depreciation, which could pressure future margins.

The consistent negative working capital changes, especially -$6.9M in 2026Q2, suggest that RGTI is building inventory or extending receivables as it ramps up production. This is typical for hardware companies scaling up, but it exacerbates the cash burn. The positive working capital in 2024Q3 and Q4 may have been a temporary relief, but the trend has reversed, implying that cash conversion is worsening. Investors should monitor whether this is a strategic build-up or a sign of inefficiency.

The absence of capital returns is expected for a company in a growth phase, but it underscores that all available cash is being consumed by the business. With no acquisitions reported, the cash is primarily going to R&D and capex. This suggests that management is prioritizing growth over shareholder returns, which is rational but increases reliance on external funding. The lack of buybacks also means dilution from SBC is not being offset, which could pressure the stock.

The cumulative gap between net income and operating cash flow is substantial, driven by non-cash items like SBC and D&A, but also by non-operating gains and losses. For instance, 2025Q3 had a net loss of -$201M but OCF of only -$13.8M, suggesting a large non-cash write-down or impairment. This divergence implies that the company's reported losses overstate the cash drain, but the underlying cash burn is still significant. Investors should focus on cash flow as the more reliable indicator of sustainability.