Rigetti Computing, Inc.

Good day and thank you for standing by. Welcome to the Rigetti Computing Second Quarter 2022 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during this session, you will need to press Start 1-1 on your telephone. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Polly Pearson with Cher Merrill Associates. Please go ahead.

Thank you, Operator, and good evening, everyone. Today, we will be reviewing Rigetti's second quarter 2022 earnings results. With me here is Chad Rigetti, founder and CEO of Rigetti Computing, and Brian Cerita, CFO. Before I turn the call over, I'd like to point out that this call and Rigetti's Q2 press release contain forward-looking statements concerning current expectations, objectives, and underlying assumptions regarding future operating results. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those described. Also, in an effort to provide useful information to investors, comments today include non-GAAP financial measures. For details on these measures and reconciliations to comparable GAAP measures and for further information regarding the factors that may affect Rigetti's future operating results, please refer to today's earnings release on Rigetti's website at

investors.regetti.com or to the 8k filed with the sec earlier today and now we'll turn it over to chad chad thank you paulie and welcome everyone to our second quarter 2022 earnings call we delivered strong results this quarter advancing on our product roadmap continuing to attract key talent and strengthening our base of customer and partner relationships Our R&D and product development teams made excellent progress and we remain on track to meet our technology roadmap targets. This includes our planned next generation 84 qubit system in 2023 and 336 qubit system later that year. Our quantum cloud services team achieved a major step forward in quantum processing speed, demonstrating a four and a half times improvement compared to the performance we reported this past February, as Rigetti continues to be a pioneer in hybrid quantum classical systems. We unveiled our first UK-based quantum computer and won two new UK government awards for projects to advance quantum computing technology and applications. And we announced our selection to lead a new DARPA program focused on developing benchmark applications for quantum computing. Over the next decade, we expect the world's most powerful computers to leverage quantum processors as accelerators in a quantum classical hybrid architecture, like the one we have pioneered at Regetti. Rigetti is working to build the core hardware and software technologies to unlock this future, and we are commercializing it in our QCAS, our Quantum Computing as a Service business model, using our Quantum Cloud Services platform. Over the years, we have carved out a distinctive position in the industry as a leading platform for delivering quantum classical computational power. Our trailblazing leadership in hybrid is no accident. We have been pursuing this vision since 2014, when we patented our hybrid coprocessor architecture for practical quantum computing. In 2018, with the release of our QCS platform, we were the first to offer access to quantum processors tightly integrated with classical computing infrastructure. By optimizing for flexibility, functionality, and low latencies, Rigetti's Superconducting Quantum Processing Units, or QPUs, are deliberately designed to integrate with classical computing systems and infrastructure. These features underpin the fast processing speeds we have been able to achieve on our platform. One metric for measuring quantum processing speed is circuit layer operations per second, or CLOPS. Originally developed and introduced by IBM, CLOPS assesses the processing speed of a quantum computer. This past February, we benchmarked our 80-qubit Aspen M1 system using CLOPS, showing that our system was 18% faster than IBM's comparable 65-qubit system at the time. Since then, we have continued to iterate and improve on these results. Recently, we reached a new milestone, with our team successfully achieving a CLOPS performance greater than 4,000 on both our 40-qubit Aspen 11 system and our 80-qubit Aspen M2 system. These results represent a 4.5 times acceleration since February. This is a big win, and I'd like to congratulate our team for their effort and success on this front. For more information about how QLOPS is calculated and important disclaimers regarding the use of QLOPS as a performance measure, please refer to our earnings release. Rigetti is also pioneering hybrid performance for real-world applications by engaging in partnerships with classical chip makers, such as Ampere. In our work with Ampere, we have made significant progress in advancing viable hybrid use cases. This includes successfully integrating Ampere's cloud-native processing platform with Rigetti's quantum systems, as well as completing the first rounds of tests for running quantum machine learning applications on the combined platform. We couple our leadership in hybrid with an emphasis on cloud delivery, which is core to our QCaaS business model. Rigetti has been delivering QPUs over the cloud since 2017. We expect cloud delivery to allow us to continue scaling adoption, achieve faster go-to-market times, and optimize for capital efficiency and strong margin profiles. Cloud delivery also allows our customers and partners to access our latest systems, choose the most suitable QPU for their business or research objectives, and obtain maximum value when beginning a new quantum initiative or application development campaign. In our view, this emphasis on building quantum processors designed for hybrid integration and co-processing paired with our cloud delivery model is the most practical approach to commercializing quantum computing. On that note, we're excited to announce plans for our inaugural Investor Day on September 16th at our FAB1 facility, the industry's first dedicated quantum fab. The theme of this event will be integrating quantum into the fabric of the cloud, and we will provide attendees with the opportunity to tour our fab facility. If you're interested in attending the event, please reach out to our investor relations team at rgti at investorrelations.com. We will also be announcing a webcast option for those unable to attend in person. Now, I'll provide more color on our technology updates for the quarter. We are very excited about our product roadmap and remain on track to meet our technology roadmap targets announced in connection with our first quarter 2022 earnings. We are making excellent progress on our 84-qubit system planned for 2023. We recently completed the design of the chip packaging and expect to begin testing chips this month. This next-generation processor will be the first to introduce a new lattice expected to bring higher connectivity and our tunable coupling technology. As development has progressed, we continue to see high 2-qubit gate fidelities around 99% on test devices, in line with the anticipated performance improvements of our 84-qubit systems. Our planned 336-qubit machine, currently expected in late 2023, will be based on four 84-qubit chips assembled together using our proprietary multi-chip technology. We introduced the multi-chip architecture beginning with our Aspen M systems and continue to advance this modular approach to enable our next generation machines. With our unique and patented multi-chip technology, We believe that we hold a very strong position relative to direct competitors and that we are well positioned to continue pioneering this critical scaling technology. For example, our engineering and R&D teams have recently completed several important milestones towards delivering our 336-qubit system. First, in Q2, we demonstrated tunable coupling between qubits on separate chips, paving the way to leverage this patent-pending technology in our next-generation multi-chip processors. second we have begun designing and producing the advanced higher density packaging for this system third we executed the first proof of concept for our next generation control system expected to be based on radio frequency system on a chip technology we believe this approach can bring greater performance increase scalability and reduce cost to our control system for the 336 cubic qpus and beyond turning to partnerships During the second quarter of 2022, we deepened existing relationships and won new deals in both the UK and US as we continue to work hand-in-hand with top organizations in pursuit of quantum advantage. During the quarter, we launched our first UK-based quantum computer, a 32-qubit machine. Backed by UK government funding, Rigetti is leading a consortium that includes Oxford Instruments, the University of Edinburgh, Phasecraft, and Standard Chartered Bank. Our goal is to advance practical quantum computing applications in the areas of machine learning, material simulation, and finance. Building on this momentum in the UK, we recently won two new Innovate UK awards through the IFCF Commercializing Quantum Technologies Challenge. Under one of these initiatives, we plan to work alongside River Lane on error correction research and development. On the other, we plan to work with Phasecraft and BT, formerly British Telecom, to build quantum algorithms and software for solving optimization and constraint satisfaction problems for the telecom industry. Back here in the U.S., we announced that Rigetti was selected by DARPA to lead a multi-year program focused on developing and evaluating benchmark applications for quantum computing. This project expands on our current work with DARPA and aims to reformulate key quantum metrics. to make those metrics testable and estimate the required quantum and classical resources needed to reach critical performance thresholds. The total award to Rigetti and his partners is worth up to $2.9 million over three years and is based on the achievements of certain milestones, of which approximately $1.5 million is subject to DARPA's exercise of an option to extend the initial 18-month term. Additionally, we are making good progress in our work with NASDAQ and are now in the process of identifying and selecting finance use cases for further development. Notably, we continue to see strong potential for quantum advantage and valuable applications in quantitative finance. Turning to our cloud platform, we onboarded our first Azure Private Preview users this quarter. We expect to announce public access to Regetti systems on Azure in the coming months. Alongside this momentum on our technology and business, we are excited to announce a committed equity facility. We believe this facility should provide financial flexibility to support our continued focus on our mission and business plan. Given the current macro environment, we believe this is both prudent and an important vote of confidence from the capital markets. With technology advancements, business progress, and the potential to add cash to our balance sheet, we are moving with focus and intention towards our mission. In conclusion, we believe Regetti remains at the forefront of industry progress, with an enduring commitment to build and operate the world's most powerful computers. During the quarter, we continued to make tremendous advances, driving forward our quantum technologies and strengthening key partnerships. As a result, we remain on track to meet our technology objectives that we laid out on our prior earnings call. With that, let's turn it over to Brian for the financials.