Quantum Computing...in Space!

In this podcast, Motley Fool analyst Emily Flippen and contributors Jason Hall and Keith Speights:

• Break down CoreWeave's latest results, including booming backlog, heavy capex, and whether an AI infrastructure arms race can still reward shareholders.
• Compare CoreWeave's reality to "up-and-coming" quantum names like Rigetti, IonQ, D-Wave, and Quantum Computing Inc., and make the case for (or against) taking the tech-giant route with Alphabet or Microsoft instead.
• Explain why Rocket Lab's record revenue, rising margins, and growing backlog are bright spots in a bruised space sector -- and how government shutdown drama factors into the story.
• Dig into AST SpaceMobile's satellite-to-cell strategy, big-name carrier partners, ambitious launch plans, and why 2026 could be a make-or-break year for the stock.

To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. When you're ready to invest, check out this top 10 list of stocks to buy.

A full transcript is below.

This podcast was recorded on Nov.11, 2025.

Emily Flippen: We're using quantum computing and AI to blast off into space as we digest earnings today on Motley Fool Money. It's Tuesday, November 11th. Welcome to Motley Fool Money. I'm your host Emily Flippen and today, I'm joined by Fool analysts Jason Hall and Keith Speights to discuss two trendy topics quantum computing and space travel. Well, really, we'll be digging into earnings for three companies that are trying to make one or both of those things a reality. We'll get to our two space and space adjacent businesses, Rocket Lab, and AST SpaceMobile later in the show. But, Jason, I really want to start with CoreWeave today. Now, CoreWeave isn't directly a quantum computing stock.

Jason Hall: They're not in space either.

Emily Flippen: They're not in space, fair enough. They sell in the GPUX that's not quantum processing units, but they do sometimes get lumped into that space because of their close connection with NVIDIA, and they do have that hypergrowth AI centered business. I understand why people lump them together. Shares are down nearly 15% today, despite the fact that they saw yet another continuation of a booming top line. Are you excited about CoreWeave at least more than the market seems to be today?

Jason Hall: I don't want to say I'm excited, but I see what's exciting about the business, and I also understand why the stock is coming down. It has gone on a bit of a parabolic run since it went public. The debut price, it was up trading the first day after the stock debuted. It's more than doubled. It's come down over the past few months. But there's still a tremendously rich valuation based on the expectations. Even with the sell off, that's important to remember. Here's the core for those who haven't followed CoreWeave, it's built up some really strong IP that it says makes its data centers better and more efficient for AI developers. It's a who's who in AI and cloud computing. It has this almost $60 billion backlog. Fifty billion of that is contracted remaining performance obligation or RPO. Growth rates are certainly astronomical if we can keep that theme going. They're likely to remain exceptionally high for some time to come. There are also some signs that its scale up is driving improvements. If we look at its financial results, adjusted EBITDA, adjusted operating income and its margins. They did improve in the quarter. Adjusted losses fell and I think this is a business that is likely to be a lot larger in five years. But even with those improvements and the growth, it's far less clear how much of that growth is going to flow through to investors. This isn't a software company. It's an infrastructure business with a technology overlay, and building all of the data centers that it needs to meet demand is coming at a massive cost. We're going to see a lot of that cost to the balance sheet. Just for some context, we got the updated full year guidance. Actually, one of the reasons the stock is down is the guidance was a little bit lighter for the fourth quarter in the full year than investors were expecting. But management's calling for about $5 billion in revenue for the full year. That's more than double last year, but it's going to spend $13 billion on CapEx projects and it's going to pay about $1.4 billion in interest expense. So 25% of its revenue is going to go right back out the door just to service debt. At the same time, it's been really acquisitive. Since it went public this spring, it's already announced four acquisitions. That's a lot of money flowing out the door that investors need to see, deliver both continued growth and also help defend margins. Here's the thing, the CapEx that we're going to see this year, it's going to have to fund a lot more. The thing is the way the business works, you have to fund the CapEx before the data centers generate revenue. Probably over time, the math should start becoming less unfavorable. But the risk here is we see this ravenous appetite for new AI infrastructure. If that becomes seeded, the momentum stops before CoreWeave gets its business to scale. Now the other part, too is, let's be honest, motes are ephemeral, if existing at all in technology. CoreWeave's technical advantages today are helping it win big sales, but can it maintain them in the next contract cycle with its customers? If not, it's going to be impossible to have any pricing power in what ultimately I think is going to be a commodity, and that's just selling compute cycles if you can't show customers a reason to pay up.

Emily Flippen: A hot take there, Jason. Motes are ephemeral. Keith, do you agree? There's no real mote here for CoreWeave?

Keith Speights: I actually do agree with what Jason said. I will say this, though. The company posted really phenomenal Q3 results. The numbers look great, but as Jason mentioned, the guidance was a little lower than expected, and that's what has caused this stock to sell off. But I think it's important to dig into a little bit of why that happened, why that guidance wasn't quite as high as what analysts were looking for. One of the main reasons was that CoreWeave, one of their third party data center developers was simply running behind on a major project, so they weren't able to recognize the revenue like they wanted to. But I do think this underscores something investors need to be aware of with this stock. CoreWeave's fortunes hinge on several things over which the company simply doesn't have much control, including the contractors it uses, power availability. Right now, that's not a big issue for the company. But down the road, that could become a huge issue, just the availability of getting power to run these data centers.

Emily Flippen: Well, if it's a big issue for CoreWeave, it's definitely a big issue for a company that we're also going to be talking about today, Keith, and that's perhaps the most well known quantum computing stock that also reported yesterday evening that shares of Rigetti computing. They were down mildly after mixed results, and it seems like both CoreWeave and quantum stocks get a bad wrap. Does this quarter prove that it's well earned or are those opportunities here yet for prudent investors?

Keith Speights: Well, Emily, you're exactly right. Rigetti is definitely among the most widely followed up and coming quantum computing stocks, but up and coming often means not there yet. That's the case with Rigetti, but not so much with CoreWeave. Rigetti reported Q3 revenue of only get this $1.9 million. That's pocket change for CoreWeave. CoreWeave spent a whopping $1.9 billion on CapEx alone in Q3. Also, Rigetti's revenue declined around 18% year over year in its latest quarter, that's not great. Meanwhile, CoreWeave's revenue nearly doubled. These companies are very different. But to be fair, quantum computing is in a much earlier stage than AI hyper scaling. Rigetti has some great potential, especially if it can deliver on its goals to deliver 150 plus cubit quantum computer near the end of next year and a 1,000 plus cubit system by the end of 2027. But it's important to remember there are other quantum computing companies out there that have ambitious plans, too. IonQ, D-Wave Quantum, the ticker there is QBTS and Quantum Computing Incorporated, a very aptly name, by the way, ticker there QUBT. Those are three other smaller players that are making waves.

Jason Hall: The thing that I keep coming back to is that the first semiconductor came out of a Bell Labs laboratory back in the 1940s. How early are we on quantum? Is it going to be one of these working out of a garage start-ups, all are Apple or HP, that's really going to be the winner? We have some real whales in the tech ocean, like Alphabet and IBM, and even NVIDIA, that's made its share of seen investments in quantum computing. Is that where investors should really be looking?

Keith Speights: Jason, you make a great point. I think it's possible that any of the stocks I've mentioned, Rigetti, IonQ, D-Wave and Quantum Computing Incorporated, they could be big winners if their quantum computing efforts pay off. But the least risky way to invest in quantum computing, in my opinion, anyway, is to buy shares of one of those tech giants that have major quantum computing initiatives going on. Alphabet, with its Google Quantum AI unit is a great pick. Microsoft is a great pick, I think. These are the stocks I think that investors who aren't huge risk takers, but they want to potentially profit from this quantum computing boom should really take a hard look at.

Emily Flippen: It goes back to one of David Gardner's core aspects of Rule Breaker Investing. That's to invest in the top dog and first mover in an important emerging industry. It's not just the first mover. It's the top dog, as well so oftentimes in these important and emerging industries, you have companies that are first to the scene, but they're not the companies that end up being the lasting top dog, so to speak. It's important to get both. Up next, we're picking a part of space stock that's hitting a speed bomb due to the government shutdown. Stick with us.

Welcome back to Motley Fool Money. Keith, now, I can't speak for you, but when I hear about space stocks, I actually cringe a little bit. See, I'm a little bit of a space nerd, not really in any technical sense, but in the sense that if someone offered to send me to space and I could never return, I would actually take them up on it. Also, in the sense that I perhaps bought Virgin Galactic when it went public, and I'm still sitting on 99% losses in that investment. When I hear that Rocket Lab, which is a company looking to master satellites and payload launches is up a bit after really stellar third quarter earnings reports, I still cannot motivate myself to get excited. Why should I be giving this industry a second chance?

Keith Speights: First of all, Emily, I'll say, you're more adventurous than I am. I would be willing to go up into space, but I want to come back so we're good.

Emily Flippen: Fair enough.

Keith Speights: Hey, but Rocket Lab seems to be a great example of how one niche within an industry can be successful while other parts of the industry struggle. Instead of focusing on getting humans into space, as say, Virgin Galactic does, Rocket Lab specializes in, as you mentioned, getting satellites and other payloads into space. That's turning out to be a really smart move. The numbers speak for themselves with Rocket Lab. The company reported record revenue in Q3 of $155 million. That was up around 48% year over year. Now, Rocket Lab is still unprofitable, but its bottom line is improving. It improved significantly from the prior year period. The other thing is the company's gross margin is looking better. Rocket Lab's reported a gross margin of 37% in Q3. That was a record high for the company. I think the main reason to get excited about Rocket Lab is that its prospects are significantly looking up. No pun intended there. The company's backlog is at an all time high. They have 49 launches under contract. What's especially noteworthy to me is that over one third of those deals, 17 of them were signed in the third quarter alone.

Jason Hall: That's right and a lot of the opportunities in space are increasingly from private companies. But the US federal government and other governments are still big players and big spenders here. I think increasingly we may see that with more partnerships with private companies. What's going on there for Rocket Lab?

Keith Speights: Jason, you and Emily and I talked on the podcast just a couple of weeks ago about the impact of the federal government shutdown. Rocket Lab has definitely been affected by this ordeal. For example, awards for around 54 of the space development agency's Tranche 3 tracking layer have been delayed by the government shutdown, and that Tranche 3 tracking layer, by the way, is a constellation of satellites that are designed to track and provide warning about missile threats. On a similar note, Rocket Lab could be a potential winner when contracts are awarded for the Golden Dome missile defense system.

Jason Hall: Rocket Lab has also made some progress beyond just its electron small launch system. That's the bulk of its business right now. The HASTE hypersonic platform has also launched multiple missions, and I think the next big thing that's so exciting to me is they just opened up their test site for neutron. That's the reusable medium lift platform. They say they're still on track to deliver and launch the first neutron early next year, and that's starting to push into an area that SpaceX has really dominated so far.

Emily Flippen: That all sounds interesting, guys, but I'll circle back when they offer to send me to space. Coming up next, we're evaluating if AST SpaceMobile is right that you don't necessarily need to send people to space to be a winning space stock. Stick with us.

Welcome back to Motley Fool Money. As the wrap up today's show, let's discuss a lesser known space stock that is AST SpaceMobile. Now, I think I understand why AST SpaceMobile is more thinly traded, despite its size. They're really not doing the flashy thing of space launches, but they are still building a satellite based cellular network, which for some of the people living more remote areas probably think is pretty cool. Jason, when investors think of satellite cell networks, they probably think of stuff like Starlink. But after earnings last night, it seems that SpaceMobile is doing something pretty unique here. Why should this be on somebody's watch list?

Jason Hall: Starlink is doing a little bit of the same thing with SpaceMobile, but SpaceMobile is really focused on being a partner for existing terrestrial mobile network operators, MNOs versus what we've seen from Starlink with a lot of the proprietary handsets and other equipment at end of the quarter with 50 cell provider partners globally. Now, the sheer distance between the satellite and the user mean it's not going to work for every need. There's still going to be some latency. They've developed some technology to help address that, and they're working really hard to build a differentiated business offering. They can help cell service providers provide better coverage and potentially with a lot less of these stand-alone terrestrial cell nodes that they need for 5G. It's starting to get to an inflection point. We're seeing that shift from build-out to commercialization kick in. Now, it only reported just under 15 million in revenue in the third quarter, but it landed $1 billion in contracted revenue commitments. That's a big step toward bringing money in the door.

Emily Flippen: Keith, AST SpaceMobile's deal with Verizon announced last month provided a major catalyst for the stock, but is that just the latest in a string of contracts for the company?

Keith Speights: You're exactly right. The Verizon contract was huge for AST. But, Emily, if you look at a map of the world, this company has deals with telecommunications companies nearly everywhere. The notable exceptions are Russia and China, but pretty much everywhere else on the face of the Earth, AST has deals. The list of AST SpaceMobile's partners is impressive. In addition to Verizon in the US, AST has teamed up with AT&T. Internationally, there's Spanish telecom giant Telefonica, Vodafone, which serves Europe, Africa, and Asia. There's the African mobile network operator Africell, Japan's Rakuten Mobile, Saudi Arabian telecom company, STC. That's just the tip of the iceberg. In total, AST has over 50 mobile network partners. With a combined subscriber base almost three billion.

Jason Hall: That's the thing that I think is the most compelling to me is that while a lot of other companies are doing the hard stuff of getting stuff into space, they just want to get cell signals into space and back. They want to be able to address a real pain point that cell providers are dealing with. Those customers are going to need a lot more capacity. Going forward, the company expects to launch a satellite every 1-2 months and by the end of next year, have between 45 and 60 satellites deployed. Good news is it has the resources to keep that going with over $3 billion in liquidity, and talks about the growing cash flows that are starting to accelerate to pay for it. About 15 million in revenue last quarter. They think they're going to finish the fourth quarter with maybe as much as 75 million in revenue in the second half of the year. We're starting to see some build, and they have to ramp those revenue quickly. The company spent a $100 million in operating expenses last quarter. I don't want to call 2026 a make or break year, but in some ways, it may be.

Emily Flippen: Well, I fully came into this podcast with quantum stocks and space stocks, and CoreWeave fully expecting to just be ready to dismiss out of pocket the stocks we're talking about. I will say, though, with SpaceMobile, that is one that I'm looking forward to digging into a bit more because I really think there might be a there there, even with 2026 to your words, Jason, potentially being a mega break year. Keith and Jason, thank you both so much for joining today.

Jason Hall: Thanks, Emily.

Keith Speights: Thanks, Emily.

Emily Flippen: As always, people in the program may have interest in the stocks they talk about and the Motley Fool may have formal recommendations for or against. Don't buy or sell stocks based solely on what you hear. All personal finance content follows the Motley Fool editorial standards, and it's not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. To see our full advertising disclosure, please check out our show notes. For Jason Hall, Keith Speights and the entire Motley Fool Money team, I'm Emily Flippen. We'll see you tomorrow.

Emily Flippen, CFA has no position in any of the stocks mentioned. Jason Hall has positions in Nvidia. Keith Speights has positions in Alphabet, Apple, Microsoft, and Verizon Communications. The Motley Fool has positions in and recommends Alphabet, Apple, International Business Machines, IonQ, Microsoft, Nvidia, and Rocket Lab. The Motley Fool recommends Helmerich & Payne and Verizon Communications and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.