Rivian (RIVN) reported better-than-expected fourth-quarter earnings after the close Thursday, as the all-electric automaker ramps up efforts to unveil its R2 model, which it said will be available in the second quarter of this year.
Rivian reported revenue of $1.286 billion for the quarter, compared with the Bloomberg consensus forecast of $1.26 billion and down about 27% year over year. Rivian attributed the revenue decline to the loss of regulatory emissions credit sales, the expiration of federal electric vehicle tax credits and lower average sales prices.
The company reported an adjusted loss per share of $0.59, compared with expectations of $0.69; and an adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) loss of $465 million, compared with expectations of $568.2 million.
Rivian shares soared more than 18% in pre-market trading on Friday.
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Crucially, the company said it is targeting customer deliveries of its upcoming R2 midsize car in the second quarter, after an early manufacturing verification version rolled off the assembly line in January.
CEO RJ Scaringe said in an interview with Yahoo Finance: “This is a very critical turning point for us. We will demonstrate the long-term profitability of the business through R2, which is a very important plan for us to expand the scale of our business.”
The company posted a gross profit of $120 million for the second consecutive quarter, with its automotive business losing $59 million and its software and services business making $179 million. Rivian said software and services profit growth was driven by “vehicle architecture and software development services” provided by its joint venture with Volkswagen AG (VOW3.DE).
Rivian R2 is equipped with the latest hardware and Rivian’s Autonomy Platform software. ·Rivian
For the year, Rivian’s adjusted EBITDA loss was $2.063 billion, higher than the $1.8 billion expected but within the company’s forecast range. Capital spending this year reached $1.71 billion, compared with expectations of $2.05 billion.
As of the end of the fourth quarter, total cash and cash equivalents were US$6.082 billion, a decrease of approximately US$1 billion from the previous quarter. Rivian said it has total liquidity of $6.588 million, which is critical to increasing R2 production.
“We will seize opportunities in terms of additional financing,” Scaringer said, adding that Rivian expects to raise another $2 billion in cash and debt this year through its joint venture with Volkswagen.
In terms of guidance, the company expects vehicle deliveries in 2026 to be between 62,000 and 67,000 units, meeting Wall Street expectations of about 63,400 units and indicating that the upcoming R2 will boost sales.
R2’s rise isn’t without risks, however.
“The biggest risk we face as we scale, and some of the skills we’ve experienced in the past and built around managing, is the complexity of scaling the supply chain and some of the unknowns in the supply chain, which could be as specific as memory or chipsets or as broad as aluminum supply,” Scarinch said.
That said, Rivian expects 2026 adjusted EBITDA losses in the range of $1.8 billion to $2.1 billion, compared with expectations for a loss of $1.8 billion, and capital expenditures of $1.95 billion to $2.05 billion, in line with expectations of $2.05 billion.
Rivian said last month that its manufacturing plant in Normal, Ill., produced 10,974 vehicles and delivered 9,745 vehicles in the fourth quarter, bringing full-year production to 42,284 vehicles and deliveries of 42,247 vehicles, hitting the midpoint of its delivery guidance range of 41,500 to 43,500 vehicles. However, Rivian’s original 2025 delivery target was between 46,000 and 51,000.
The company plans to ramp up its artificial intelligence and technology development as part of its R2 product plan, and investors are eager to learn more about it.
Rivian’s universal hands-free assisted driving software is running. ·Rivian
In December, the company said its new Autonomy platform and software advancements in its Large Driving Model (LDM), a self-driving model similar to a large language model (LLM), will extend its universal hands-free assisted driving to second-generation R1 vehicles, covering 3.5 million miles in the United States.
Later this year, a point-to-point hands-free system will be released, followed by hands-free and eyes-free autonomous driving products, with the ultimate goal of achieving “personal level 4” autonomous driving, which means the vehicle will be able to drive completely autonomously without the driver’s attention.
“We realized we wanted to take a completely new approach to our Autonomy platform, so we started a process that involved developing a camera platform, a perception platform, redesigning the compute platform, and really building the entire system around an AI-centric approach where the vehicles on the road are part of a big data flywheel and we’re collecting data and using that data to train models,” Rivian CEO RJ Scaringe told Yahoo Finance at a December event in Palo. Otto, Calif.
Part of the company’s AI-centric approach is to build its own chip, called the Rivian Autonomous Processor, which will power the self-driving features of Rivian electric vehicles. Previously, the company used Nvidia’s (NVDA) Orin chips in its self-driving computer modules.
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Pras Subramanian is Yahoo Finance’s chief automotive reporter. You can follow him X etc. Instagram.
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