Rivian reported mixed first-quarter results but will achieve further cost savings by moving upcoming R2 production to its Normal, Illinois, plant and cutting its capital expenditure forecast. The electric vehicle maker also reiterated its full-year loss forecast and still sees a “path” to a “modest gross profit” in the fourth quarter of this year.
For the quarter, Rivian reported revenue of $1.20 billion versus expected $1.17 billion, up 80% year-over-year. However, Rivian posted a loss per share of $1.48 versus $1.27 estimated, with an operating loss of $1.484 billion compared to the expected $1.299 billion.
Rivian reiterated its adjusted EBITDA loss forecast of $2.7 billion for 2024, but now expects its capital spending to improve to $1.2 billion from $1.75 billion previously. This comes as the company moves the start of R2 production to its Normal, Illinois facility and expects further savings in 2025 and 2026.
Rivian shares fell 5% in early trading Wednesday.
“We achieved several milestones this quarter, including producing our 100,000th normal vehicle, successfully completing the conversion upgrade and introducing our new mid-size platform underlying the R2, R3 and R3X,” said CEO RJ Scaringe in a statement.
The company also said that Rivian remained “confident of achieving modest gross profit in the fourth quarter of this year” due to the retooling and other improvements.
By moving R2 production to its existing U.S. factory instead of its future Georgia factory, Rivian said Tuesday, the company will save more than $2.25 billion. Following the introduction of the R2 and factory changes, the company now expects its normal factory to achieve a total annual capacity of 215,000 units across all vehicles, including up to 155,000 units of the R2.
Rivian said it had $5.98 billion at the end of the first quarter, up from $7.86 billion at the end of the fourth quarter.
Last month, the company reported first-quarter R1T and R1S production of 13,980 and deliveries of 13,588, beating expectations of around 12,400 units. The company also reiterated production forecast of 57,000 vehicles in 2024.
Part of the reduction in those costs came in the form of a 10% reduction in workforce, with the company citing economic uncertainty. Although Rivian reiterated its guidance to achieve “modest gross profit” by the end of 2024, Rivian did not repeat previous statements that it was “very close” to achieving a positive contribution margin by the end of 2023. Earlier this year, Rivian said that its factory development in Georgia was paused for now, although Georgia Governor Brian Kemp said Scaringe reiterated that the company would not abandon the project.
Scaringe said once the R2 is ready for a larger rollout, the upcoming Georgia plant will handle it. The company also said it would launch its R2 in Europe, which would be a huge market for the company as it doesn’t currently sell its larger R1 vehicles on the continent.
Pras Subramanian is a reporter for Yahoo Finance. You can keep following him Twitter and further Instagram.
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