Rivian Stock: Price Swings and News Updates

Rivian's Q3 "Beat": Smoke and Mirrors or Real Progress?

Rivian Automotive (RIVN) managed to "beat" Wall Street's expectations for the third quarter. Revenue came in at $1.56 billion against an expected $1.5 billion, and adjusted loss per share was 65 cents versus the predicted 72 cents. The stock jumped over 3% in extended trading, which sounds like a win, right? Let's dig into the numbers before we pop the champagne.

The Gross Profit Mirage

The headline figure is the reported $24 million gross profit, seemingly crushing estimates of a $38.6 million loss. But here's where it gets interesting (or, depending on your risk tolerance, alarming). That $24 million isn’t purely from selling EVs. It includes a $130 million loss in automotive operations. The profit comes from $154 million tied to their VW joint venture and software/services. (The JV is, of course, still in its early stages.)

So, while Rivian can technically claim a gross profit, it's propped up by external factors. The core business of building and selling electric vehicles is still bleeding money. A $130 million loss is a significant improvement from the $249 million loss in the same period last year, but it's still a loss. Are they improving? Yes. Are they profitable on their own merits? Not yet. The question is whether they can achieve profitability before their substantial cash reserves dwindle.

Rivian reaffirmed its full-year guidance: adjusted earnings loss between $2 billion and $2.25 billion, and vehicle deliveries of 41,500 to 43,500 units. They also expect to be around breakeven on gross profit. This is a downgrade from earlier in the year when they were aiming for a modest profit. It feels like they are walking back expectations.

R2 Hopes and Supply Chain Realities

RJ Scaringe, Rivian's CEO, stated the company doesn't anticipate delays to the R2 production (scheduled for the first half of next year) due to rare earth mineral or chip supply chain concerns. This is crucial, as the R2 is expected to be a more mass-market vehicle, potentially unlocking a new level of demand.

But let's be real. Supply chains are notoriously unpredictable. Scaringe's confidence could be genuine, or it could be a calculated attempt to reassure investors. I've looked at hundreds of these filings, and overly optimistic statements about supply chain security always make me nervous. What happens if there is a hiccup? What's the contingency plan? Details on specific mitigation strategies remain scarce.

Rivian ended the quarter with $7.7 billion in total liquidity, including nearly $7.1 billion in cash, cash equivalents, and short-term investments. Scaringe says this "really well positioned" them for the R2 launch. But burning through hundreds of millions each quarter isn't sustainable, even with billions in the bank.

The market seems to be reacting positively in the short term. Rivian's stock (RIVN) initially fell 5.23% before gaining 3.2% in extended trading after the earnings release. This volatility reflects the uncertainty surrounding the company's future. Investors are clearly torn between the potential of the R2 and the ongoing losses. AMD, Super Micro Computer, Upstart Holdings, Pinterest And Rivian: Why These 5 Stocks Are On Investors' Radars Today - Advanced Micro Devices (NASDAQ:AMD)

Reality Check: The Road to Profitability Remains Paved with Challenges

Rivian's Q3 "beat" is a classic case of carefully managed expectations and strategic accounting. The underlying reality is a company still heavily reliant on external factors to mask its core operational losses. While progress is evident, the path to sustainable profitability is far from guaranteed. The R2 is the key, but its success hinges on factors outside of Rivian's complete control. The question now isn't just "can they build it?" but "can they build it profitably, and at scale, in a world of persistent supply chain uncertainty?"