Rivian narrows losses in Q2 as production ramps up

Electric vehicle startup Rivian met earnings forecasts after taking aggressive cost-cutting measures throughout the second quarter. It continues to eye making its first gross profit by the end of 2024.

Driving the news: Rivian still posted a quarterly net loss of $1.46 billion, slightly better than its Q1 loss of $1.48 billion but worse than its prior-year loss of $1.195 billion. Still, it managed to come out slightly ahead of Wall Street expectations for the period.

• Revenue came in at $1.158 billion, compared to average forecasts of $1.15 billion. This represents a year-over-year increase of roughly 3%.

• Loss per share totaled $1.13, less than the predicted $1.15.

• Rivian’s loss per vehicle averaged $32,705. That’s down about 16% from Q1 but remains almost flat compared to a year ago. In 2022, the company lost well over $100,000 for every car it manufactured.

Looking ahead: Rivian has a lot to look forward to after taking steps to cut costs and simplify production. It remains confident it will achieve a positive gross profit margin before next year.

• The company says it is on track to make $2.7 billion in EBITDA and produce 57,000 units in 2024.

• Development of the cheaper R2 SUV remains on schedule with a launch planned in 2026. The vehicle already has more than 100,000 pre-orders according to Tim Fallon, Rivian’s manufacturing VP.

• The company has heavily streamlined its processes. It’s targeting a 20% reduction in material costs with its second-gen R1, introduced earlier this year.

Bottom line: Whatever your opinion on EVs, Rivian has outlasted many a competing startup in its space, and for good reason. If the company can maintain its momentum long enough for the electric car market to exit its plateau there’s no reason to believe it won’t one day rival segment leaders.

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