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Yesterday, Rivian Automotive held their earnings call for the fourth quarter of 2022 and provided financial guidance for the road ahead. The Irvine-based EV startup produced 10,020 vehicles during Q4, bringing its total to 24,337 for fiscal year 2022 and shy of its goal of 25,000. The company reported $663 million in revenue for the quarter, which also fell short of estimates, by roughly 10%.
For the coming year, Rivian wants to more than double last year’s production numbers by making 53,000 vehicles. While a significant increase, the number is actually lower than what many analysts had forecast. Rivian’s stock dropped nearly 10% in the hours after the call.
Rivian’s net loss in Q4 was $1.72 billion. While that represents a 30% reduction from the same period last year, which Rivian credits to lower operating losses, it also reaffirms how far the company has to go before it turns a profit. With $12.1 billion left in its coffers, the EV hopeful still has some wiggle room, but at the current burn rate the company will likely be out of cash before the end of 2025.
Chief Financial Officer Claire McDonough says the company believes its balance sheet is in a strong place for the moment, but that Rivian is “continuing to look at a variety of capital market solutions.” That said, with backing from retail giant Amazon, it’s unlikely we’ll see Rivian go bankrupt any time soon. But dilutive fundraising certainly seems like it may be on the table within the next two years.
During the call, CEO RJ Scaringe cited the supply chain, especially in the area of semiconductors, as an enduring challenge for the company, noting that some of its production lines are still unable to run two shifts per day due to limited parts availability. In spite of this, he also claimed that the hiccups in the supply chain are much easier to forecast now than they were at this time last year.
Much of Rivian’s survival is contingent on the company’s ability to launch it’s second platform, the R2, which is expected to be manufactured in the new Georgia plant starting in 2026. This platform will be dramatically cheaper for Rivian to mass produce and will hit price points significantly lower than the current R1T or R1S, which currently start at $74,800 and $79,800, respectively. On the call Scaringe said the R2 development was at a “defining moment,” with many of its engineering, design, and manufacturing facets being finalized.
In addition to the R2, Scaringe also dropped another piece of news that will excite Rivian fans: The much anticipated “Max Packs” version of its R1S SUV is expected to arrive this fall, and boast an enormous range of 391 miles. The company is also getting closer on its “Enduro” drive unit, which will power new, less expensive versions of the R1 lines by using the more cost-effective lithium iron phosphate battery chemistry.
In all, the numbers paint the picture of a company that still has a lot of question marks in its future. It’s possible to see a road to profitability if you squint hard enough, but Rivian has consistently under delivered since its inception. COVID, the market, and the macro economic environment haven’t done the fledgling company any favors, but with legacy automakers piling into the EV game, conditions look poised to get even more challenging in the future.
Oh yeah, and Tesla is supposed to release an update on its long-awaited Cybertruck on March 1st.
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