147 views 4 mins 0 comments

Rivian slashes production outlook, announces job cuts as EV demand wanes

In Business
February 22, 2024

Rivian (RIVN) stock tanked after the bell on Wednesday after the electric adventure vehicle maker reported mixed fourth quarter results and a production and profit forecast that missed Wall Street expectations.

Rivian said it sees vehicle production for 2024 hitting 57,000 units, well below the 80,000 units expected. In terms of full-year profitability, Rivian said it sees an adjusted EBITDA loss of $2.70 billion vs. $2.59 billion (est.), with capital expenditure outlays hitting $1.75 billion vs. $2.37 billion (est.). Rivian said it would cut 10% of salaried staff, citing economic uncertainty.

Rivian stock fell over 15% in after-hours trading.

For the quarter, Rivian reported top-line revenue of $1.32 billion vs $1.25 billion (est.), with an adjusted loss per share of $1.36 vs. $1.33 (est.). On an adjusted EBITDA basis, Rivian reported a loss of $1.096 billion vs. $1.05 billion (est.), narrower than last year’s $1.46 billion loss.

A Rivian R1S electric sports utility vehicle (SUV) charges at a ChargePoint, Inc. public EV charging station in Redondo Beach, California on June 12, 2023. (Photo by Patrick T. Fallon / AFP) (Photo by PATRICK T. FALLON/AFP via Getty Images)

A Rivian R1S electric SUV charges at a ChargePoint, Inc. public EV charging station in Redondo Beach, Calif., on June 12, 2023. (PATRICK T. FALLON/AFP via Getty Images) (PATRICK T. FALLON via Getty Images)

“We made great progress in 2023 despite economic headwinds, and we’re excited about the year ahead. We firmly believe in the full electrification of the automotive industry, but recognize in the short-term, the challenging macro-economic conditions,” Rivian CEO RJ Scaringe said in statement. “We are aggressively focused on driving cost efficiency throughout the business, achieving positive margins and building our go-to-market function to support our long-term growth.”

In terms of its cash cushion, Rivian said it had $7.857 billion in cash and cash equivalents at the end of Q4, down from the $9.1 billion it had at the end of Q3.

Earlier this month, Rivian reported 13,972 deliveries in Q4, up significantly from a year ago but below consensus estimates of 14,300. Production was notably higher at 17,541 units, above estimates of 16,574.

For the year, Rivian topped its production goal of 54,000 with 57,232 vehicles produced in 2023 and deliveries coming in at 50,122. Rivian’s production forecast for 2024 is pegged at just over 80,000 vehicles for the year, per Bloomberg consensus estimates.

Rivian also reiterated its forecast of reaching “modest gross profit” by the end of 2024.

Rivian’s profitability plans are paramount to the investor thesis for the company — and for its survival. Pure-play EV makers like Rivian, Lucid (LCID), and Fisker (FSR) have seen their shares hammered over the past year as a string of loss-producing quarters and a tough EV demand environment have left investors with little patience for underperformance.

On March 7, Rivian will reveal its more affordable R2 EV, which will be built at its upcoming $5 billion Georgia assembly plant. Rivian is aiming for the plant to be completed by 2025, with new R2 vehicles rolling off the line in 2026.

“The consequences of weak demand are significant,” Barclays analyst Dan Levy wrote in a note to investors last week, in which the investment bank downgraded Rivian stock to Hold from Buy. Levy also raised concerns that Rivian could miss its 2024 target for gross margin profitability.

“It appears that even great product and tech is not enough to avoid the EV winter,” he said.

Pras Subramanian is a reporter for Yahoo Finance. You can follow him on Twitter and on Instagram.

For the latest earnings reports and analysis, earnings whispers and expectations, and company earnings news, click here

Read the latest financial and business news from Yahoo Finance

EMEA Tribune is not involved in this news article, it is taken from our partners and or from the News Agencies. Copyright and Credit go to the News Agencies, email [email protected] Follow our WhatsApp verified Channel210520-twitter-verified-cs-70cdee.jpg (1500×750)

Support Independent Journalism with a donation (Paypal, BTC, USDT, ETH)
Avatar
/ Published posts: 42121

The latest news from the News Agencies