Rivian (RIVN) stock fell sharply after the electric adventure vehicle maker reported mixed fourth-quarter results and production and profit forecasts that fell short of Wall Street expectations.
Rivian announced on Wednesday that it expects production to reach 57,000 vehicles in 2024, well below the forecast of 80,000. In terms of full-year profitability, Rivian reported an adjusted EBITDA loss of $2.7 billion versus $2.59 billion (expected) and capital expenditures of $1.75 billion versus $2.37 billion (expected). He said he expects it to reach US$. Rivian announced it would cut 10% of its paid staff due to economic uncertainty.
Rivian stock fell about 15% in premarket trading Thursday.
For the quarter, Rivian reported revenue of $1.32 billion vs. $1.25 billion (estimated) and adjusted loss per share of $1.36 vs. $1.33 (estimated). On an adjusted EBITDA basis, Rivian reported a loss of $1.096 billion versus $1.05 billion (estimated), narrower than last year's loss of $1.46 billion.
“Despite economic headwinds, we made significant progress in 2023 and are excited about the year ahead,” Rivian CEO RJ Scaringe said in a statement. While we strongly believe in the full electrification of the automotive industry, we recognize the challenging macroeconomic conditions in the short term. I'm trying hard,” he said. Build go-to-market capabilities to secure positive margins and support our long-term growth. ”
Regarding its cash cushion, Rivian said it had $7.86 billion in cash and cash equivalents at the end of the fourth quarter, down from $9.1 billion at the end of the third quarter.
Some vehicles in the first quarter may not be delivered to customers due to missing components. It will then be delivered immediately.
Earlier this month, Rivian reported fourth-quarter deliveries of 13,972, a significant increase from the same period last year but below consensus estimates of 14,300. Production numbers increased significantly to 17,541 units, exceeding the expected 16,574 units.
Rivian CFO Claire McDonough said on an earnings call that Rivian expects first-quarter 2024 deliveries to be 10 to 15 percent lower than fourth-quarter 2023 deliveries.
“During this quarter, we will begin to feel the effects of some of the supplier switching we are engaged in (due to the shutdown and enhancements in the second quarter),” CEO RJ Scaringe said. added on the conference call. He said some vehicles could not be delivered to customers in the first quarter due to a lack of parts.
This year, Rivian has produced 57,232 vehicles and delivered 54,000 vehicles in 2023, exceeding its production target of 54,000 vehicles. His 2024 production forecast for Rivian is pegged at just over 80,000 units per year, according to Bloomberg consensus estimates.
Rivian also reiterated its forecast to reach “decent gross margins” by the end of 2024. McDonough said the company is “very close” to achieving a positive contribution margin by the end of 2023.
Rivian's profitability plan is paramount to the company, its survival, and its investors' proposition. Pure-play EV makers like Rivian, Lucid (LCID), and Fisker (FSR) have seen their stock prices decline over the past year as a series of losing quarters and a challenging EV demand environment made investors unable to tolerate underperformance.
On March 7, Rivian will unveil its more affordable R2 EV, which will be built at its upcoming $5 billion assembly plant in Georgia. Rivian aims to complete the factory by 2025 and have the new R2 vehicle off the line in 2026.
“The impact of weak demand is significant,” Barclays analyst Dan Levy wrote in a note to investors last week, and Barclays downgraded Rivian's stock from “buy” to “hold.” Mr. Levy also expressed concern that Rivian may not be able to meet its 2024 target for gross margin.
“Even with good products and technology, it doesn't seem to be enough to avoid an EV winter,” he said.
Pras Subramanian is a reporter for Yahoo Finance.you can follow him twitter And even more Instagram.
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