Rivian Cuts Annual Earnings Forecast on Inflation, Supply Woes
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Rivian Automotive Inc. posted quarterly sales above Wall Street’s expectations and reaffirmed its delivery forecast, but the electric vehicle maker trimmed its full-year earnings expectations as it continues to grapple with supply chain snags, high costs and economic volatility.
Sales in the second quarter rose to $364 million, the Irvine, Calif.-based company said Aug. 11 in a statement. Analysts had predicted $335.7 million on average, according to estimates compiled by Bloomberg. Rivian’s adjusted loss was slightly wider than expected.
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Rivian, which makes the R1T pickup and R1S sport utility vehicle along with electric delivery vans, still expects to manufacture 25,000 EVs this year. However, the company lowered its adjusted earnings guidance, expecting a full-year loss of $5.45 billion, citing the increasing production rates and higher input costs from raw material inflation. Rivian had previously seen adjusted earnings before interest, taxes, depreciation and amortization of negative $4.75 billion.
“Our core focus remains on ramping production,” the company said in the statement. “However, we believe that supply chain constraints will continue to be the limiting factor of our production.”
Since its blockbuster initial public offering last year, Rivian has been seen as a top contender in the pack of EV startups chasing market leader Tesla Inc. But Rivian has struggled with production at its plant in Normal, Ill., and broader supply chain issues. The company said recently that it would cut 6% of its workforce as changing market conditions impact its ability to raise capital.
Its shares rose less than 1% at 4:52 p.m. in late New York trading, paring a loss of as much as 6.7%. The stock fell 62% this year through Aug. 11’s close.
Rivian ended the quarter with approximately $15.5 billion of cash and cash equivalents. The company also lowered its full-year capital expenditures guidance to $2 billion, down $600 million. The company attributed the cut to a “streamlined product road map” and a decision to push back certain investments until 2023.
Rivian has a contract with Amazon.com Inc, one of its biggest investors, to produce 100,000 delivery vans by the end of this decade.
The company also said it added Harald Kroeger to its board. The former Mercedes-Benz executive adds to Rivian’s existing directors, including former Patagonia chief Rose Marcario and Amazon executive Peter Krawiec.
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