Rivian exceeds Q1 2024 expectations despite plant closure and cost-cutting measures

On May 7, EV startup Rivian announced its first quarter 2024 results, which exceeded analyst expectations regarding revenue growth year-over-year. The automaker reported that it sold 5.1% of U.S. EVs in Q1, an impressive feat, considering that it exclusively offers high-end vehicles. 

While the number of deliveries remained constant at 13,588 units between Q4 and Q1, it increased by 71% compared to the same quarter last year. Additionally, Rivian’s results revealed that the company generated $1.204 billion in revenue, surpassing experts’ predictions. At the end of Q4 2023, Rivian had $9.368 billion in cash, which decreased to $7.858 billion by the end of the first quarter 2024.

The gross margin slightly increased from $43,372 per vehicle to $38,784 per unit in the prior quarter. Although it shows marginal improvement, it is still lower than in the second and third quarters of 2023.

Recently, the EV startup completed a plant closure that began on April 5; hence, it is not included in this quarter’s statistics. The shutdown was aimed at retooling to boost efficiency, which Rivian estimates could result in a 30% increase in efficiency. The firm reports that it has made significant progress in cost optimization and projects a marginally positive gross profit in Q4 of this year. 

During its earnings call, the company will also discuss its R2/R3 announcement, including two future models to penetrate bigger volume and downmarket markets. The R2 model will begin production in the first half of 2026, priced at around $45,000. However, the R3’s schedule and price have not yet been revealed.

Rivian’s primary motivation for introducing these models is to save the company money when fundraising is more challenging than ever. As part of the cost-cutting measures, the automaker reduced employment by 1% and cut capex by $2.25 billion. Additionally, the firm lowered its 2024 capital expenditure forecast from $1.75 billion to $1.2 billion, anticipating financial savings from the plan to switch R2 production to Normal in 2025 and 2026.

Overall, Rivian reaffirmed its forecast for the entire year 2024, which calls for the manufacture of 57,000 units and a $2.7 billion loss. However, it anticipates a small gross profit in Q4.