Rivian shares jump after quarterly sales beat expectations

Rivian shares rose more than 6% on Friday, closing at $12.16. The gain followed the company's Thursday announcement of third-quarter results that showed a sharp increase in revenue and vehicle deliveries.

The Irvine-based manufacturer reported $2.15 billion in revenue for the quarter. That figure represents a 38% increase from the same period last year. Vehicle deliveries climbed 46% year over year.

The growth was driven primarily by the R2, a new model that launched in June. The R2 became the company's best-selling vehicle by volume during the third quarter. Rivian produced 19,751 vehicles at its facility in Normal, Illinois, and delivered 19,248 of them.

Despite the sales growth, the company has not been profitable since its founding in 2009. Rivian went public in 2021 and reported a loss of $3.6 billion last year. For the third quarter this year, the company posted an automotive gross loss of $80 million. That is an improvement from a $130 million loss in the third quarter of last year.

Chief Executive RJ Scaringe stated that the company is targeting positive automotive gross profits by the end of 2026. The reduced loss in the current quarter was attributed to higher delivery volumes and improved per-unit margins.

The company recently cut about 2% of its workforce following the first deliveries of the R2. The R2 is a key new model with a lower price tag. Rivian currently sells only the performance version of the R2, which is priced at $57,990. This is a step down from the company's typical vehicle prices of around $77,000.

Seth Goldstein, an analyst at Morningstar, noted that raising the delivery guidance is a good sign for the near term. "Raising the delivery guidance shows that R2 production is ramping up, and that's a good sign in the near term for Rivian," Goldstein said. The company raised the lower end of its full-year delivery guidance range to 67,000 units from 65,000.

Rivian plans to introduce the R2 Premium in late 2026 for around $54,000. An R2 Standard version is scheduled for 2027 at a price of $44,990. Goldstein said the lower-priced release should open the brand up to a wider number of consumers.

The company is also expanding its charging infrastructure. Rivian is adding more than 150 public EV chargers to Caruso properties, including The Grove and the Commons at Calabasas. The company is also developing self-driving technology, with the R2 currently available with a universal hands-free driver assistance package.

Chris Pierce, an analyst at Needham & Company, said Rivian is closing the gap with Tesla in autonomous software capabilities. "They're closing the gap with Tesla and widening the gap with legacy automakers like GM and Ford," Pierce said. Scaringe said in a statement that the autonomy platform is progressing rapidly and laying foundations for a future that is fully electric, autonomous, and AI-defined.