Rivian (RIVN) Q1 2022 results – $1.5b loss, 10K new orders, reaffirms 25K production guidance

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Rivian has posted its Q1 2022 results and shareholder letter aft marketplace adjacent today, showing $95 cardinal successful gross and a nonaccomplishment of $1.593 cardinal for the 4th ($1.77 per share), up from a nonaccomplishment of $414 cardinal from the aforesaid 4th past year. It ended the 4th with astir $17 cardinal successful cash, mostly from its massive IPO precocious past year.

Rivian besides reaffirmed 2022 yearly guidance, expecting a full nonaccomplishment of $4.7 cardinal for the twelvemonth with 25,000 units of full accumulation and $2.6 cardinal expected successful superior expenditures. While RIVN dropped 9.6% during trading hours today, the marketplace has responded positively aft marketplace close, with the banal recovering by 5.5% successful aft hours trading.

Rivian noted that this fiscal nonaccomplishment is mostly owed to producing astatine debased measurement connected a high-volume line. Rivian’s mill has been built with a 150,000 tally complaint successful mind, truthful gathering less units than that volition effect successful higher spending per unit. Rivian expects this to proceed successful the abbreviated term, but to amended arsenic accumulation ramps up.

Our past accumulation update from Rivian was connected April 5, conscionable aft the extremity of the quarter, erstwhile Rivian announced it had produced 2,553 vehicles successful Q1 of this year and delivered 1,227 of them. The institution built 1,015 trucks successful 2021, which means a full of 3,568 vehicles produced arsenic of the extremity of Q1.

In today’s shareholder letter, Rivian updated that fig stating that “~5,000” vehicles person been produced arsenic of May 9, which puts accumulation astatine astir 300 units per week since the extremity of March. This means Rivian’s run-rate has astir doubled since the opening of the year, showing bully progress.

Rivian notes that determination person been important challenges related to COVID-19 and proviso concatenation issues constraining production. But contempt these challenges, enactment reaffirms year-end guidance of 25,000 full units produced based connected predictions of the aboriginal proviso concatenation situation (despite dire predictions from CEO RJ Scaringe astir artillery shortages). This would necessitate different approximate doubling of Rivian’s accumulation complaint averaged implicit the remainder of the twelvemonth for it to conscionable these goals.

Production has ramped up connected Rivian’s EDV-700 transportation van arsenic well, but Rivian did not stock numbers connected those. Amazon has already started delivering packages with Rivian vans successful Denver and Los Angeles.

In March, Rivian announced a important terms hike connected existing and aboriginal orders, partially responding to these proviso concatenation issues, and received important backlash from bid holders, galore of whom threatened to cancel. Rivian quickly backtracked and reinstituted the archetypal pricing for bid holders.

While it was feared that this would pb to a nonaccomplishment successful orders, Rivian states successful today’s Q1 missive that nett preorders person accrued since that pricing update, showing beardown demand. Over 10,000 caller R1 pre-orders person been made since the opening of March astatine an mean terms of $93,000. This brings the full magnitude of pre-orders to 90,000.

Going forward, Rivian volition alteration the mode the bid travel strategy works to amended negociate expectations from customers who pre-order vehicles. Rivian volition let caller customers to browse options erstwhile placing an order, but volition not beryllium capable to fastener successful a configuration until person to physique time. This volition let customers to take from the astir updated options and pricing erstwhile configuring their bid and volition assistance Rivian beryllium much nimble successful the look of an uncertain economical and proviso environment.

Finally, Rivian took the accidental to constituent retired the finalization of its deal with Georgia, securing $1.5 cardinal successful economical improvement incentives determination to physique an further factory. With Rivian’s existent currency pain complaint and ample $17 cardinal warfare chest, the institution inactive thinks it has capable currency to money the buildout of this mill and an expected aboriginal mid-price “R2” model, which volition beryllium built connected its ain level astatine the Georgia plant.

Electrek’s Take

While there’s nary unthinkable silver-bullet quality successful this net report, reaffirming full-year guidance is important fixed what has happened implicit the past fewer months. Rivian’s banal has been hammered by the terms hike controversy, wide banal marketplace downturn, proviso concatenation difficulties, and Ford’s determination to merchantability a chunk of their shares (along with different insiders, arsenic the IPO-lockup play ended), leaving investors uncertain and hopeless to perceive immoderate bully news. A driblet from an all-time precocious of $180 down to a stock terms of $20 contiguous volition permission anyone a small spooked.

So a “don’t worry, everything’s going to plan” is adjuvant successful that environment. It has, astatine slightest for aft hours trading today, stopped the bleeding, arsenic investors look relieved to perceive that the entity possibly is not falling arsenic overmuch arsenic they feared it would be.

Rivian’s $17 cardinal (representing astir $12 per share) successful cash, and anticipated spending for the aboriginal plant, is besides a important comfortableness to investors successful a startup during uncertain times. That’s a full batch of money, and it was raised astatine conscionable the close clip and should assistance Rivian skate done the woes of a down banal market. At existent pain rates, it puts Rivian astatine astir 10 quarters worthy of pain earlier the runway runs out, which is much clip than other EV startups have astatine existent pain rates.

Finally, the nett summation successful orders and beardown request was not astonishing for america astatine Electrek, fixed that automakers and the nationalist consistently underestimate EV demand. Right now, radical privation immoderate EV they tin get their hands connected – and adjacent EVs they can’t get their hands on. So 1 happening Rivian apt won’t request to interest astir is selling each motortruck it tin physique for the adjacent fewer years. We wouldn’t adjacent beryllium acrophobic astir other electrical contention arriving connected the scene – if there’s plentifulness of country for aggregate gas-powered escapade trucks, there’s decidedly much than capable country for aggregate EV escapade trucks, peculiarly fixed the galore advantages of electrical drive.

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