Rivian (NASDAQ: RIVN) had a strong second-quarter earnings report and is raising its production guidance for 2023, now expecting to build 2,000 more vehicles than it previously forecasted.
Rivian reported earnings on Tuesday and beat expectations in both adjusted loss per share ($1.08 reported vs. $1.41 expected) and revenue ($1.12B reported vs. $1B expected).
CEO RJ Scaringe said:
“Our second quarter results reflect our continued focus on cost efficiency as we accelerate the drive towards profitability. We have achieved meaningful reductions in both R1 and EDV vehicle unit cost across the key components, including material costs, overhead and logistics. It was a strong quarter, and we remain focused on ramping production, driving cost efficiencies, developing future technologies, and enhancing the customer experience.”
Rivian still expects to reach a gross profit sometime next year.
In July, the automaker said it delivered 12,640 units, a substantial improvement from the 7,946 vehicles it reported in Q1.
The biggest metric for Rivian during this quarter was its gross profit per vehicle, which improved by $35,000 from a loss of $67,329 to a loss of $32,595. The company said these changes were able to be achieved through “our continued efforts to drive material cost reductions through commercial negotiations and engineering design change, as well as slightly scaled production.
Earlier this year, Rivian made a 6 percent reduction in staff and sold $1.3 billion in convertible notes to solidify its financial position as it continues to seek more stable operations.
Analysts believe the improvement from Q1 is a tell-tale sign that Rivian is making drastic improvements in its operations.
Dan Ives said in a note last month that Rivian was full of excuses early, but after reporting strong deliveries for Q2, things seemed to be trending in the right direction:
“Production coming out of the gate — it was excuses. It was one step forward, two steps back for four or five quarters. Now [they] finally turned the corner, and I think the worst is in the rearview mirror.”
Rivian stock is down 7 percent today at 10:18 AM on the East Coast.
Disclosure: I am not a RIVN Shareholder.