Rivian Q4 Earnings: Strong Results Overshadowed by Weak Guidance

Rivian Automotive reported better-than-expected Q4 results, posting a loss per share of $0.70, which was narrower than the expected loss of $0.77. Revenue came in at $1.73 billion, exceeding Wall Street estimates of $1.43 billion and representing 32% year-over-year growth. The company produced 12,727 vehicles at its Normal, Illinois plant and delivered 14,183 units in Q4, bringing full-year 2024 deliveries to 51,579 vehicles, slightly ahead of production at 49,476 units.

One of the most significant developments in this earnings report was Rivian achieving its first-ever quarterly gross profit, reporting $170 million in Q4, driven by improvements in production efficiency, higher revenue per vehicle, and cost reductions. However, much of this improvement was aided by $299 million in regulatory credit sales and $214 million in software and services revenue. Despite the milestone, Rivian still reported a net loss of $743 million for the quarter and a full-year 2024 loss of $4.75 billion.

Profitability and Free Cash Flow Commentary

Rivian’s adjusted EBITDA loss for Q4 came in at $277 million, better than the estimated loss of $399.8 million. The company reported a full-year adjusted EBITDA loss of $2.68 billion, improving from $3.78 billion in 2023. Despite these improvements, Rivian’s cash and cash equivalents fell to $5.29 billion, a 33% year-over-year decline, raising concerns about its liquidity. The company expects capital expenditures to rise in 2025 to between $1.6 billion and $1.7 billion, up from $1.41 billion in 2024, as it prepares for the launch of its R2 mid-size SUV in 2026.

Rivian’s CEO, RJ Scaringe, emphasized the company’s focus on cost efficiency, noting that the R2 bill of materials is expected to be about half that of the improved R1 platform. CFO Claire McDonough highlighted the impact of potential policy changes, such as the removal of EV tax credits and tariffs, which could affect demand and margins in 2025.

2025 Outlook and Market Reaction

Rivian provided disappointing 2025 guidance, forecasting vehicle deliveries between 46,000 and 51,000, well below consensus estimates of 55,000 to 59,000 deliveries. The company also projected an adjusted EBITDA loss of $1.7 billion to $1.9 billion, slightly worse than analysts’ expectations of $1.74 billion. The softer outlook led to a 6 percent premarket decline in Rivian stock, though shares later rebounded by 3 percent, showing resilience despite a broader market selloff.

Analysts, including Cantor Fitzgerald, downgraded Rivian to neutral, citing weak delivery guidance, increased macro risks, and policy headwinds. While investors were pleased with Rivian’s progress toward profitability, concerns about slower growth, EV tax credit risks, and production challenges weighed on sentiment.

Stock Reaction and Long-Term Implications

Rivian’s Q4 results highlight operational improvements and cost reductions, but the weak 2025 outlook raises concerns about near-term growth. The company’s ability to scale production efficiently, launch the R2 on schedule, and navigate policy changes will be critical to maintaining investor confidence. Despite near-term headwinds, Rivian’s focus on cost-cutting and expansion into software and services could provide long-term upside. Investors will closely watch updates on the R2 program and demand trends for EVs as the company enters a critical phase in its growth trajectory.