Rivian earnings preview: Production, path to profitability in focus

Rivian (RIVN) shares will be in focus after the bell as the electric adventure vehicle maker will report its Q4 financial results. Of particular interest for investors will be its new annual production target and its projected loss for 2023.

From a deliveries standpoint, the company already reported that for the quarter it produced 10,020 vehicles and delivered 8,054. For the year, Rivian produced 24,337, narrowly missing its 2022 forecast for 25,000 units, which was a positive development for the company given its early production ramp difficulties and supply chain hiccups. It delivered 20,332 units for the year.

“The Street will ultimately be focused on what production and delivery factors will look like into FY23 as the company capitalizes on its existing demand with the 2023 delivery numbers of around 60,000 unit deliveries looking hittable,” Wedbush analyst Dan Ives said in a note to investors on Monday.

For Q4, analysts are expecting the following top and bottom line performance:

That revenue figure would represent a 34% jump from Q3, though its net income loss projection for Q4 is expected to widen slightly. For the year, Rivian is expected to report an adjusted EBITDA loss of $5.45 billion for the year.

At the end of the third quarter Rivian announced it had 114K preorders for its R1T and R1S vehicles, though in a surprise the company said it would no longer be issuing pre-order data going forward. The company did note that its ASP (average selling price) was rising higher versus earlier quarters, which is good news for a company that is still suffering heavy negative net margins for each vehicle produced.

Any kind of guidance on pre-orders is still important, however. “With this macro backdrop and delivery delays, a looming question on the Street is if consumers are canceling orders due to either the softer macro backdrop or simply, Rivian’s current production output taking so much time and if there is a tangible churn rate in this area,” Ives noted.

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Other important data points for investors to keep track off are Rivian’s cash reserves (the company reported $13.3 billion in cash and equivalents at the end of last quarter), and its capex guidance, which the company trimmed to $1.75 billion for 2022 due to a “streamlined product roadmap.”

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Pras Subramanian is a reporter for Yahoo Finance. You can follow him on Twitter and on Instagram.

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