Rivian Automotive Inc (NASDAQ:RIVN) reported a first-ever gross profit of $170 million in the fourth quarter of fiscal year 2024, surpassing analysts' expectations with total revenue of $1.73 billion, driven by strong demand for its updated product lineup and increased software and services revenue.
The electric vehicle (EV) manufacturer attributed its positive gross profit to a $31,000 reduction in the cost of goods sold per vehicle and an increase in average selling price to $86,000, reflecting higher sales of its premium R1 and tri-motor models.
Despite these gains, Rivian provided conservative guidance for fiscal year 2025, projecting deliveries between 46,000 and 51,000 vehicles, a decrease from the previous year. Rivian’s outlook accounts for a planned month-long production halt in the second half of 2025 to upgrade assembly lines for the upcoming R2 vehicle launch, expected in the first half of 2026.
Analysts at Wedbush called Rivian’s full-year 2025 guidance “very hittable as the company navigates a murky macro backdrop while looking to take out costs across its operations to reach its profitability goals.”
The company also announced a joint venture with Volkswagen, aiming to recognize $1.96 billion in revenue over the next four years by supplying new vehicle electrical architecture and software services. Rivian anticipates over $1 billion in software and services revenue in fiscal year 2025, targeting a long-term margin of 30%.
In addition, Rivian secured a loan of up to $6.6 billion from the Department of Energy to support the development of its Georgia manufacturing facility, ensuring sufficient funding through the R2 ramp-up in Normal, Illinois, and the midsize platform in Georgia.
“We continue to remain confident in the long-term Rivian vision that is in the midst of massive transformation while looking to optimize its R1 production while preparing to ramp its R2 and midsize platform supply chains,” Wedbush analysts wrote.
Analysts from Wedbush maintained an ‘Outperform’ rating with a $20 price target.
Following the earnings announcement, Rivian's shares initially rose by as much as 7% in extended trading before turning negative. As of Friday morning, the stock was down approximately 6%.