Rivian’s Third Quarter Financial Report
Electric vehicle (EV) startup Rivian reported revenue of $874 million in the third quarter, which is more than 12% lower than analysts’ estimates. This significant drop in revenue is attributed to a component shortage that disrupted production of its flagship R1S and R1T vehicles.
Supply Chain Disruptions
Last month, Rivian lowered its annual production guidance to 47,000 to 49,000 vehicles due to the "acute" supply problem for a component within its Enduro motor. The Enduro motor is a single-motor-per-axle system used in Rivian R1 vehicles and was first introduced in vehicles in 2023. This effort to bring design in-house has negatively affected production.
"This has been a tough quarter for us because of some of those supply chain or supply ramp challenges, and one of those suppliers in particular has limited our production quite substantially," said founder and CEO RJ Scaringe. "And we’re working very, very hard to address that. This is one of our highest priorities in terms of the business, and we’re seeing this is really a short-term issue, but it certainly introduced challenges."
Production Gap
While the supplier problem was largely responsible for its revenue hit, there was still a gap between production and delivery in the third quarter. Rivian produced 13,157 vehicles but only delivered 10,018 – a difference that suggests demand for its pricey EVs was also a factor.
Revised Annual Earnings Guidance
Rivian now says it will revise its annual adjusted earnings guidance to between a $2.82 billion and $2.87 billion loss. The company had previously estimated an adjusted earnings loss of $2.7 billion.
Comparison with Previous Quarter
Rivian’s third-quarter revenue of $874 million is 34.6% lower than the $1.33 billion it generated in the same period last year. Revenues from the sale of regulatory credits were $8 million for the quarter.
Efforts to Improve Efficiency and Reduce Costs
Despite the gloomy revenue numbers, driven by lower production and deliveries, Rivian is attempting to rein in costs, improve efficiency, and market the next generation of its flagship R1T pickup truck and R1S SUV as well as commercial vans, which are primarily sold to Amazon.
Next-Generation R2 Platform
Rivian has started production of a tri-motor variant of the R1 vehicles – a more expensive version that could provide some capital and supply chain relief. Additionally, the company continues to make progress on its next-generation R2 platform, a midsize SUV that Scaringe said "will be a fundamental driver of Rivian’s growth."
Partnership with LG Energy Solution
Rivian announced Thursday a battery supplier partnership with LG Energy Solution (LGES) to supply batteries for the R2. Under the agreement, LGES will supply 4695 cylindrical battery cells, which will be produced at a factory in Queen Creek, Arizona.
Outlook on R2 Production
Rivian expects R2 production to begin in the first half of 2026.
Key Statistics
- Revenue: $874 million (down more than 12% from analysts’ estimates)
- Annual production guidance: 47,000 to 49,000 vehicles
- Revised annual adjusted earnings guidance: between a $2.82 billion and $2.87 billion loss
- Revenues from regulatory credits: $8 million for the quarter
- Comparison with previous quarter: 34.6% lower revenue than the same period last year
Conclusion
Rivian’s third-quarter financial report indicates that the company is facing significant supply chain disruptions, which have negatively impacted production and revenue. Despite efforts to improve efficiency and reduce costs, Rivian’s future outlook remains uncertain. However, with its next-generation R2 platform on the horizon, the company may be able to regain momentum in the electric vehicle market.
