Rivian Shares Rise After Lifting Outlook and Reaffirming Volkswagen Partnership

Shares of Rivian Automotive rose approximately 5% in after-hours trading on Thursday following the release of the company's third-quarter financial results. The electric vehicle maker posted consolidated revenue of $2.16 billion, marking a 38% increase compared to the same period last year and surpassing consensus estimates. Automotive revenue reached $1.55 billion, while software and services revenue grew 45% to $605 million.

The company narrowed its adjusted net loss per share to $0.48, beating Wall Street projections of a $0.56 loss. Rivian reported an adjusted EBITDA loss of $435 million, which was narrower than the $575.9 million loss recorded in the prior-year period. Total gross profit stood at $176 million, improving significantly from the previous quarter, although the standalone automotive segment remained negative.

A major driver behind the positive quarter was the rapid market adoption of Rivian's new R2 SUV, deliveries of which began in June. CEO RJ Scaringe noted that the R2 has quickly become the company's bestselling vehicle by volume, outselling both the R1 line and the electric delivery van. Rivian raised its full-year delivery guidance to a range of 67,000 to 70,000 vehicles, up from its previous projection of 65,000 to 70,000 units.

To support scaling, Rivian has initiated a second production shift at its manufacturing facility in Normal, Illinois. During the third quarter, the company produced 19,751 vehicles and delivered 19,248, representing a 46% increase in deliveries year-over-year. Management now expects adjusted core losses for the full year to land between $1.75 billion and $1.85 billion, representing a $100 million improvement at the midpoint, while lowering capital expenditure guidance to $1.4 billion to $1.5 billion.

Rivian also reaffirmed its strategic partnership with the Volkswagen Group, easing recent market concerns. Roughly 60% of Rivian's software and services revenue during the quarter stemmed from its joint venture with the German automaker. Scaringe stated that the partnership remains strong and announced that the first tangible output from the collaboration will launch next year with Volkswagen's ID.EVERY1 electric vehicle in Europe.

Addressing questions about the partnership's future following reports that Volkswagen might incorporate software from Chinese automaker XPeng for certain European models, Scaringe expressed continued confidence. He emphasized that the joint venture serves as a powerful demonstration of Rivian technology outside the domestic market. The CEO added that Rivian has received $5.3 billion out of $5.8 billion in expected capital commitments from the Volkswagen partnership, with the final $460 million anticipated in late 2027.

Beyond Volkswagen, Rivian is advancing collaborations with Amazon and Uber. The company recently commenced deliveries of new electric delivery van variants designed for rural routes, featuring all-wheel drive and a larger battery pack offering 30% more range. Furthermore, Rivian remains on track to hit a year-end milestone with Uber to deploy vehicles as robotaxis on the ride-hailing platform, a move expected to unlock an additional $250 million equity investment.

Rivian concluded the quarter with approximately $5.5 billion in cash, cash equivalents, and short-term investments, and total liquidity of about $6.1 billion. Despite the positive financial updates and a jump in retail investor sentiment on platforms like Stocktwits, Rivian shares have still declined roughly 42% over the course of the year.