Dive Brief:
- Electric vehicle maker Rivian reported gross revenue of $170 million in Q4 2024, which was largely due to reductions in fixed and variable costs and sales of more expensive models, the company announced in its earnings report on Feb 20.
- Cost cutting led to reducing expenses by $31,000 per vehicle, bringing it closer to achieving its goal of a ‘modest’ net profit for the first time ever in 2025, the company said.
- However, Rivian warned of external factors that could impact its 2025 financial outlook, including regulatory and policy changes that could reduce demand, including the elimination of federal incentives that bolstered EV sales over the past several years.
Dive Insight:
Rivian said it produced 12,727 electric vehicles in Q4 2024 at its factory in Normal, Illinois and delivered 14,183 to customers. For the full-year, Rivian produced 49,476 vehicles and delivered 51,579.
Rivian’s Q4 gross profit is a year-over-year improvement from 2023, when it posted a Q4 loss of $606 million. The company also reported that Q4 operating expenses declined by 15% YoY.
“This is a result of outstanding effort from the team driving a focus on cost, driving a focus on continuing to build our demand generation capabilities, and, of course, looking at opportunities to improve efficiency across the business,” CEO RJ Scaringe said on the company’s earnings call.
For the full year, the EV maker reported a negative gross profit of $1.2 billion compared to a $2 billion in 2023. Net loss was roughly $4.7 billion in 2024 compared to $5.7 billion in 2023, indicating that Rivian faces challenges on its road to becoming profitable.
The company also cited the sale of regulatory credits, software and services for the gross revenue increases in Q4. CFO Claire McDonough said Rivian earned revenue on the sale of nearly $300 million of regulatory credits in Q4.
Rivian also cited additional revenue gains from sales of higher priced models. It recently launched new tri-motor versions of the R1T pickup and R1S SUV. The tri-motor R1T starts at $99,900.
“We're seeing a higher take rate on our Tri-Motor than what we expected,” Scaringe said on the earnings call.
The company also boosted revenue from its joint venture with Volkswagen Group that includes a collaboration on EVs and software. The value of the JV is expected to reach $5.7 billion in 2027 and benefit both automakers. The JV officially launched in November.
Rivian expects to recognize $2 billion of consideration from Volkswagen as revenue as the JV executes its development roadmap over the next four years, McDonough said on the call.
Rivian is now focused on launching its more affordable R2 SUV, the first mass-market offerings from the company. Scaringe says the cost cutting efforts at the company are crucial to support the launch of the new models.
“Our focus on cost efficiency across the business is critical for the launch of our mass market product, R2,” said Scaringe in the release. The CEO said that the R2 could be a “transformational product” as Rivian aims to become a major player in the growing EV segment. He said that the vehicle is still on track to launch in the first half of 2026.
Scaringe said that Rivian has already sourced 95% of the bill of materials for the R2, which is expected to be roughly half the cost of the R1. Rivian also improved manufacturing efficiencies for the R2. The company is using large high-pressure die castings to eliminate approximately 65 parts compared to the R1, which reduces the number of joints in the body by around 1,500, according to Scaringe.
Rivian’s 2025 full year guidance targets sales of 46,000 to 51,000 vehicles, with an adjusted EBITDA between $1.7 and $1.9 billion. However, McDonough told analysts that the company expects lower than anticipated volumes in Q1 due to seasonality and a challenging demand environment due to the devastating wildfires last month in the Los Angeles area. She said that it's historically been one of Rivian’s largest markets.
