Here’s what to pay attention to

Rivian (RIVN) will report third-quarter earnings on Thursday after the market close. After supply shortages hampered production, investors are wondering whether the electric vehicle maker will see its first revenue decline since it went public. Here’s what to watch for in Rivian’s third-quarter 2024 earnings report.

What to Expect from Rivian’s Q3 2024 Earnings?

Rivian delivered 10,018 vehicles. in the third quarterwhich is 27% less than the 13,790 transferred in the second quarter of 2024.

After supply shortages began in the third quarter affecting the R1T, R1S and electric vans (EDVs), Rivian reduced its production guidance for the year. Instead of the previous 57,000, Rivian now expects to produce between 47,000 and 49,000 vehicles in 2024.

An additional 13,157 electric vehicles were built last quarter, bringing Rivian’s total production for the first nine months of 2024 to 36,749. That means between 12,251 and 10,251 more electric vehicles will need to be produced at the Normal, Illinois plant in the final three months of the year.

Despite lower production forecasts, Rivian expects slightly higher shipments than last year. Rivian plans to deliver between 50,500 and 52,000 electric vehicles in 2024. from 50 122 in 2023.

	1st quarter 2024	2nd quarter 2024	3rd quarter 2024	2024 YTD	Guidance for 2024
Supplies	13,588	13,790	10,018	37 396	50,500 – 52,000
Production	13,980	9,612	13 157	36,749	47,000 – 49,000

While Rivian said during its first Investor Day in July that it still expects to post first earnings in the fourth quarter of 2024, supply shortages may have derailed plans.

According to recent Bloomberg reportThe shortage was caused by a miscommunication with supplier Essex Furukawa earlier this year. The accident left Rivian without enough copper windings to meet its original production plan.

	3 sq. 22	4th quarter 2222	1st quarter 23	2 sq. 23	3rd quarter 23	4th quarter 23	1st quarter 24	2nd quarter ’24
Rivian losses per vehicle	US$139,277	US$124,162	US$67,329	US$32,594	US$30,500	US$43,372	US$38,784	US$32,705

Rivian’s losses reached $1.46 billion in the second quarter, up from $1.2 billion in the second quarter of 2023. The company lost $32,705 on each electric vehicle it built last quarter. Will losses increase despite lower production volumes?

As it prepares to launch its smaller, more affordable R2, Rivian is aggressively cutting costs and introducing new technologies that can significantly reduce manufacturing costs.

Rivian CEO R.J. Scaringe said upgrades at the Normal, Ill., plant earlier this year marked a “turning point.” In addition to new advanced technology and improved supplier relationships, Scaringe said the change will result in “significant cost reductions.”

Looking to the future

The new technology will serve as the basis for the next generation Rivian R2. Rivian is expected to begin production of the R2 at its Normal plant in early 2026.

The R2 has a starting price of $45, which is almost half the price of Rivian’s current R1S and R1T, which are expected to help significantly expand the market.

Once production of the R2 begins, Rivian expects the new electric vehicle to account for the majority of its production. The company plans to produce 155,000 R2 models annually and about 85,000 normal R1S and R1T models.

Rivian also received Volkswagen support through a new software alliance for next-generation electric vehicles. Volkswagen will invest up to $5 billion, of which $3 billion will go to Rivian and $2 billion to the joint venture. However, they are based on performance targets.

According to RateRivian is expected to report a loss of $0.96 per share in the third quarter of 2024, an improvement from the loss of $1.19 per share last year. Rivian’s revenue is expected to be about $1 billion, down 26% from $1.34 billion in the third quarter of 2023.

Rivian shares are down more than 53% in 2024 and are down more than 90% from the all-time high set shortly after going public in November 2021.

Check back tomorrow after the market closes for Rivian’s third-quarter earnings.