Key Takeaways
- Rivian shares jumped 4% after third-quarter revenue rose 38% to $2.16 billion and the R2 became its best-selling vehicle.
- The test is whether Rivian’s cars turn a gross profit by year-end.
- Rivian expects to unlock $250 million from Uber by year-end.
- Tesla and Lucid both delivered fewer cars than a year earlier.
Rivian Automotive (RIVN) is up 4% today after its third-quarter report showed the new R2 SUV outselling everything else it makes.
CEO RJ Scaringe said Rivian is “very confident” it will hit an autonomy milestone this year that unlocks $250 million from Uber Technologies (UBER), Reuters reported. And the R2 took off while Tesla (TSLA) and Lucid Group (LCID) both delivered fewer cars than a year before.
The details
- Revenue rose 38% to $2.16 billion, ahead of the $2 billion analysts expected, on a record 19,248 deliveries.
- Rivian raised its 2026 delivery guidance to 67,000-70,000, from 65,000-70,000.
The R2 still has to pay for itself
The R2’s ramp cost about $120 million, so the car business lost $80 million at the gross line, up from $36 million in the second quarter. Total gross profit was flat from the second quarter on 30% more revenue:
Still, automotive cost per unit fell more than $12,000 from the second quarter, and Rivian expects the R2 to reach a positive gross margin by year-end.
For Uber, $250 million is small next to its more than $10 billion of free cash flow over the twelve months to June. The bigger prize is the 10,000 R2 robotaxis Uber or its fleet partners are to buy, and Rivian’s Autonomy and AI Day on Dec. 9 should show how close they are.
The R2 is Rivian’s own win
Lucid’s third-quarter deliveries fell 7% from a year earlier and Tesla’s fell 2%, while Rivian’s rose 46%.
Tesla has little to fear yet, with 486,532 deliveries to Rivian’s 19,248. Lucid, which reports on Nov. 9, delivered more cars than it built last quarter to cut inventory, so watch whether its deliveries hold once that runs down.
TIKR tracks 25 analysts on Rivian. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on Rivian, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See Rivian’s Analyst Ratings
Cheap, if the margins show up
Rivian traded at 1.7x forward sales at Thursday’s close, the bottom of its three-year range.
My take: The beat earned today’s jump, and at that multiple the price still assumes the R2 stumbles. A fourth-quarter automotive gross profit would leave plenty of room to run. Of course, another quarter of losses on each car would put the pressure back on Rivian’s cash, after $1.12 billion of negative free cash flow in the third quarter.
So what is Rivian stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
