3 predictions for Rivian’s Q1 earnings – TechCrunch

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Rivian, the Irvine, Calif.-based electric vehicle startup, has faced mounting production pressures since launching late last year in one of the largest IPOs in U.S. history.

In March, the company adjusted its full-year forecast to 25,000 vehicles, down from an initial projection of 40,000 due to supply chain constraints. On Monday, Rivian’s stock plummeted more than 17% after a report that Ford had sold 8 million shares in the upstart EV company.

Given the company’s dramatic fall from public-market grace since its debut, its impending earnings report will carry extra weight.

What do we have our eyes on? When the automaker reports its first-quarter financial results later Wednesday, industry watchers will be especially interested in the company’s production outlook and handling of supply constraints, as well as its relationship with Ford and its progress on a factory in Georgia slated to open by early 2024.

What analysts and TechCrunch will look for

Despite its industry’s headwinds, analysts expect Rivian to narrow its losses compared with the fourth quarter of 2021, the first time it reported financial results as a public company. Per data from Yahoo Finance, analysts expect Rivian to report a loss of $1.44 per share (adjusted) on revenue of $130.5 million in Q1 2022. That compares with a loss of $2.43 per share on revenue of $54 million that Rivian reported for the fourth quarter of 2021.

Production bottlenecks and supply chain constraints

Rivian has been stymied by the same supply shortages and production bottlenecks facing the rest of the automotive industry this year. The global supply chain crunch forced the company in March to cut its full-year production forecast by nearly 38%, so we’ll be watching for any updates on Rivian’s projections.

The EV maker built 2,553 vehicles and delivered 1,227 in the first quarter, which means it must increase production tenfold for the rest of the year to catch up with its forecast. (EV companies tend to report their production and delivery volume ahead of their formal earnings reports.)

The company, which began deliveries of its first two models – the Rivian R1T electric pickup and R1S SUV – in the fourth quarter of last year, now faces intensifying competition from legacy automakers, including Ford’s Lightning F-150 and General Motors’ forthcoming Silverado battery-electric pickups.

Relationship with Ford

Ford held a 12% stake, or about 102 million shares, in the company until selling 8 million shares after an insider lockup for the stock expired Sunday. The move sent the startup’s shares plummeting. Ford retains a material stake in Rivian, it’s worth noting.

Rivian’s opening stock price of $106.75 put its market cap above both Ford and GM. Since its November 2021 debut the value of its shares has fallen more than 75%. Ford reported a first-quarter loss of $3.1 billion largely due to a write-off of the value of its investment.

We’ll be listening for updates on its relationship with Ford, as well as Amazon, another large shareholder, which recently reported a $7.6 billion loss on its stake in Rivian.

Georgia

Finally, we’ll be watching for news on Rivian’s $5 billion EV factory in Georgia, which the company is expected to break ground on this summer. The former startup received the state’s largest-ever incentives package of $1.5 billion to build the plant on a 2,000-acre site east of Atlanta.

In return, Rivian has pledged to hire 7,500 workers at an average annual salary of $56,000 by the end of 2028. However, the project has stirred up local controversy on a number of fronts.

Rivian said the facility is targeting an annual production capacity of 400,000 vehicles – double that of its plant in Normal, Ill.

That’s what we have on our minds heading into the report. More when we have the numbers.