- Rivian (NASDAQ:RIVN) reported its Q1 earnings on Wednesday
- The electric vehicle (EV) company maintained its 2022 production guidance of 25,000 vehicles
- However, profitability remains a key issue
Shares of Rivian (NASDAQ:RIVN) are in the green after the company reported its Q1 earnings yesterday. Rivian delivered a somewhat mixed report, as revenue came in at $95 million versus the consensus estimate of $130.5 million. The EV company posted a net loss of $1.59 billion and an earnings per share (EPS) loss of $1.43. Analysts were expecting an EPS loss of $1.44.
A positive for RIVN stock was that the company maintained its 2022 production guidance of 25,000 vehicles. During Q4, Rivian halved its guidance from 50,000 vehicles to the current figure.
With that in mind, let’s get into the details of the earnings report.
Why Is RIVN Stock Trading Higher Today?
Rivian disclosed that it now has more than 90,000 reservations for its R1T and R1S EVs, up from 83,000 during March. The 90,000 reservations include about 10,000 new reservations since Rivian raised prices, with an average purchase price of about $93,000. Since the start of production last fall, the company has produced about 5,000 vehicles.
The automaker disclosed that its “top priority for 2022” is to ramp up production at its Normal, Illinois, facility. The facility will have the capability to produce up to 150,000 vehicles per year once it is running at full capacity. Total planned annual capacity for Rivian’s Illinois and Georgia factories is 600,000 vehicles.
Rivian also provided updates for its electric delivery van (EDV). The EDV comes in two sizes, 700 cubic feet and 500 cubic feet. Both vehicles are built on the Rivian Commercial Van (RCV) platform, which is optimized for “operating costs, driver interaction, and connected fleet management.”
As of March 31, Rivian had $16.97 billion of cash on hand. The company stated that the cash balance is enough to cover spending through the launch of the R2. The R2 will likely begin production in 2025. This was reassuring for shareholders, as it hints at no further debt or equity offerings in the near term.
What’s Next for Rivian?
Rivian has a long-term goal of achieving more than 10% of the global automobile market share. The company also reaffirmed its 2022 guidance of a net loss of $4.7 billion, as well as $2.6 billion in capital expenditures.
Additionally, Frank Klein will be joining Rivian as chief operating officer on June 1. Klein previously oversaw Magna Steyr’s (NYSE:MGA) production of its first EV. In 2021, Klein was named one of Automotive News Europe’s Eurostars for his efforts in expanding Magna’s contract manufacturing business.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.