Rivian Q2 2024 Earnings Results (Report Summary) ?

[mkhuffman]

That's exactly why they're stating they'll have a gross profit in Q4 and have stated that for several quarters now. All the reasons you listed - they know the cost to build one, they know where they are headed, they can estimate their mix. They've been very open and have continually reiterated that. Not sure what else they can do to satisfy what you're asking for.

-Rich

Edit: Lots of additional details in Jose’s article:

https://riviantrackr.com/news/rivian-q2-2024-quarterly-update-megapost/

To clarify, I am an investor (not a speculator) in RIVN and plan to be a R1 owner once the Tri-motor Max is released and I can see how it performs in the real world. If they cannot generate cash for each vehicle produced, I probably will not be an owner. I also will lose my investment because they cannot survive like that.

So why can't they provide proof instead of promises?

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[richpike]

They can add what the margin per vehicle is as of today, and what they yet need to do to make it positive by Q4. They can provide actual data instead just promises.

Yeah - rule number one in earnings calls is give only what you must and make as few of commitments as possible. I get what you’re hoping for, but there is no benefit (to them) of doing that. Let’s hope they hit their commitment - their track record hasn’t been stellar, but I’m optimistic.

-Rich

 

[mkhuffman]

Yeah - rule number one in earnings calls is give only what you must and make as few of commitments as possible. I get what you’re hoping for, but there is no benefit (to them) of doing that. Let’s hope they hit their commitment - their track record hasn’t been stellar, but I’m optimistic.

-Rich

I am optimistic also, but I really wish they would be more transparent regarding their progress. They share a lot of data, just not that key piece.

 

[SANZC02]

To clarify, I am an investor (not a speculator) in RIVN and plan to be a R1 owner once the Tri-motor Max is released and I can see how it performs in the real world. If they cannot generate cash for each vehicle produced, I probably will not be an owner. I also will lose my investment because they cannot survive like that.

So why can't they provide proof instead of promises?

It is hard to provide proof of something that has not happened yet. All they can really offer are projections. They have provided that with current contracts the BOM savings is 20% over G1 vehicles, the mods to the build process improves throughput once ramped up by 30%, the significant losses for the write downs from the original supplier contracts as well as the penalties because of the slow COVID ramp up was almost 14k per vehicle in Q2 and should be done in Q3. Most of the pre-launch pricing is gone helping improve ASP.

There is a ton of information they have been providing but honestly if you are looking for a guarantee that all of their projections will pan out that is never going to happen. They seem to have a decent track record making their targets over the last 6 quarters, that is really all we can ask for.


Edit: You can configure the tri-motor now, looks like it starts around 106k with delivery projections in SoCal for Sept-Oct.

 

[shumdit]

One other thing besides the aforementioned early reservation holders that are costing them about half of that loss per vehicle sold is that they put a lot of incentives out there to move the remaining G1 vehicles (that were more expensive to build) so truthfully the 4th quarter report is where everyone needs to give them to get the numbers where they really should be in fairness. We have to get through one more quarter of old reservations before those early reservations are done and by then the assumption is there should be no more G1 vehicles still for sale to drag down their margins also.

 

[mkhuffman]

It is hard to provide proof of something that has not happened yet. All they can really offer are projections. They have provided that with current contracts the BOM savings is 20% over G1 vehicles, the mods to the build process improves throughput once ramped up by 30%, the significant losses for the write downs from the original supplier contracts as well as the penalties because of the slow COVID ramp up was almost 14k per vehicle in Q2 and should be done in Q3. Most of the pre-launch pricing is gone helping improve ASP.

There is a ton of information they have been providing but honestly if you are looking for a guarantee that all of their projections will pan out that is never going to happen. They seem to have a decent track record making their targets over the last 6 quarters, that is really all we can ask for.


Edit: You can configure the tri-motor now, looks like it starts around 106k with delivery projections in SoCal for Sept-Oct.

I agree with you. Promises are only as good as history proves they are, and so far, they have been fairly good at keeping the financial ones.

I am only asking for today's data. What is the cost and revenue per vehicles in production as of today. It should show good progress, but not success - yet.

 

[Dark-Fx]

Build my gen2 quad already! ?

 

[DuoRivian]

One other thing besides the aforementioned early reservation holders that are costing them about half of that loss per vehicle sold is that they put a lot of incentives out there to move the remaining G1 vehicles (that were more expensive to build) so truthfully the 4th quarter report is where everyone needs to give them to get the numbers where they really should be in fairness. We have to get through one more quarter of old reservations before those early reservations are done and by then the assumption is there should be no more G1 vehicles still for sale to drag down their margins also.

Agreed, they have consistently said Q4 is the key financial quarter - moving beyond the 2022-2024 models, the shutdown and rebuilding inventory etc. No doubt some will be on here in three months time after the Q3 figures complaining when all they have to do is wait until January.

 

[mkhuffman]

Agreed, they have consistently said Q4 is the key financial quarter - moving beyond the 2022-2024 models, the shutdown and rebuilding inventory etc. No doubt some will be on here in three months time after the Q3 figures complaining when all they have to do is wait until January.

Sure but Q3 should show good progress and there should be tangible things Rivian is planning to make Q4 what it needs to be. But if in Q3 they don't provide the data and just say "trust us"
I will be one complaining about Q3 results.

 

[BigSkies]

This is the most important information to me:
-$32,705 loss on every vehicle delivered in Q2 2024 (vs -$38,798 in Q1 2024 and -$124k per vehicle in Q4 2022).

I realize loss per vehicle in Q2 includes Gen1. The big question is: what is the loss per Gen2 vehicle? How close are they to actually producing cash for each vehicle produced?

If anyone watched, can you share if this was discussed? It seems like a question investors would ask.

I didn’t watch, but I have a finance/accounting background.

I’m honestly a bit surprised this number improved much at all given everything that was going on in Q2.

With a multi month factory shutdown they would have had inefficient labor spend, inventory write downs, capital write offs for replaced equipment, factory upgrade expenses that couldn’t be capitalized, and other things I’m not thinking of right now. The high level averages obscure a lot of things that would be happening behind the scenes.

Q3 will be much more telling.

The critical things I’ll be looking for in Q3:
-Re-affirmed full year delivery guidance
-ASP that isn’t deteriorating
-Demonstrated progress towards positive gross margin, and reaffirm Q4 positive margin guidance.

For 2025, I’d hope to see:
-A meaningful increase in deliveries. I’m assuming this would mostly be an increase in EDV’s given the R1 market seems pretty well saturated. Give us some PR to be excited about on new EDV customers.
-Sustaining positive gross margins throughout the year.
-No major deterioration in ASP outside of product mix changes.
-Continued feel-good vibes throughout the year about the R2 launch.
-More information about the Georgia factory plan and capital plans in the next few quarters.

 

[DuoRivian]

Sure but Q3 should show good progress and there should be tangible things Rivian is planning to make Q4 what it needs to be. But if in Q3 they don't provide the data and just say "trust us"
I will be one complaining about Q3 results.

Oh I don’t doubt that you would complain. Of course Rivian are doing and have done tangible things to get to their well stated goal in Q4. The larger than expected changes for the 2025 model is one tangible outcome of many decisions. The renegotiation of hundreds of contracts, as previously stated, is another example. Not sure why you don’t think they have shown tangible progress - especially when the loss per vehicle as reported has continued to drop.

 

[mkhuffman]

Oh I don’t doubt that you would complain. Of course Rivian are doing and have done tangible things to get to their well stated goal in Q4. The larger than expected changes for the 2025 model is one tangible outcome of many decisions. The renegotiation of hundreds of contracts, as previously stated, is another example. Not sure why you don’t think they have shown tangible progress - especially when the loss per vehicle as reported has continued to drop.

I am very pleased with the Gen2 changes, and I agree it is more than I expected. In fact, I agree with everything you are saying. All I am saying is they should provide the data to substantiate their claims.

How much margin improvement per vehicle are a result of the renegotiated contracts? And how much is remaining to get to a positive margin? Actual numbers. That is all I am asking for. It is math, and they have the numbers.

Most likely they feel it is too risky to share the numbers since so many changes are happening at the same time. They are public traded, and that puts a lot of legal pressure on them to be completely accurate with what they report.

So, while I am being critical, I am optimistic that there are good reasons they are not sharing, and it is not because they can't achieve the goals they have set. I just wish they would share the data.

 

[Miketz]

It's worth every penny but It is an expensive product that not many can afford. It's hard to make money operating in that space.

 

[WorldComposting]

I expected the numbers this quarter to be worse than projected due to the shutdown and unloading of the Gen 1 vehicles and agree with everyone else that the next earnings call will really tell you the future and how they are going.

Saying that I do want to add that I really think the Gen 2 vehicles are actually profitable for a couple reasons. First the Gen 1 quads are very expensive due to the Bosch motors and are being sold at a much lower price than the new quads. This included those that didn't have discounted pricing. Second is the updated pricing that adds options and increases the prices to a much higher amount for the tri motor and quad motor variants. Pricing it out the Tri motor is now more expensive than the Gen 1 quads.

So lower build cost and higher consumer price should help them reach their goal. The question is will it be enough? Either way I'm invested and hopeful they come through!

 

[RedCanyon]

You have to believe that VW got a deep dive into the numbers and seem to come to the conclusion that there was a pony in there somewhere.

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