Rivian Q4 earnings preview: Where next for RIVN stock?

This article was republished on 4/27/2023 from our UK site, and the original posting date is listed above.

When will Rivian release Q4 earnings?

Rivian is scheduled to release fourth quarter and full year 2022 earnings after US markets close on Tuesday, February 28.

Rivian Q4 earnings consensus

Rivian is forecast to report revenue of $742 million in the fourth quarter, up from just $54 million the year before. The adjusted EBITDA loss is expected to widen to $1.49 billion from $1.10 billion while the net loss at the bottom line is set to narrow to $1.95 billion from $2.46 billion.

If Rivian meets expectations in the final three months of 2022, then the electric carmaker is on course to report annual sales of $1.73 billion, an adjusted EBITDA loss of $5.42 billion and a net loss of $6.85 billion.

Rivian Q4 earnings preview

We already know that Rivian produced 24,337 vehicles in 2022 and delivered 20,332 of them to customers. That was just below its ambition to make 25,000 vehicles during the year.

The focus this week will be on how the ramp-up will progress in 2023. Wall Street has very high expectations considering analysts forecast Rivian can produce over 64,000 vehicles and sell over 57,000 of them in 2023. There will be some fears over its target for this year after its smaller rival Lucid Group missed the mark and left investors disappointed.

Rivian warned in the last quarter that supply chain problems were making it all the more difficult to increase output, so investors will hope that there has been some improvement. Meanwhile, the lag between output and deliveries suggests logistical issues could continue to be a problem while simultaneously stoking fears over demand.

Still, Rivian has a healthy backlog of orders to work through with over 114,000 preorders for the R1 in the US and Canada alone. It also has that huge order from Amazon for 100,000 electric vans that the ecommerce giant plans to use for its delivery operations.

The concern for electric vehicle makers, which are mostly unprofitable, is that they will continue to burn through cash and find it difficult to escape the red as demand softens and a price war erupts.

Rivian had around $13.8 billion in the bank at the end of September, but it is also burning through significant amounts of cash with its free cash outflow forecast to amount to $1.96 billion in the fourth quarter.

That puts Rivian on course to have burnt through $7.39 billion in 2022. Markets hope that that 2022 will be the peak for its cash burn and that the ramp-up in production will allow it to burn through less cash in 2023 and beyond – although it is still nowhere near becoming cash generative. Rivian has said its existing cash balance means it can survive until at least 2025.

Where next for RIVN stock?

Rivian shares have fallen for six consecutive sessions and are continuing to sink toward the all-time low of $15.80 that we saw back in January. Any drop below here would open the door to unknown territory.

On the upside, the share price has found it tough to break above $21 throughout February, making this the immediate upside target. From there, it can look to recover back above $25 to recapture the floor we saw between May and July last year. Notably, this is also in-line with the 100-day moving average. It may be more difficult to climb higher from here considering the downtrend that can be traced back to last March remains intact.

However, if it can shake off the downtrend then there could be big upside potential. The 23 brokers that cover Rivian believe the selloff has been overdone and that Rivian shares can more than double, with the average target price sat at over $37.