Rivian (NASDAQ:RIVN) investors had their eyes locked on one crucial number ahead of the EV maker’s Q4 earnings: its first-ever gross profit. The company had signaled that this milestone was within reach – and it delivered. However, that didn’t help the stock much in Friday’s trading with shares skidding ~5% in the session.
Rivian reported a Q4 gross profit of $170 million, a sharp turnaround from the $606 million loss in the same period last year. The company credited the improvement to lower variable costs, higher revenue per vehicle, and better fixed cost management.
Beyond profitability, Rivian topped expectations across the board. Revenue rose by 31.1% year-over-year to reach $1.73 billion, outpacing analyst expectations by $300 million. Meanwhile, EPS of -$0.70 beat the consensus estimate by $0.07. In the quarter, Rivian also finalized its joint venture with Volkswagen and secured a loan from the Department of Energy, granting access to up to $10 billion in additional capital.
All of that, however, was deemed not good enough due to Rivian’s outlook for this year. The company expects sales of approximately 48,500 vehicles in 2025, falling short of Wall Street’s estimate of around 55,000. Last year, Rivian sold nearly 52,000 vehicles.
With shares already down 77% over the past three years, it’s been a rough ride for Rivian investors. But Canaccord analyst George Gianarikas remains bullish, seeing brighter days ahead.
“The financial breakthroughs are beginning to glimmer through. 4Q24 was the first gross margin positive quarter in the company’s history. And 2025 should continue to sustain those positive gross margins, according to management,” Gianarikas said. “There’s also still a line to EBITDA positive in 2027 as the highly anticipated R2 launches in 1H26 and the company builds volumes.”
Gianarikas believes the West needs a “strong #2 EV champion” alongside Tesla – and Rivian is best positioned to take that spot. He also sees the Volkswagen joint venture as a game-changer, helping Rivian secure capital, scale production, and position itself as the “next-gen vehicle platform of choice” outside of Tesla’s dominance.
However, it’s not all plain sailing from here; with the Trump administration reconsidering previous DOE loan commitments, Gianarikas thinks investors “need to gain clarity” on how Rivian intends to finance its Georgia facility and expand beyond an annual production capacity of 215,000 vehicles if DOE funding falls through.
Despite the uncertainties, Gianarikas is keeping the faith, issuing a Buy rating on RIVN with a Street-high $23 price target – implying a 77% upside from current levels. (To watch Gianarikas’ track record, click here)
However, the broader analyst community isn’t quite as optimistic. With a Hold (i.e., Neutral) consensus rating, RIVN’s outlook reflects a mixed bag of 10 Holds, 5 Buys, and 2 Sells. The average price target of $14.69 suggests a more tempered 13% gain over the next year. (See RIVN stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.