The Moment of Truth

The Moment of Truth

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EV maker Rivian (RIVN, $38.95) announced its earnings, reporting a wider operating loss than expected and news that most of its newer models are being exempt from new federal tax exemptions. Nevertheless, they aim to deliver their target of 25,000 vehicles by the end of the year with an added cash burn of $700 million.

In Q2, Rivian lost $1.71 billion and delivered 4,467 vehicles, including its SUV and truck, as well as the Amazon delivery vans. It burned through $1.2 billion in the quarter, leaving it with $14.9 billion in cash – enough to cover the $5 billion earmarked to open its second U.S. assembly plant. 

Despite the negativity, Rivian still cruised past analysts' expectations on revenue, bringing in $364 million in Q2 – about $26 million more than analysts anticipated.

Why it matters

Rivians cash burn is hardly a new trend within the EV market, however its desire to hit manufacturing targets (at a massive loss) is somewhat commendable. Rivian like its counterparts blamed the hike and costs on several factors, including "supply chain challenges" and "raw material inflation." Case in point, rival Lucid Motors slashed production targets due to bottlenecks.

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