Rivian’s $170 Million Magic Trick Designed to Keep Investors From Rage-Selling—What a Joke…

Well Rivian just pulled off an impressive magic trick and not the good kind. In short, after posting its first-ever gross profit, the company simultaneously forecasted another year of billion-dollar losses. That’s right, my friends—$170 million in gross profit for Q4, but still on track to burn through another $1.7 to $1.9 billion in 2025. If that sounds like a numbers game designed to keep investors from rage-selling, then you are 100% correct. 

(Source: Giphy) 

For starters, let's hit the “profit” part of the equation. Rivian managed to squeeze out that $170 million by hacking $31,000 off the production cost of each vehicle compared to last year. That’s good. What’s even better? $299 million of its revenue came from selling regulatory credits—a nice little revenue hack (practically created and pioneered by Elon Musk of all people) where EV makers sell their environmental goodwill to legacy automakers still choking the planet with combustion engines. Throw in another $214 million from software and services, and suddenly, Rivian looks like it knows what it’s doing. Except… it doesn’t. 

Because while Rivian is patting itself on the back for trimming production costs, it’s still forecasting fewer deliveries this year. Meaning, after pushing out 51,579 vehicles in 2024, Rivian expects to deliver only 46,000 to 51,000 in 2025. So even though they’re getting better at making cars, they’re not actually selling more of them. Which is actually no bueno. 

(Source: CNBC) 

Plus, we have the massive cash burn of a $473 million net loss for Q4. The full-year loss you ask? $4.75 billion. Bigly. However, instead of pulling back, Rivian is spending even more in 2025, with capital expenditures set to hit $1.6 to $1.7 billion as it prepares to launch the all-important R2 mid-size SUV in 2026. So yes, they are relentless to make this thing work—in the meantime though, they’re also shutting down their Illinois plant for part of the year to retool. Bold move Cotton, let’s see if it pays off for ‘em. 

So with that said, what’s the big play here? Well, it’s clear that Rivian is betting pretty much everything on R2. CEO RJ Scaringe says the R2’s bill of materials will be half that of the R1, meaning it should actually make money when it sells. But that’s still at least a year away, and in the meantime, Rivian is at the mercy of EV tax credit changes, a bi-polar demand environment, and investors who are getting “this close” to running out of patience. 

(Source: Giphy) 

The good news (besides the record gross-profit which doesn’t translate to anything except losing more money)? The stock actually popped 7% after hours before investors woke up smelling the B.S. and sent shares down 4% at the time of this writing. Which means, looking ahead, I’m not really liking the stock or the hope that surrounds it (if any). 

Now obviously, do what you will with this information, but unlike some people on Wall Street—making actual money matters for a company. But then again, what do I know? I’m just the guy pointing out the obvious while every C-Suite pretends losing billions year after year is America’s favorite pastime. So yeah, in the end, place your bets accordingly and as always–stay safe and stay frosty, friends! Until next time… 

P.S. Want deep dives on the hottest AI plays before the rest of the market catches on? Want to know who’s riding the hype train and who’s actually building something that won’t collapse the second the AI bubble deflates? Want the inside track on the moves that matter before they hit the front page? Then quit playing around and subscribe to Stocks.News Premium ASAP… 

Stocks.News does not hold positions in companies mentioned in the article.