Rivian (RIVN) First Quarter Results Ahead: What’s In Store? – May 9, 2022

Rivian Automotive (SHORE Free Report) is expected to release first quarter 2022 results on May 11, after the closing bell. Zacks’ consensus estimate for losses and earnings for the quarter is pegged at $1.50 per share and $113.6 million, respectively. The consensus mark for Rivian’s first-quarter loss per share has widened 6 cents over the past 30 days.

The electric vehicle (EV) startup went public in November 2021. This will be the third time the company has released quarterly results after debuting on the Nasdaq. Over the past two quarters, RIVN has exceeded earnings estimates once and missed the other, with the average negative surprise being 9.12%. In the last reported quarter, Rivian suffered a loss per share of $2.43, higher than Zacks’ consensus estimate of a loss of $1.58. Total revenue came in at $54 million, surpassing the consensus mark of $50 million.

Factors Affecting First Quarter Results

In the first quarter of 2022, Rivian produced 2,553 vehicles at its Illinois manufacturing facility. The company delivered 1,227 vehicles in the first three months of 2022 and believes it is on track to meet its sales forecast of 25,000 units this year. But supply chain hurdles, compounded by the Russian-Ukrainian war and the resurgence of the coronavirus in China, are believed to have led to a loss in sales volumes in the quarter ahead.

Additionally, RIVN – being in the nascent stage of development – has been burning money. In the most recently reported quarter, Rivian’s research and development (R&D) costs roughly tripled from prior year levels, while selling, general and administrative (SG&A) expenses nearly seven-fold increased by compared to the corresponding quarter of 2020. Operating expenses amounted to $2,071 million, up from $353 million incurred during the comparable period of the previous year. Massive operating costs in the first quarter, stemming from advanced product development activities, should have weighed on margins. Additionally, high capital expenditure to support additional manufacturing capacity and infrastructure is likely to have reduced cash flow. This becomes more glaring, especially when the business does not generate significant revenue.

Rivian’s overall results are likely to be weighed down by supply chain issues, manufacturing inefficiencies, high operating costs and capital investment requirements.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for Rivian this time around. The combination of a positive earnings ESP and a Zacks rank of #1 (strong buy), 2 (buy), or 3 (hold) increases the chance of an earnings beat, which is not the case here.

ESP Earnings: Rivian has an ESP on earnings of -8.38%. Indeed, the most accurate estimate of the loss is 13 cents wider than the Zacks consensus estimate. You can discover the best stocks to buy or sell before they’re flagged with our earnings ESP filter.

Zacks Rank: Rivian currently carries a Zacks rank of 3. You can see the full list of today’s Zacks #1 Rank stocks here.

Peer publications

Lucid Group (LCID Free Report) suffered an adjusted loss of 5 cents per share in the first quarter of 2022, narrower than Zacks’ consensus estimate of a loss of 30 cents. Net income also compares favorably to the adjusted loss of 37 cents per share in the fourth quarter. For the first quarter of 2022, the company reported revenue of approximately $58 million. Total costs and expenses totaled $655.2 million, compared to $299.1 million in the prior year quarter. LCID incurred $185 million in capital expenditures.

Lucid ended the quarter with cash and cash equivalents of $5.4 billion. The company delivered 360 Lucid Air cars in the first quarter. As of May 5, it had taken more than 30,000 customer reservations, reflecting potential sales of more than $2.9 billion. LCID envisions Lucid Air production in 2022 in the range of 12,000 to 14,000 units.

Nikola Corp. (NKLA Free Report) suffered an adjusted loss of 21 cents per share in the first quarter of 2022, narrower than Zacks’ consensus estimate of a loss of 27 cents. Net income also compares favorably with the adjusted loss of 23 cents per share in the fourth quarter. NKLA generated just $2 million in revenue during the quarter under review. In the first quarter of 2022, the company spent a total of $151 million on R&D and SG&A activities.

NKLA had cash and cash equivalents of $360 million as of March 31, 2022. Nikola aims to deliver 300 to 500 production Tre BEV trucks this year. It also intends to launch the construction of its first hydrogen production hub in Arizona.