RIVN Stock: Is Rivian on the Road to Profitability?

Rivian [RIVN] is an electric vehicle (EV) manufacturer headquartered in California. 

The company’s product lineup consists of its flagship R1T pickup truck (shown above), its R1S SUV, and an electric delivery van created in partnership with Amazon [AMZN]. 

This stock spotlight will discuss the latest developments, earnings and market performance of RIVN stock. It will also map Rivian’s road to profitability amid tariff-related uncertainties.

Key Developments: Volkswagen Deal and US Factory

Rivian entered 2025 on the back of a multi-billion-dollar joint venture (JV) deal with Volkswagen Group [VWAGY] to develop EV architecture and software services.

The deal, signed in November, will see Volkswagen Group invest up to $5.8bn in Rivian and the JV by 2027. 

An initial $1bn investment in Rivian was made in the form of a convertible note. Rivian also received $1.3bn from Volkswagen Group for intellectual property licenses as part of the JV deal.

The JV is expected to benefit Volkswagen, giving the legacy automaker access to Rivian’s proprietary EV software to accelerate its transition away from combustion engines. The first VW models to use Rivian’s electrical architecture and software are expected to arrive as early as 2027.

For Rivian, the deal brought in much-needed financial support; the company has incurred cumulative net losses of about $16.9bn over the last three years.

The JV is also expected to aid the development of Rivian’s upcoming midsize SUV model, the R2, which is slated to be released in 2026.

In the Q2 earnings update, CEO RJ Scaringe informed investors that the company will shut down its manufacturing plant in Illinois for three weeks in September to increase annual manufacturing capacity to 215,000 units from 150,000 units in preparation for R2 production.

In other news, Rivian announced in January that the company received a $6.6bn loan from the US Department of Energy to construct a second manufacturing facility in the state of Georgia.

Construction is expected to begin in 2026, with the production of customer vehicles to start in 2028.

RIVN Share Price Disappoints

Rivian went public in November 2021 at an IPO price of $78. Shares of the EV maker shot up to an all-time high of $179.47 in its second week of trading.

In the years that followed, the RIVN share price endured a prolonged slump, as the company struggled with supply chain constraints and failed to meet production targets.

RIVN stock bottomed at $8.26 in April 2024. 

As of August 12, RIVN was trading at $11.97, nearly 45% higher than its all-time low price and about 93% below its all-time high price.

The RIVN share price has performed poorly in 2025, and is down 10% year-to-date. 

EV pure play rivals such as Tesla [TSLA] and Lucid [LCID] have mirrored the market trend. TSLA and LCID shares are down 15.6% and 24.83% year-to-date, respectively.

Fundamentals: Steady Growth and Smaller Losses

In 2024, Rivian reported total revenues of $4.97bn, up 12.09% from a year ago.

Amazon was Rivian’s biggest customer, accounting for one-fifth of the company’s full-year revenue.

The company reported a negative gross profit of $1.2bn in 2024, compared to $2.03bn in 2023. The decrease was driven by the introduction of a new manufacturing technology, Rivian said. Full year net loss narrowed to $4.75bn in 2024 from $5.43bn reported in 2023.

The company saw a dip in production volumes in 2024 to 49,476 units from 57,232 units in 2023. Delivery volume increased to 51,579 units from 50,122 reported a year ago.

Rivian is only expected to deliver between 40,000 to 46,000 vehicles in 2025.

In H1 2025, Rivian posted a 7.66% year-over-year increase in total revenues to $2.54bn. H1 gross profit was nil compared to a negative gross profit of $978m a year ago. H1 net loss narrowed to $1.66bn from $2.90bn a year ago.

Rivian held cash, cash equivalents and short-term investments worth $7.51bn at the end of June 2025. Long term debt stood at $4.44bn. Interest expense came in at $141m, or 5.5% of H1 revenue.

Source: Yahoo Finance

RIVN Stock: The Investment Case

The Bull Case for Rivian: Road to Profitability

Rivian appears to be on a steady path toward turning around its business. 

The company expects to break even on a gross profit basis this year, compared to negative gross profit of $1.2bn in 2024, and is targeting EBITDA breakeven by 2027.

A shift to a new manufacturing method called “zonal architecture,” which uses fewer electronic control units and less wiring to reduce production costs, is said to be the key to this.

Meanwhile, the upcoming R2 product line is also expected to play a crucial role. 

According to Scaringe, the material cost of the R2 is “about half” that of the R1, thanks to efficient vehicle design and carefully negotiated supplier contracts.

“Simplified body architecture, simplified closures systems, further simplifications, the network architecture and associated wiring harness … in totality, what that gives us is a vehicle with a much lower cost basis, which supports the dramatically reduced pricing of R2. And of course, it should be said, R2 is a meaningfully smaller vehicle than R1,” said Scaringe during the Q2 2025 earnings call.

Bear Case for Rivian: Trump, Tariffs, Tax Credits

The outlook for EV sales in the US has turned gloomy in 2025 after the Trump administration axed the $7,500 tax credit for new clean vehicles purchases. In addition, the removal of penalties for automakers failing to meet fuel efficiency standards has eliminated demand for the EV credits that Rivian sells.

Now, increasing production cost due to tariffs is adding to Rivian’s concern.

The price of copper, an essential component of EVs, jumped to a record high in July after US President Donald Trump slapped a 50% tariff on copper imports. Similarly, steel and aluminum have been hit with 25% tariffs each.

As a result, Rivian scaled back its forecast to report a modest gross profit in 2025 due to higher costs and loss of revenue from EV credits.

Conclusion

Policy shifts, tariffs and shrinking EV incentives are threatening Rivian’s margins. 2025 could be a year of consolidation rather than expansion for Rivian. 

Meanwhile, 2026 is expected to see the release of the highly anticipated R2, a model that Rivian hopes will help the company sell “millions of vehicles per year”.