Rivian Faces Delivery Drop but Posts First-Ever Gross Profit Amid Market Challenges

Rivian (NASDAQ:RIVN) expects a decline in electric vehicle deliveries for 2025 but projects a modest gross profit as it cuts supply chain and raw material costs. The EV industry is grappling with weak demand as consumers opt for gas-powered cars amid economic and political uncertainty.

The Trump administration’s proposed tariffs on Mexico and Canada could raise costs for Rivian, which relies on supply chains in both countries. CEO RJ Scaringe noted that uncertainty in trade policies may impact consumer behavior and revenue.

Despite these challenges, Rivian reported its first-ever quarterly gross profit of $170 million, a significant turnaround from its $606 million loss a year earlier. The company delivered 51,579 vehicles in 2024 and now expects 2025 deliveries between 46,000 and 51,000, falling short of analysts' projections of 55,520 units.

Rivian plans to halt production for a month in late 2025 to prepare for the launch of its highly anticipated R2 model, aimed at competing with Tesla’s (NASDAQ:TSLA) Model Y. The EV sector remains volatile, with Tesla posting its first annual sales decline in 2024 and electric truck maker Nikola (NASDAQ:NKLA) filing for bankruptcy.

The company exceeded revenue expectations, posting $1.73 billion for Q4, surpassing analysts’ $1.4 billion estimate. Its software and services division doubled its revenue to $214 million.

Rivian also expects $2 billion in revenue over four years from its joint venture with Volkswagen (ETR:VOWG_p), which invested $5.8 billion in the EV maker to co-develop software and electrical architecture.

Shares initially jumped 7% in extended trading before settling at a 1% gain. Investors remain cautious as Rivian navigates economic pressures, supply chain risks, and evolving government policies.