Rivian Q2 preview: Where next for RIVN stock?

When will Rivian release Q2 earnings?

Rivian will release second quarter earnings after US markets close on Thursday August 11. The electric vehicle maker will hold an audio webcast on the same day at 1400 PT, or 1700 ET.

Rivian Q2 earnings consensus

Wall Street is looking for $337.5 million in revenue in the second quarter, an adjusted Ebitda loss of $1.23 billion and a net loss of $1.66 billion, according to the latest consensus numbers from Refinitiv.

Rivian Q2 earnings preview

All eyes are on the outlook this week after rival Lucid Group more than halved its production goal for 2022 as supply chain problems continue to bite.

Rivian is aiming to produce 25,000 cars this year and this needs to be reiterated to maintain confidence. We already know that production jumped from just 2,553 cars in the first quarter to 4,401 in the second, but it will need to more than double that run-rate if it is to succeed. Rivian needs to produce almost 18,000 cars in the second half – or 9,000 per quarter - to achieve its target, which may prove a tall order in the current climate. Any reduction to this goal will undoubtedly hurt the share price and overshadow any other positive news that may come out this week.

Focus is on supply considering it has over 90,000 net orders on its books, on top of the order from Amazon for 100,000 electric delivery vans (EDVs), although it is prioritising its R1S and R1T models over EDVs while capacity remains tight. Its factory in Illinois is now using around 75% of its capacity to produce its mainstream vehicles (with the rest being used to make EDVs) rather than the original budget of 50% as it races to fulfil orders before customers start turning to rival companies. Still, order growth will be watched to see if recent price hikes have softened demand in recent months as electric carmakers struggle to cope with inflation.

The company has budgeted $2.6 billion of capital expenditure for 2022. Rivian has said it expects to book an adjusted Ebitda loss of $4.75 billion this year, which should be closely watched to see how the carmaker is dealing with rising costs and a tough ramp-up. Investors need to be prepared to swallow even heftier losses going forward as Rivian scales up considering Wall Street currently believes it will remain in the red until 2027.

With this in mind, Rivian had almost $17 billion in cash and equivalents at the end of March, but this is expected to have dropped below the $15 billion mark by the end of June as it continues to burn through cash. Rivian has said it has a roadmap that will allow it to launch the R2 at a new factory in Georgia in 2025 using its existing cash pile. The Georgia factory will be able to produce up to 400,000 vehicles per year once fully ramped-up, making it a key catalyst that must stay on schedule after the start of production was already pushed back from 2024.

Where next for RIVN stock?

Rivian shares have risen over 73% since sinking to all-time lows back in May, although the stock appears to have hit a ceiling after climbing to $37. It has tested and failed to break this level during recent sessions and the RSI has also been pushed on to the cusp of overbought territory, suggesting it could be a tough level of resistance to crack.

The stock is targeting $42 if it can keep up the momentum before a key level of support-turned-resistance of $54 comes back into view. The 18 brokers that cover Rivian believe there is even greater upside potential with an average target price of $60, implying there is over 69% potential upside from the current share price.

Rivian shares could falter back toward $25.70 if it loses steam and comes under renewed pressure, which must hold to avoid the all-time low $19.25.

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