Will Rivian’s Gross Profit Be Real or Just a One-Time Boost?
There’s a rumor floating around that Rivian might report a gross profit for Q4 when they announce earnings on February 20th. But here’s the catch, it might not be because they’re actually making money on each vehicle. Word is, they’ve been sitting on a pile of regulatory credits all year and are cashing them in now to make the numbers look better.
If that’s true, it doesn’t mean Rivian has magically fixed its cost issues. They’re still spending more to build each truck than they sell it for. Sure, they’ve made progress cutting costs, but they’re not quite there yet.
The real question is whether Rivian can keep up this momentum without relying on one-time boosts. The R2 platform will help, but we still have a little bit of time to go before we see that hit the roads. Until then, they’ll need to keep squeezing out savings in production, negotiating better supplier deals, and maybe even finding ways to make money from software.
So if they do report a gross profit, don’t just take it at face value. The real test is whether they can do it again—without any financial tricks.
Money’s money. Tesla has used ZEV credits for years, turning many losing quarters profitable. They still use ZEV credits today – see 4Q earnings, to hide some of the declining revenue.
I would argue that ZEV credits never should have existed, but they do, they are real money, and why wouldn’t a company use them as needed? They are just “time-able” revenue, as opposed to selling cars, whose revenue you have to book when you sell the car.