May 9th Earnings Call Discussion

[Milermore]

Why is the Barron's headline "Rivian’s Earnings Fell Short. The Stock Is Rising.", while Reuters says "Rivian quarterly revenue beats estimates on higher-priced EV sales" and Marketwatch says "Rivian stock jumps nearly 6% as EV maker narrows quarterly loss, keeps guidance intact"?
Are they just bearish on Rivian?

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[Redline]

"Rivian quarterly revenue beats estimates on higher-priced EV sales
May 9 (Reuters) - Rivian Automotive Inc(RIVN) beat Wall Street estimates for quarterly revenue on Tuesday as the electric-vehicle maker sold more higher-priced vehicles during the first three months of this year.
The company expects production ramp up of its in-house Enduro powertrains to help offset parts supply issues in the second half of the year, enabling it to meet its smaller-than-estimated target of manufacturing 50,000 units.
The company did not provide details of its pre-orders at the end of the quarter amid demand concerns aggravated by higher borrowing costs and industry leader Tesla's aggressive price cuts.
Tesla Inc (TSLA) has cut prices globally this year as part of its recession playbook to increase sales volumes, pressuring smaller EV players that started deliveries just about a year ago.
Amazon-backed Rivian said in March it would sell $1.3 billion in convertible green bonds due in 2029 to shore up its cash balance. Analysts view it as a temporary fix.
Revenue for the quarter ended March 31 stood at $661 million, compared with Wall Street estimates of $652.1 million, according to Refinitiv data.
The company reported a net loss of $1.35 billion for the first three months of the year, compared with a loss of $1.59 billion a year earlier.

Cash and cash equivalents at the end of the first quarter were $11.24 billion, compared with $11.57 billion, in the preceding three-month period."

When they lose $1.35 billion in Q1, yet cash remains largely unchanged at 11.24 billion ... I'd want to know why. Did they go into even more debt to pull that off, reduce inventories or what?

In addition to our operational progress, we recently took steps to further strengthen our balance sheet. During the first quarter of 2023, we issued green convertible senior notes which generated proceeds of approximately $1.5 billion, and in mid-April, we announced amendments to our asset-based revolving credit facility which doubles the available revolving commitments to $1.5 billion and includes other amended terms. In aggregate, these transactions have increased Rivian’s liquidity profile by approximately $2.4 billion.

 

[DuoRivians]

I get the feeling they're sandbagging the 50k number.

Yep. But they learned their lesson from 2022.

 

[DuoRivians]

Why is the Barron's headline "Rivian’s Earnings Fell Short. The Stock Is Rising.", while Reuters says "Rivian quarterly revenue beats estimates on higher-priced EV sales" and Marketwatch says "Rivian stock jumps nearly 6% as EV maker narrows quarterly loss, keeps guidance intact"?
Are they just bearish on Rivian?

Because Al Root is a $tsla simp and to him, everyone else is just trash.

 

[Franksmartin]

thats the whole point of the R2, its supposed to be their higher-margin vehicle so doesn't make sense to call that a non-starter.

When did they say R2 would be higher margin?

 

[clcbjc123]

I think profitability becomes better in 2024 when they are post March preorders.

 

[junkanoo]

In addition to our operational progress, we recently took steps to further strengthen our balance sheet. During the first quarter of 2023, we issued green convertible senior notes which generated proceeds of approximately $1.5 billion, and in mid-April, we announced amendments to our asset-based revolving credit facility which doubles the available revolving commitments to $1.5 billion and includes other amended terms. In aggregate, these transactions have increased Rivian’s liquidity profile by approximately $2.4 billion.

Thanks for that. So ... taking on yet more debt is now increasing one's "liquidity profile." I guess if that's the best spin you've got ... go with it.

So ... just know Dear Stockholders that if those senior notes get converted down the road, your shares get diluted and if they go belly-up, Senior debt holders get paid first.

Looks like Rivian has until 2025 before they will need to seek a suitor. Meanwhile, their Georgia plant isn't scheduled to begin production until 2026.

 

[Redline]

I think profitability becomes better in 2024 when they are post March preorders.

Yep...it seems they are trying to find a good mix rate right now with those of us before the increase and those after.

I know I was bumped a little, but recently moved back into this year (7/21 preorder) but I understand as a shareholder.

 

[itselectric]

RJ's answer on backlog... a bit of a deflection.

They need the single motor standard pack config out in 2024 to help get MSRP down so it is accessible to more buyers is what I heard. No surprise given interest rates and the market right now.

No price cuts coming it sounds like, maybe slight increases depending on how things go...

Also seems R1 v1.2 is coming out later this year as well.

The guy asking about "de-content" ugh...

 

[dleewla]

When did they say R2 would be higher margin?

yeah youre right, not higher margins. sorry i meant more profitable by scale as opposed to the R1 which is more niche. but my point is that they key to Rivian's long term success/survival will be vehicles, like the R2, they can sell in way larger numbers than the R1. so they really do need to focus on that, which i think they are.

 

[Redline]

RJ just said they'd be through pre March increase orders in a year.

 

[MidnightRivian]

RJ's answer on backlog... a bit of a deflection.

They need the single motor standard pack config out in 2024 to help get MSRP down so it is accessible to more buyers is what I heard. No surprise given interest rates and the market right now.

No price cuts coming it sounds like, maybe slight increases depending on how things go...

Also seems R1 v1.2 is coming out later this year as well.

The guy asking about "de-content" ugh...

Can you give more details on R1 v1.2 coming out later this year?

 

[1T2022]

Barron is moron

 

[itselectric]

Can you give more details on R1 v1.2 coming out later this year?

Nothing specific was given. They mentioned a number of things they are working on, some are cost related but they also mentioned updating technology. That was about it.

Some changes sound early next year, but other comments alluded to "towards the end of the year" but I assume they want that close to the vest.

It doesn't sound like they are going to de-content the heck out of the vehicle, they want to keep it premium, for now.

 

[jeeden]

Thanks for that. So ... taking on yet more debt is now increasing one's "liquidity profile." I guess if that's the best spin you've got ... go with it.

the Federal reserve has entered the chat: yes, yes it does.

Hehe... This is no more speculation then any other companies earnings. Taking on more debt is what allowed Ford to march down during the cash for clunkers era and tell Congress they didn't need their help because they had secured more debt and therefore were more liquid during 2008 recession.

Up until recently Facebook was losing the equivalent of flying an Airbus A380 Emirates build out interior into a mountain every quarter on metaverse and nobody bats an eye as long as the POTENTIAL is there to make some money in the future (their stock was down, but nobody was running for the exists and they all started betting on how much profit there would be when they stopped loosing money on metaverse)

I believe the market did and will continue to reward them for that spin

Note: I'm bullish on rivian.and think it was a good move.

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