Earnings call transcript: Rivian Q2 2025 shows revenue stability, EPS miss

Rivian Automotive Inc. reported its second-quarter earnings for 2025, revealing stable revenue figures but a wider-than-expected loss per share. The electric vehicle maker posted a consolidated revenue of $1.3 billion, in line with forecasts, but its earnings per share (EPS) came in at a loss of $0.97, significantly missing the forecasted loss of $0.66. Despite the earnings miss, Rivian’s stock showed resilience, with a slight uptick in after-hours trading, closing at $12.49, a 0.64% increase from its last close of $12.41. According to InvestingPro data, the company maintains a FAIR overall financial health score of 1.89, with notably strong liquidity metrics. Get access to 10 key ProTips and comprehensive analysis in the Pro Research Report.

Key Takeaways

• Rivian’s Q2 revenue met expectations at $1.3 billion, with automotive revenue contributing $927 million.
• The company reported a larger-than-expected EPS loss of $0.97 against a forecast of $0.66.
• Rivian’s stock saw a minor increase of 0.64% in after-hours trading, closing at $12.49.
• The company is focusing on future growth with the launch of the R1 Quad Motor and preparation for R2 production.
• Rivian received a $1 billion investment from Volkswagen Group, bolstering its financial position.

Company Performance

Rivian’s performance this quarter highlights its steady revenue stream but also underscores challenges with its profitability. The company produced 5,979 vehicles and delivered 10,661, reflecting its ongoing efforts to scale production. InvestingPro data reveals a concerning gross profit margin of -9.33% in the last twelve months, though the company maintains a strong current ratio of 3.73, indicating solid short-term financial stability. Despite a gross profit loss in its automotive segment, Rivian continues to lead the premium SUV market in key states like California and Washington.

Financial Highlights

• Revenue: $1.3 billion, unchanged from forecasts.
• Automotive Revenue: $927 million.
• Software and Services Revenue: $376 million.
• EPS: -$0.97, missing the forecast of -$0.66.
• Adjusted EBITDA Losses: $667 million.
• Cash and Equivalents: $7.5 billion.

Earnings vs. Forecast

Rivian’s EPS for Q2 2025 was a loss of $0.97, significantly missing the forecast of a $0.66 loss. This 46.97% surprise reflects greater-than-anticipated challenges in managing costs and achieving profitability. However, revenue met expectations, indicating stable demand for Rivian’s vehicles.

Market Reaction

Following the earnings release, Rivian’s stock experienced a slight increase in after-hours trading, rising by 0.64% to $12.49. With a beta of 1.81, the stock has shown significant volatility, and analysts maintain a moderate outlook with price targets ranging from $7.05 to $23.00. This movement suggests that investors may be focusing on the company’s long-term growth prospects and recent strategic investments, despite the earnings miss. InvestingPro subscribers can access detailed analyst consensus data and comprehensive valuation metrics to make more informed investment decisions.

Outlook & Guidance

Looking forward, Rivian is targeting an EBITDA breakeven by 2027, with plans to expand its manufacturing capabilities in Georgia. The company’s current EBITDA stands at -$2.91 billion, while maintaining $7.5 billion in cash against $4.87 billion in total debt. The company is also preparing for the production of its R2 model, expected to have a positive gross margin. Rivian’s guidance includes an expectation of 40,000 to 46,000 vehicle deliveries for 2025. Discover more detailed financial metrics and exclusive insights with an InvestingPro subscription.

Executive Commentary

CEO RJ Skirinj emphasized the strategic importance of the R2 model, stating, "R2 is a core focus for our team and a critical step to achieving our objective of delivering millions of vehicles per year." He also highlighted the company’s autonomy ambitions, noting, "By later this decade, we believe ultimately every new vehicle will need advanced levels of autonomy to be successful."

Risks and Challenges

• Continued profitability challenges, as evidenced by the wider-than-expected EPS loss.
• Regulatory and policy hurdles in the EV market, affecting operations and strategy.
• Potential supply chain disruptions as the company scales production.
• The need for significant capital investment to support growth and innovation.
• Competitive pressures in the rapidly evolving electric vehicle market.

Q&A

During the earnings call, analysts inquired about Rivian’s cost reduction strategies for the R2 model and how the company plans to navigate policy impacts on its business. Executives addressed these concerns by detailing their autonomy development plans and market positioning for the R2, which is expected to play a pivotal role in Rivian’s growth trajectory.

Full transcript - Rivian Automotive Inc (RIVN) Q2 2025:

Call Moderator: Welcome to today’s Q2 Earnings Results hosted by Rivian. At this time, all participants are in a listen only mode. After the speakers’ presentation, we will conduct a question and answer session. I’ll now turn the call over to Derek Mulvey, Vice President of Finance.

Derek Mulvey, Vice President of Finance, Rivian: Good afternoon, and thank you for joining us for Rivian’s second quarter twenty twenty five earnings call. Today, I am joined by RJ Skirinj, our CEO and Founder Claire McDonough, our Chief Financial Officer and Javier Varela, our Chief Operations Officer. Before we begin, matters discussed in this call, including comments and responses to questions, reflect management’s views as of today. We will also be making statements related to our business, operations and financial performance that may be considered forward looking statements under federal securities law. Such statements involve risks and uncertainties that could cause actual results to differ materially.

These risks and uncertainties are described in our SEC filings and the shareholder letter we filed with the SEC. During this call, we will discuss both GAAP and non GAAP financial measures. A reconciliation of historical non GAAP to GAAP financial measures is provided in our shareholder letter. Just before the earnings call, we published and filed our shareholder letter, which includes an overview of our progress over the recent months. I encourage you to read it for additional details around some of the items we will cover in today’s call.

With that, I’ll turn the call over to RJ, who will begin with a few opening remarks.

RJ Skirinj, CEO and Founder, Rivian: Thanks, Derek. Hello, everyone, and thanks for joining us today. Over the past few months, we’ve made tremendous progress in R2 and our technology, including our autonomy platform. As we move closer to the start of production, our confidence in R2 and future variance underscores our long term vision for scaling our business. We believe the technology and products we’re developing will position Rivian as a market share leader.

Our long term view on electrification and the opportunity in front of us remains the same. However, there have been changes in the external operating environment that affect the nature of this transition. While we believe deeply in the long term value drivers of our business, the policy environment continues to be complex and rapidly evolving. Changes to EV tax credits, regulatory credits, trade regulation and tariffs are expected to have an impact on the results and the cash flow of our business. We remain focused on developing world class technology and efficiently scaling our manufacturing capacity in The United States in light of these policy changes.

As we look ahead, Rivian shares the administration’s excitement in advancing technology development and manufacturing capacity within The United States. With all that said, having spent a lot of time driving R2, I’m more bullish on this vehicle than any product we’ve developed. I believe the product market fit is incredible, the packaging, the technology and overall value proposition set R2 up for meaningful share. R2 is a core focus for our team and a critical step to achieving our objective of delivering millions of vehicles per year. We are currently in midst of our design validation builds where we’re building our two vehicles on our pilot line.

These vehicle builds enable us to validate the performance and capabilities of the full vehicle along with working with our suppliers on the ramp. Importantly, the quality of the build and associated software software stability is incredibly high. We strategically invested in early development assets and mule vehicles, which allowed us advanced development and supplier validation much earlier in the time line as compared to r one. We performed a variety of crash tests and component level tests as well as on road testing with strong results. In preparation for our manufacturing validation builds later this year, we’ve completed the construction of our new 1,100,000 square foot building in Houma, Illinois, which will house R2’s general assembly and body shop.

Our team is focused on installing and validating the equipment to support the manufacturing validation builds. In parallel to the progress we’re making on R2, we continue to make improvements in AI and autonomy. We see autonomy as becoming increasingly important in a customer’s purchase decision. By later this decade, we believe ultimately every new vehicle will need advanced levels of autonomy to be successful. Because of this, the development of our Rivian autonomy platform has been one of our most substantial and important focus areas.

Our platform uses the high quality data coming from our best in class onboard sensor set to drive our data flywheel for training our Rivian large driving model. We’ve already seen positive feedback from customers on some of the growing autonomous capabilities. We launched enhanced highway assist earlier this year and are seeing meaningful uptake in the usage of our autonomy platform. With our high quality sensor set and a large amount of data collected from our vehicles every day, we believe we have the right ingredients to quickly establish leadership in the space. We plan to host our autonomy and AI day in December and look forward to sharing the progress we’ve been making.

While we approach some exciting releases across R2 and our autonomy platform, last month, we also launched the R1 quad motor, and the feedback has been incredible. We believe the quad elevates our R1 platform, which is already one of the best selling vehicles in its class. The customers, journalists, and influencers have had a chance to drive the new Quad, are seeing the unique combination of on and off road performance, advancements made with our Rivian autonomy platform, and software features that allow you to customize dynamics with our RAD tuner. With the progress demonstrated this quarter, I can’t wait for our autonomy and AI day, the launch of R2 and the realizing of our long term scale potential with our midsized platform. I want to thank our employees, customers, partners, suppliers, communities and shareholders for their support.

With that, I will pass the call over to Claire.

Claire McDonough, Chief Financial Officer, Rivian: Thanks, RJ. I want to echo our excitement for the upcoming launch of R2 and our autonomy and AI advancements. It is great to see our vertically integrated technologies go into our design validation builds for R2. This is a key driver of the structural cost advantages we expect to achieve on R2 while also delivering fantastic performance and utility. During the second quarter, we produced 5,979 and delivered 10,661 vehicles from our manufacturing facility, which was the primary driver of the $927,000,000 of automotive revenue.

We saw a significant decrease in production volume compared to the first quarter as a result of a variety of supply chain related complexities, partially driven by shifts visibility into these components for the remainder of the year. Automotive gross profit in the second quarter was negatively impacted by lower production volumes, which resulted in approximately $137,000,000 of fixed cost included in cost of revenues as compared to more normalized volumes. Automotive gross profit losses were $335,000,000 Our Software and Services segment reported another strong quarter with $376,000,000 of revenue and $129,000,000 of gross profit. About half of the revenue within Software and Services was a result of the Software and Electrical Hardware joint venture we created with Volkswagen Group. We also experienced strong growth in gross profit contribution from remarketing, service, accessories and charging.

Our consolidated revenue was $1,300,000,000 and gross profit losses were $2.00 $6,000,000 Included in this was $185,000,000 of depreciation and $37,000,000 of stock based compensation expense. Adjusted EBITDA losses for the quarter were $667,000,000 We saw a slight increase in overall operating expenses in the second quarter as compared to the first quarter, driven by the ongoing investments we’re making to develop and our key technologies as well as the continued growth of our sales and service infrastructure and organization. We expect to see increasing operating expenses in the second half of the year as we advance R2 towards production and continue the build out of our sales and service infrastructure to support R2’s volumes. During the second quarter, we also strengthened our balance sheet. On June 30, we received a $1,000,000,000 equity investment from Volkswagen Group at an effective price per share of $19.42 which represents a 33% premium to the $14.56.30 trading day volume weighted average stock price.

During the second quarter, we also refinanced our senior secured notes due October 2026 by issuing $1,250,000,000 of green secured notes at a rate of 10% maturing January 2031. In addition to the $7,500,000,000 of cash and cash equivalents and short term investments reflected on our balance sheet, we expect to receive up to an additional $2,500,000,000 of incremental capital associated with our joint venture transaction as well as an up to $6,600,000,000 loan from the Department of Energy associated with the build out of our Georgia facility. Turning to our 2025 guidance. We are maintaining our delivery guidance of 40,000 to 46,000 vehicles and our CapEx guidance of 1,800,000,000 to $1,900,000,000 As a reminder, we plan to shut down our normal facility for approximately three weeks starting in September to prepare for the planned launch of R2 in the 2026. We anticipate the third quarter to be our peak delivery quarter of the year across both consumer and commercial vehicles.

As RJ mentioned, while we believe our long term opportunity to drive meaningful growth and profitability remains strong, some of the recent policy actions will have an impact on our results and cash flow of our business. This includes increased tariffs, which had a minimal impact during the second quarter but are expected to have a net impact of a couple thousand dollars per unit for the remainder of 2025. In addition, due to changes in certain regulatory credit programs, we do not expect to earn revenue from these programs for the remainder of 2025. We expect total 2025 regulatory credit sales to be approximately $160,000,000 as compared to our prior outlook of $300,000,000 As a result of the changes in our regulatory credit outlook, in addition to our second quarter results, we expect our gross profit for the full year 2025 to be roughly breakeven. We are also increasing our guidance for our adjusted EBITDA loss to $2,000,000,000 to $2,250,000,000 as a result of the modifications to our gross profit outlook.

Our focus remains on cost optimization and efficiently scaling the business. We are actively studying tariff mitigation strategies to best position the company, especially as we look ahead to the Section two thirty two automotive tariff offset, which ends in April 2027. We remain steadfast in our belief that R2 and our technology development will be truly transformative for our growth and profitability. I’d like to turn the call back over to the operator to open the line for Q and A.

Call Moderator: For the Q and A section of today’s session, we’ll be utilizing the raise hand feature. If you’d like to ask a question, click on the raise hand button at the bottom of the screen. Once prompted, please unmute yourself and begin with your question. As a reminder for today’s call, we will allow one question and one relevant follow-up. We will now pause a moment to assemble the queue.

Our first question will come from Dan Levy with Barclays. Your line is open. Please ask your question.

Dan Levy, Analyst, Barclays: Hi. Good evening. Thanks for taking the questions. I want to start with a question I think that’s probably on everyone’s mind, which is just bridging from r one to r two. And I and I think the obvious key here is the cost reduction.

You’re saying you can cut the cost by more than half. But maybe you can just remind us again, you know, about what are the things in r one that won’t recur? And, you know, on the flip side, you’re talking about things like sourcing and contracts that can help on r two. What is the conviction that you can get the required cost reduction from these items to get appropriate economics on R2?

RJ Skirinj, CEO and Founder, Rivian: Thanks, Dan, for the question. This is incredibly important and has been an absolute core focus for us as a business as we’ve been developing R2. And, you know, if you think about the cost on the vehicle, there’s there’s two major drivers. The first is our bill of material costs. So it’s the cost we’re paying all of our suppliers for the components going into the vehicle.

And cost of those components reflects how the vehicle is being designed, how the systems are being integrated. And we talk a lot about this, but our success in either consolidating parts or eliminating parts through design is a big enabler here. And we’ve previously said the bill of material cost on R2 is about half that of R1. And that’s not a hope, that’s not a wish, that’s actually contractually negotiated with suppliers. And so we’ve spent the last two years development and time negotiating with suppliers to put in place contracts that we both selected suppliers that can scale with us and ramp appropriately, but also can deliver a much lower cost structure.

But linked to that, of course, is then how the vehicle assembles. And so the cost it takes us to convert all those parts into a vehicle, what we often call conversion cost, And then some of the nonbilling material COGS, you know, that’s logistics, that’s warranty accrual, that’s some of the other items that feed in. And here, Claire and I both spoken about this. Claire, Javier and I have spoken about this on these calls before, where we’re projecting with a lot of confidence that, that will be ultimately less than half of what it is on R1. And that’s really reflective of an incredible, you know, incredibly high focus on ease of assembly, design for manufacturability, leveraging the many, many learnings that were born out of what we went through on R1.

So simplified body architecture, simplified closures closure systems, further simplifications, the network architecture and associated wiring harness. And 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. It does deliver on the brand promise of Rivian, but it we’ve been very thoughtful on some of the content decisions we’ve made where it’s not as extreme in terms of performance or capability as what you see in R1.

Javier Varela, Chief Operations Officer, Rivian: And if I may add, RJ, today, we have the r 200% sourced. So it’s a fact. We we we we we know the prices of our components, and we can confirm this 50 percent reduction.

Dan Levy, Analyst, Barclays: Okay. Great. Thank you. As a follow-up, I think related, a year ago at your Investor Day, you outlined a path to EBITDA breakeven in 2027. We’ve obviously seen a number of changes since then with, you know, lower regulatory credit environment as you’re talking about, tariffs, the the loss of the EV tax credit.

So question is is what are the areas in which you need to pivot the business now to still see that path to eventually reaching EBITDA positive, and how much more does this make licensing deals, other partnerships with with automakers on the tech side more of a a necessity to ultimately get to where you need to be on the EBITDA margin side?

Claire McDonough, Chief Financial Officer, Rivian: Thanks, Dan. As as you know, our objective is to drive to positive EBITDA as a result of the full year r two production and strong software and services performance that are anticipated as we look ahead to 2027. And so as you look at the relative contributing factors there, while there certainly have been meaningful headwinds as we look at some of the policy implications, that are in play today relative to the conversation that we had about a year ago as part of our investor day, we’re working across a number of cost efficiency initiatives in the business to drive and scale the business as efficiently as as possible. And maybe I’ll invite RJ to to talk to some of the opportunities as we think about the continued growth and development of our software and services and future opportunities with other potential OEMs as well.

RJ Skirinj, CEO and Founder, Rivian: Yeah. We talk a lot about R2 as being such an important inflection point for us in terms of volume and scale. And of course, along with that, significantly widening the aperture of addressable market with its lower price point. But a lot of what feeds into that is the technology we’re developing. And on the vehicle software side of things, of course, we have a joint venture and and software licensing deal that we put together with Volkswagen Group that continues to progress really nicely.

And to be able to deploy our software stack and associated topology of of ECUs across such a wide range of vehicles in terms of price point, configuration and market with Volkswagen Group really serves as an outstanding demonstration and really existence proof that we as a company are able to do that into a complex, large existing business. And so certainly, we do believe there’s opportunities above and beyond the relationship with Volkswagen Group for further licensing of our software and technology. And then beyond that, we also see opportunities emerging with a lot of the work that we’re doing in our autonomy stack. And we’re investing very heavily into that. As I said in my opening statement, this is an area of the business that we’re very excited about.

Customers are going to start to see the fruit of a lot of this hard work that’s gone in, in terms of building a robust data flywheel. We put onto our Gen two R1 vehicles a world class sensor set with more megapixels of cameras than any other vehicle on the road in North America. We couple that with an outstanding imaging radar and that’s feeding a really powerful data training flywheel that’s going to start to really show demonstrate significant capabilities in terms of higher levels of autonomy. And so we do see that as another avenue for us in the long term. But, you know, core to all that is to make sure that the technology we’re developing, you know, vertically in house with our teams remains really front of the curve.

And if we continue to do that as we have, we do think there’s a lot of opportunities there as well.

Dan Levy, Analyst, Barclays: Great. Thank you.

Call Moderator: Our next question will come from Adam Jonas with Morgan Stanley. Your line is open.

Adam Jonas, Analyst, Morgan Stanley: Hi. Thanks, everybody. My first question is on the $6,600,000,000 loan with the Department of Energy that’s associated with the build out of Georgia. Can you confirm, has any of that loan been drawn? And is there a is there a scenario where you would decide not to draw on that loan?

Because by the by the from the readings of the of the shareholder letter, I don’t see much of an update on on CapEx, going into that, into the build out at this point. But just maybe kinda where are we on that? What’s your thinking on that loan? And then I have a follow-up.

Claire McDonough, Chief Financial Officer, Rivian: Sure. Thanks, Adam. So as it pertains to the Department of Energy loan, it’s it’s more of a construction finance project finance based loan, and so it does require Meridian to be deploying capital on-site in Georgia. We have not yet started construction of the site, and so that precludes us from having the opportunity to to draw on that loan, as as we sit here today. And we I as we look at the the future road map, the attractive cost of capital that the Department of Energy loan for Rivian is something that’s quite attractive to us.

So we do intend to, draw on that loan as as we look to expand our manufacturing base in in Georgia.

Adam Jonas, Analyst, Morgan Stanley: Okay. Thanks, Claire. Just as a follow-up, you you spun off Also Inc. In March, your micromobility unit. You seem to have attracted some pretty serious talent to that unit as well, and I think there’s probably more more announcements to come there, I would assume.

Aside from the minority stake held by Rivian, and maybe you can confirm how big that is, is there any other relationship between Rivian and also, Inc? And and how much time, RJ, are you spending on this entity, with your current role as chairman? Thanks.

RJ Skirinj, CEO and Founder, Rivian: Yeah. Thanks, Adam. We we had a Skunk Works project within Rivian that was looking at essentially to the question of how do we electrify the world, what’s necessary. And a natural conclusion of that is, of course, there’s markets like The United States and Europe that are very vehicle centric. But not only within those markets, but beyond those markets, much of the world moves on things that look very different than cars.

So two wheel, three wheel, even four wheel quadricycle type products. And so the initial effort that when it was housed within Rivian was to look at ways that we could take this technology base that we developed and apply it into the micromobility segment. As we were doing that, we realized the market opportunity was very significant and, in fact, bigger than we had originally anticipated. And took the decision to move that outside of Rivian, where Rivian is still a significant shareholder, but allow it to secure outside capital and allow its brand trajectory and company trajectory to look at markets differently, positioning differently than the Rivian product line. And what’s been really interesting is just the scale of that in terms of what it represents in number of vehicles is really exciting.

And so Rivian, as you said, is still a very significant shareholder, just under 50% ownership in this entity. But we continue to have a lot of the technology that also is using leverages some of the core of what Rivian built. And, you know, when you think of the the opportunity, I think there’s there’s going to be ways that we can be really creative where we see the Rivian product line and the Also product line coming together. We often think about them as two Avengers who are both fighting on the for the same mission. If you if you want to electrify the world, of course, Rivian is part of that.

We hope to inspire competition in the in the vehicle space. But but we also, hence the name, we also need to electrify a lot of other things, two, three, four wheeled things. And and that’s that’s why that company exists.

Call Moderator: Our next question will come from Mark Delaney with Goldman Sachs. Your line is open.

Mark Delaney, Analyst, Goldman Sachs: Yes. Good afternoon. Thank you very much for taking the questions. I think Rivian’s COGS per vehicle went up about $22,000 sequentially. Can you elaborate more on what drove that and to what extent these are temporal relative to sustained costs?

And then you spoke about taking costs down by more than 50% with R2 compared to the R1. So I’m hoping to better understand if there are some sustained higher cost levels you’re seeing with the R1. Does that change the absolute cost that you expect R2 to come in at?

Claire McDonough, Chief Financial Officer, Rivian: Sure. As you think about the drivers of the cost of goods sold per unit from Q1 to Q2, The largest driver is, as we mentioned in our in our prepared remarks, was driven by the lower production volume and therefore the lack of fixed cost leverage that we had, absorbing those costs into, you know, inventory, so to speak. So that was represented about, you know, $14,000 a unit of of impact. We also had, you know, higher, levels of LCNRB, in this period as well as some, you know, warranty and and other related costs that constituted the other increases in COGS per unit for the automotive segment for Q2 relative to Q1. So as we take a step back and look at the Q1 baseline, we we do see that as a, you know, helpful starting point of demonstrating the opportunity set that we have with r one with higher levels of production volumes.

However, that q one COGS per unit doesn’t include the impact from, tariff related costs, which you mentioned are roughly about a couple thousand dollars a unit that we’ll begin to see, more so in the second half of of this year as as well. And so as we look at the r two cost structure, we do have, similar impacts as as we think about, the tariff impacts on r two on a go forward basis. However, one of the core benefits that we have in in r two, and hopefully in the future, we’ll we’ll r one will benefit from as well is is some of the, joint ventures shared sourcing opportunity as we think about the low voltage electronics that will be shared between, you know, Rivian vehicles and R2 vehicles in the the future, which were, you know, in market sourcing currently, and and that can produce incremental upside as we think about the the COGS road map for R2.

RJ Skirinj, CEO and Founder, Rivian: Yes. As Clairv said, the production volume output of Q2 going from in Q1, you know, 14,000 units to Q2 being around 6,000 units, The lack of fixed cost absorption, you can really see it in the numbers. And as we said, that was reflective of a lot of the supply chain environment that we’re in and some of the trade related and tariff and export control related items that we encountered in Q2. But an important point to call out here is that as we launch R2, the benefits of fixed cost absorption, will be felt not just by R2 but carrying that across R1, we’ll also start to see. And this is really important for us as we grow volume in the plant in our normal Illinois production facility going into 2026.

Mark Delaney, Analyst, Goldman Sachs: Very helpful. Thanks for that. My other question was around the ASPs and hoping to better understand how Rivian is expecting ASPs per vehicle to trend. You launched the quad motor and talked about the positive pricing benefits of that product line. But with the IRA credits set to go away in the fourth quarter, I’m wondering if you think Rivian is going to need to adjust its pricing strategy and perhaps it may be a headwind.

So any more color around how to think about pricing and the puts and takes? Yes.

RJ Skirinj, CEO and Founder, Rivian: We’re tracking really closely how everyone’s doing in the market, and it’s important to call out. It continues to be a market share leader in the segments it operates. It’s really a core leader. So if you look at electric vehicle SUVs sold over $70,000 it’s across The United States, it’s the market share leader by a significant degree. And uniquely, if you look at California and now the state of Washington for the premium segment, EV or non EV, premium segment SUVs, so SUVs over $70,000 it’s the market share leader.

And so we continue to see that in light of some very aggressive incentives from some of the vehicles that might be cross shopped with Rivian. And so as we look at the remainder of this quarter, Q3, we do think Q3 will be our strongest quarter of the year. But we also think that some of the irregular incentives and some of the things we’re seeing in terms of the marketplace will subside. And the market, as a result, will continue to see with market share leadership on R1, we’ll continue to see demand persist.

Claire McDonough, Chief Financial Officer, Rivian: One other item I’d just add on is we do anticipate there being higher levels of commercial van deliveries in the second half of the year relative to the first half of the year. So as you look at the overall Rivian blended ASP, you’ll see the commercial vans reducing that figure, although anticipate there being strong, ASPs on the r one program as RJ noted.

Call Moderator: Our next question will come from Daniel Roska. Your line is open. Please ask your question.

Daniel Roska, Analyst: Hey. Thanks for taking my questions. I’d like to double click a little bit on Dan’s first question on the EBITDA breakeven in ’27 because it does seem that there are quite a few meaningful headwinds, especially in the near term, and some of the items you talked about seem like they’re more long term opportunities. So I’m just you know, maybe you could go back and comment a bit on ’27 because, you know, we’re losing the EV credits. The, you know, loss of the IRA and purchase incentive could be almost 10 to 15% of an r two purchase price.

The Volkswagen partnership, if I recall correctly, doesn’t have financial upside other than the disclosed amounts that are kind of baked into the guidance. And even more partnerships are highly unlikely to materialize by ’27 if you’re willing to integrate a full kind of electrical architecture into a new car. So I’m I’m wondering here with those headwinds, shouldn’t we expect the EBITDA breakeven to move into later years given the plan we discussed last year?

RJ Skirinj, CEO and Founder, Rivian: Thanks, Daniel. Claire and I will speak to this one. I think, first and foremost, we did speak a little bit earlier in the call on this, but the R2 cost structure and the way that we’ve developed the vehicle provides us with a platform, a cost platform that’s just materially different than where we’ve been on R1. And along with that, a number of factors, since we talked about this before, despite some of the headwinds, we’ve had a number of factors that are actually positive movements for R2. And Claire referenced this, but first and foremost is the ability to look at joint sourcing of some of the electronic components that are used in R2.

And and of course, of those components will be used across the Volkswagen Group as well. We’ve also, as Javier noted, are now in a position where this the bill of materials on R2 is sourced. It’s no longer something that we hope we can achieve, but in fact, we’ve been able to put that together. And as we now look at continuing to grow those relationships with suppliers and thinking about 2027 and beyond, you know, the whole supply base, ourselves, everyone has been looking at ways to drive cost efficiencies into the business to address one of, you know, some of these major headwinds that have occurred in terms of tariffs and tariff structure. And by 2027, there’s a lot of plans or offsets that are being put in place by us, by our suppliers to address those specific headwinds.

As you called out, the EV credits environment, which for us was a meaningful source of revenue where we would sell our excess credits to other manufacturers. That being reduced is does is a short term reduction in positive cash. But on the flip side, we also now have an environment, which we believe we’ll start to see in 2027, where a lot of the manufacturers who are choosing to earn their own credits by incentivizing sale of electric vehicles, they’ll be less incentivized. So the I’ve said this many times, but the long term level of competition in the EV space is going to be inherently lower. There’s less incentives for incumbent manufacturers to make the commitment or the transition to electrification.

And when we look at all those things together, there’s, of course, some puts and some takes, but we still believe achieving the twenty twenty seven positive EBITDA is the target we need to be driving towards is what Claire talked to. We’re pushing extremely hard to get there and, you know, recognizing that we have time to react to some of these changes.

Claire McDonough, Chief Financial Officer, Rivian: The other key driver, is as we look at the broader software and services opportunity, this is an area where we do anticipate there being, significant growth over the course of the next two years, especially as we recognize greater levels of revenue from some of the background IP consideration, which is associated with the progress occurring within the joint venture and getting Volkswagen vehicles, you know, out on the road and and into the the wild, which is is one of the key contributing factors as we think think about the relative contribution of both the automotive business from a gross profit standpoint, which is driven by r two and the continued scaling of the normal plant as well as the software and services opportunity from the joint venture coupled with the broader opportunities that we have as we continue to scale and grow the car park and achieve additional gross profit and ultimately contribution to our our EBITDA target from things like our remarketing program and the sale of used Rivians, from our charging network, from our the birth of our our service infrastructure, financing, insurance, and in future state autonomy is another driver of of some of that road map as well.

Daniel Roska, Analyst: Great. That’s very helpful. Thanks. And maybe, RJ, you you referenced it a bit when you talked about the competitive environment for the r two. I mean, do you think that even without the IRA credits, that can be kind of still a gross profit breakeven car, kind of just the car itself, or do you need kind of software services and other elements to make that EBITDA kind of work for the car itself?

RJ Skirinj, CEO and Founder, Rivian: No. To be clear, we’re we’re we’re absolutely designing the vehicle and have set up the cost structure on on r two to on on the vehicle itself to have the healthy positive gross margin.

Call Moderator: Our next question will come from Joseph Spak with UBS. Your line is open. Please ask your question.

Derek Mulvey, Vice President of Finance, Rivian0: Thanks. Good afternoon. May maybe just two quick clarifications and then a bigger picture question. Like, you you previously, on these earnings calls, have said you were baking in several $100,000,000 in policy impacts, which I know is vague, but I think was interpreted and suggested as tariffs and some regulatory credits. So I know you just lowered the regulatory credits, so basically, I’m not assuming it’d be in the back half.

That seems like it’s maybe half the the EBITDA reduction. But what exactly got worse on tariffs, and now you see it a couple thousand dollars per vehicle higher? And then just the other clarifications on the 27 EBITDA target, which I know came up a couple times. Since, I guess, the the the regulatory, right, so the one thing you’re willing to concede has changed, like, how much was actually baked into 27 for for that number?

Claire McDonough, Chief Financial Officer, Rivian: Just wanted to clarify on on your first question, Joe. The couple thousand dollars a unit on tariffs is consistent with the commentary that we provided last quarter, so there’s no change overall in terms of the the outlook from a tariff impact on the business as we look at the ’25 impact. So the incremental impact, as we mentioned, is real from a policy standpoint, is really driven by changes in the regulatory credit outlook, where we no longer anticipate we’ll be selling or earning revenue from the sale of regulatory credits in the the second half of of this year, given changes to, you know, certain regulatory credit programs that have occurred of of late. As we look at, you know, the broader guidance, the the other impact is, as we talked a little bit about in our prepared remarks, was just driven by the Q2 overall performance and some of the supply chain related complexities that limited our production volume this quarter in particular. As we look at 2027 EBITDA, we’re not going to get into specifics in terms of what was in and is now in, the overall outlook from a regulatory credit standpoint.

We fully acknowledge that the bar has risen, given some of the policy related headwinds that we’re now working through as a business. But our objective is to continue to drive towards positive EBITDA through a number of ongoing initiatives to drive new cost efficiency into the business and to ensure that we have an efficient ramp of of r two.

Derek Mulvey, Vice President of Finance, Rivian0: Thanks for that. The second question, I wanna touch back on something Adam brought up earlier, which is, you know, the second plan. So you’re taking three weeks downtime here in September to get normal capacity to two fifteen k. You’re currently producing at, I don’t know, probably, below 20% of that utilization right now. So and I realize, like, it’s not fair because you have much higher volume hubs for the r two.

But I guess, like, at what level of utilization do we need to see a normal before you really start thinking about commissioning Georgia?

RJ Skirinj, CEO and Founder, Rivian: It’s a Joe, it’s a great question. We we we think about the normal facility. We’ve talked about this a lot in the past. It’s ultimately going to be producing R1, R2 and our commercial van. And as we look at some of the variants on the R2 and R2 platform, what that does with bringing on the Georgia facilities, it not only expands capacity but allows us to build some of these additional variants and further grow both the addressable market and importantly, in where we see some real volume opportunities.

But with regards to Georgia, we are building that across two phases and we’re going to be starting construction on the Georgia facility in terms of the building. Of course, a lot of work has happened on the site and preparing the site you know, in close partnership and conjunct and in conjunction with with the state of Georgia. But we’re starting going vertical on buildings in the early part of twenty twenty six.

Call Moderator: Our next question will come from Ron with Guggenheim Securities. Your line is open. Please ask your question.

Derek Mulvey, Vice President of Finance, Rivian1: Yes. Good afternoon, and thank you for taking my questions. A bit of a follow-up on some of the policy changes, but has any of the impact of these policy changes, whether it’s emissions or consumer credits, change how you view the r two or r three with respect to whether it’s pricing costs or or how much capacity is needed. And I know that there’s some sensitivity around the the preorder number for for the r two, but if you’d be willing to share an update, it it probably would go a long way in kind of assuaging concerns around around the needed capacity with with Georgia.

RJ Skirinj, CEO and Founder, Rivian: Yep. I mean, I I’ve we’re not gonna share the the number here, but you know, I have said a couple of times, I mean, we’re extremely bullish on R2. And a big part of developing a product like this, this is an enormous amount of effort. A lot of iteration has gone into defining what the product is. A lot of work understanding the size, the pricing, the cost structure, the content.

But where we’ve landed in terms of what we’ll be starting production on here shortly is something that we feel has an outstanding product market fit in the heart of the demand curve, meaning price points overlapping with the largest segment, the form factor overlaps the largest segment and the feature and content is really, really incredible. And so what that means, in our view, is this is going to be cross shopped across the broadest spectrum of possible variants, most of which actually are ICE vehicles. So customers will be making a consideration that maybe haven’t made the jump to electrification, but would like to, but wanted maybe something that was more of an SUV form factor, wanted to spend $45,000 to $50,000 and that hasn’t existed in the market. And so we do see the scale of the addressable market as being many, many millions of units. And so with what we’re launching in normal, representing 155,000 units of R2 capacity and then what we’d be bringing on in Georgia for the platform, which, of course, by me saying that, it implies variance of that vehicle adding another 200 in the first phase, we feel quite confident and bullish on what that represents.

It’s also worth noting that, and we’ve said this in the past quite a bit, the R2 and the platform are designed to support both The U. S. And European markets. And so not only we’ll be opening up this vehicle across many more price points in a much bigger addressable market in The United States, but ultimately, this platform is going to support opening up, you know, access to a very large market, which is Europe. And so, of course, we’re, you know, follow-up question, I’m sure what you’re thinking now is, you know, what do we think about U.

S, EU trade relations and what is going to happen there? We’re watching that very closely. Certainly, there’s been some, you know, positive movements on that for us being that we’d be exporting these vehicles from The United States to Europe, but we have to continue to watch that very closely.

Derek Mulvey, Vice President of Finance, Rivian1: Yeah. No. I appreciate that. And and then on the technical aspects of of your approach to autonomy, excited to see what you have in store for us later this year. But some of your competitors are opting for camera only as you’re well aware.

Some are opting for more hardware heavy approaches with LiDAR or or even beyond that in terms of the the hardware required. I guess, what gives your team confidence that your early sensor fusion approach to autonomy is the correct one?

RJ Skirinj, CEO and Founder, Rivian: Yeah. It’s, it’s I think it’s an important question. I I do think that this question of what’s the sensor set topology gets more attention than it really should. I think the approach of using an early sensor fusion, which is just a different way of saying an AI centric approach, meaning if you think of, like, how systems were developed prior to 2021, and when I say systems, essentially every self driving platform developed prior to the use of transformer based encoding, was you would have a set of sensors that may include more than just cameras, but whatever that set of sensors is, each sensor would identify objects, classify those objects and associate vectors with those objects. And all those identified objects and their associated vectors would then be passed to a planner and you’d make a whole series of rules based decisions around what the vehicle should do and decisioning around which sensor set to actually follow or trust.

In that late fusion process, you know, had some of the challenges I think you’re alluding to of having, you know, to decide around what’s your primary sensor path and what are the risks and associated challenges with using some of the other sensors. As you move to something that’s much more AI centric, you have to think of it very differently. Think of it as you have an enhanced view of the world, an enhanced view of reality as early as possible. So raw feeds going directly into inference, you can create a better understanding of the situation and the circumstance. And the neural net, the large model that we build around this, then drives ultimately how the vehicle performs.

And we do that through the use of a very large data flywheel with our deployed fleet providing, you know, trigger data back into our, you know, back to us, which we then build, use to train to build this large parameter model that ultimately determines how the vehicle behaves in these situations. And so I think ultimately that this debate around which sensors are used, I think often we it’s maybe based on cost structures that are no longer in existence. So, LiDAR, radars, these things are not as expensive as they once were. And it allows us to build a much richer understanding of what you can see, what the vehicle sees at the early stage, at a base level as we start to make decisions through the model, through this large foundation model in terms of what the vehicle should do. You know, and I often draw the analogy to say it’s what’s helpful here is it’s accretive, meaning if the sensors get better, you don’t throw away the model as we once did.

You now just the model has a more precise understanding of the world. And the best example is imagine you learned how to drive without glasses and you had poor vision and then suddenly I handed you a pair of glasses. It wouldn’t be as if everything you knew up until that point was obsolete. In fact, you would just have a more accurate view of the world to be able to make better decisions through your neural net, through your brain, which is processed how the world behaves and drives. And so it’s no different as you increase the quality of the cameras.

That’s both in terms of, you know, breadth of performance, low light to high you know, bright light, and then also details in the camera. So increasing levels of megapixels, which is important for us. We go from 55 megapixels in r one to 65 megapixels in r two. But it also pertains to additional sensor set, which allows in another modality that has non overlapping strengths and weaknesses with a camera set to also have a perception of the world. And so if you were to give me a LiDAR or a radar and bolt it onto my forehead, I would be a better driver as a human, but it wouldn’t negate or throw away or make obsolete all of my accumulated knowledge to date.

Call Moderator: Our next question will come from Emmanuel with Wolfe Research. Your line is open. Please ask your question.

Derek Mulvey, Vice President of Finance, Rivian2: Great. Thank you so much. So when I look at your software and services revenues in excluding the JV, they were up very sharply versus last year. How should we think about the growth there going forward, the trajectory, your profitability profile for it? And to what extent I guess, how much of this was embedded in your expectation for positive EBITDA by year end twenty seven?

Claire McDonough, Chief Financial Officer, Rivian: Sure, Emmanuel. As as we think about some of the key contributors to the growth and and profitability that we saw in in q two from software and services, one of the drivers of this is the growth of Rivian’s remarketing program. So this is both trade in vehicles for consumers getting into a Rivian for the first time, but also one of the key contributors is the the sale of used Rivians, as we think about being able to open the aperture, attract more consumers that can afford an r one at a variety of different price points, which is is a very compelling business for us over the long term and one that’s important to Rivian maintaining strong residual values as as well. Beyond that, we’ve continued to to see the growth and expansion of our service infrastructure, that’s also contributing to the the growth in in some of our maintenance expenses, and revenues in the the business. And then beyond that, we’re in the process right now of opening up our charging network to additional vehicles and going through the integration of NACs as well, which will allow more and more customers to charge on the the Rivian adventure network, which will again be another contributing factor for us over the the longer term.

So as as we look at the underlying tailwind of of software and services, we saw significant quarter over quarter growth in terms of the non joint venture contributions to the gross profitability of of this business segment. And as I mentioned, as as we look ahead to 2027, we’ll see the joint venture contributing more significantly, given increasing in increases in background IP related revenue streams. The growth of the JV as well is that they continue to to hire and grow, to expand the team and organization, as well as the the ongoing growth of of many of these key internal services that will be, you know, servicing a a larger car park as as a whole. So we see this as a meaningful contributor to the business on a go forward basis and especially as we think about the the contributions in 2027 as well.

Derek Mulvey, Vice President of Finance, Rivian2: Understood. And then coming back to the earlier question of the r two economics. So, RJ, you were mentioning how, you know, the bomb would be about half of r one, but then there’s also operational and manufacturing efficiency. How should we think about the gross breakeven point for that vehicle? You’re putting in under 55,000 units of capacity into normal.

You’ll be leveraging a lot of the fixed cost base already within that facility. How many r twos do you need to sell to sort of, like, get a combination of both these costs or, like, getting you to breakeven?

Claire McDonough, Chief Financial Officer, Rivian: So as we look at the the overall outlook for the r two unit economics, we see a much faster path to to positive gross profit on the vehicle itself. And that’s primarily driven by the fact that, the vehicle has a a much lower underlying material cost structure associated with it that that RJ walked through. But beyond that, r two is also benefiting from the the volumes that are already existing within the normal plant as as well, that allows us to to efficiently get to a positive gross profit on, the r two program. We think as we exit 2026, it can be at that level. And then we’ll be looking to expand that as we add a third shift of operation into the plant, continue to reduce the the cost structure over time?

RJ Skirinj, CEO and Founder, Rivian: You know, one of the one of the big strategic reasons we we made the decision to launch r two out of our normal facility is the shared fixed cost absorption that we’ll now have between R1 EDV and R2. And as Claire said, out of the gate on day one of production of saleable units of R2, we’ll already have the benefit of all the fixed cost absorption that R1 and the commercial vans are picking up. And so it just has a fundamentally different path to profitability than what we saw with R1. Above and beyond that, some of those assets that R2 is going be utilizing, like our stamping operation, those have already been in use for a while and have already, you know, much of that has been depreciated. So there’s there’s just inherent overall, you know, fixed cost advantages to being being in normal.

Call Moderator: Our next question will come from Andre Shepherd with Cantor Fitzgerald. Your line is open. Please ask your question.

Derek Mulvey, Vice President of Finance, Rivian3: Hi, everyone. Can you can you hear me okay?

Claire McDonough, Chief Financial Officer, Rivian: Yes.

Derek Mulvey, Vice President of Finance, Rivian3: Wonderful. Well, thank you so much for taking our questions. Good afternoon, and congratulations on the quarter. By the way, I think this is our first time making it to the q and a, so bucket list for us. I think a lot of our questions have been asked, but RJ was hoping to come back to ASPs.

You know, just given the macro environment, tariffs, removal of tax credit, do you expect any changes to ASPs particularly off the r two line? Should we be still targeting around, you know, 45, 50,000? Any color there would be helpful. Thanks.

RJ Skirinj, CEO and Founder, Rivian: Yeah. So as we look at ASPs through the course of this year and then into r two, you know, Claire referenced this before, but on a on a consolidated basis for the whole business in the second half of the year, we are gonna be selling more vans. So that will have the effect, on a full consolidated basis of pulling our average selling price down for the whole business. But it’s important to pull that apart. So the R1, we’ve now launched our quad.

The demand in that has been strong. We also have our tri motor. Demand in that has been very strong, particularly as percentage or take rate, if you will, across the whole fleet. And so we do see positive movement on ASP for R1 through the end of the year, which is really encouraging. And translating that into what we see with R2, R2 has a range of different variants.

And so we often talk about the entry price or the starting price being at 45 But there’s a middle spec variant. There’s a top spec variant. There’s what we’ll be launching with, which will be, you know, a more premium version of the vehicle. And so a big question for us and a big target for us, I should say, is to be making sure we’re designing those configurations of those packages in ways that make them highly desirable, but help us to maintain a healthy ASP that, of course, is supportive of greater margin levels and is reflective of what customers are looking for. And so that’s something we’re looking at very closely.

Derek Mulvey, Vice President of Finance, Rivian3: It’s

RJ Skirinj, CEO and Founder, Rivian: mix, like the combination of variant mix that we’ll ultimately end up with is going to depend a lot on the on the specific situations that we’ll see, you know, as we’re producing that vehicle, so in 2026 and 2027. But as it stands today, if we were to use r one as a reference point, we see a positive mix shift in the second half of this year relative to the first half of this year.

Derek Mulvey, Vice President of Finance, Rivian3: Got it. That’s super helpful. I really appreciate all that color. Maybe just as a quick follow-up. I I I know we touched on autonomy and the different technologies and use cases.

I’m just wondering if you can maybe give us your vision in terms of kind of the initial ramp up of that developing? Any granularity that you might be able to provide? And then also here’s a question. Are you considering autonomy for the EDVs potentially? Just curious if you’re considering maybe commercial self driving as well.

Thank you.

RJ Skirinj, CEO and Founder, Rivian: Andreas, this is, by a significant degree, one of our biggest focus areas. And to I I alluded to this and talked to this before, but just to be very explicit, the approach that we’re utilizing on autonomy is represents a significant shift, a significant step. You often hear it called like AV2 auto relative to what was done prior to like 2021, 2022. And so what we launched with an R1 with our Gen one vehicle is a completely different topology, different sensor set, different compute stack, completely different software architecture to what we now have in our Gen two. And so what we designed our Gen two vehicle with was a much higher level of compute.

So it’s inference on vehicle, much more capable cameras. We brought all that perception stack, the camera set in house. Of of course, we designed the compute platform to support that really rich camera set that I talked about earlier in the case of R1 that’s 55 megapixels of camera with cameras with outstanding breadth of performance. And really, the the goal of that, which launched a little more than a year ago now with the Gen two vehicles, was to create a data platform to train a a very capable model. And that very capable model, of course, gets better as the fleet size grows.

And when we say train, I want to be specific here. It’s not just having vehicles with lots of sensors and a lot of inference on board. The way that we trigger what data gets sent back to us, so what are the triggering events? Of course, it’s, you know, when the vehicle encounters an issue, when it disengages from its autonomous driving mode. But importantly, when you’re not in autonomous driving mode, what’s triggered?

What are we doing to find interesting situations that fill in and add robustness to this large model we’re building. And so we’ve really spent a lot of time defining a whole array of different triggering events that allows us to pull data off of our deployed fleet, use it to build robustness into the model and then redeploy that model and the distilled version back down to back out to the vehicles. And that’s what customers are starting to see in terms of improved feature set. And we are deeply of the belief that this approach of an AI centric approach, what you may often hear called like an end to end approach where you’re training based upon the behaviors of the vehicles, the approach that’s going to win. But it does require you to control the perception stack.

It requires you to have a very robust data triggering architecture. It requires a very robust data movement architecture, meaning your vehicles are ideally connected to Wi Fi, which allows much lower cost movement of lots of data. And so the incentive structures we’ve put in place around having customers on Connect Plus and having them Wi Fi connected helps drive that. But that feeds, you know, our offline training that’s occurring on, you know, of course, on lots and lots of GPUs, which then continues to get better and better. And so that set of ingredients, we think very few manufacturers have.

We’re investing tremendously into it. And what we’ll start to see in terms of customer facing features is, first and foremost, we’ll see the vehicles be able to operate under a much wider range of roads. So today, we limit our feature to a highway feature. In the not too distant future, we’ll go map free. And what we say that, but what we really mean is it can operate essentially anywhere.

And we’ve already gone hands free in certain conditions on highways. We’ll broaden that to be more conditions. So eyes on, hands hands off. And, of course, the next step as we look into 2026 is identifying specific areas where you’ll go hands off, eyes off. And so where you’ll truly get your time back, you can be looking away from the road, not an active participant anyway in the operation of the vehicle, and coupling that with a turn by turn capability.

So you get into your car, you can imagine the future state where the car then, you give it the address and it takes care of getting there. And so that is our as we think about what’s the road map for the next couple of years, that’s what we’re driving towards. Core to that is this building of a large model. Of course, that model has applications beyond just R1, R2 and beyond, as you referenced, those applications in the commercial space and with our commercial vans. And so we’re we’re very, very excited about what this represents in terms of the business opportunity it creates, but also the customer experience it it forms.

Call Moderator: Our last question will come from George Janorikos with Canaccord Genuity. Your line is open. Please ask your question.

Derek Mulvey, Vice President of Finance, Rivian3: Hi, everyone. Thank you for taking my questions. You sort of alluded to this, in a previous answer, but I’m I’m curious to you know, with the impressive specs of the r two and the compelling price, you know, you are admittedly launching it into a challenging market for EVs. Could you just sort of illuminate us as to maybe broad marketing strategies or anything you plan to do to boost the market appeal of the product? Thank you.

RJ Skirinj, CEO and Founder, Rivian: One of the most important things we’ve we’ve talked about since way before we even launched r one that it’s really important for us as a company, if we’re committed to our mission of driving an increase in electrification, is that we attract non EV customers. And, you know, we now have the benefit of seeing how that’s played out with R1 where, you know, a meaningful majority of our customers are moving out of an ICE vehicle and into their R1 as their first time EV experience. And, you know, what enabled that is that the product and the attributes that the product delivers on are unique relative not just to EVs, but are unique and exciting relative to all other options. And I referenced this earlier in the call, the R1S is the best selling premium SUV in California and the state of Washington. I didn’t say the best selling premium electric SUV, just the best selling premium SUV.

And so it’s attracting all different types of buyers. And so as we look at now, as I said, the heart of the demand in The United States, you know, the average selling price of a new car in The United States is just under $50,000 The most popular vehicle configuration is a two row SUV. The R2 is right there, right in the right price point, the right segment, the right size, and it’s delivering a level of performance that’s not seen by any of the alternatives you have certainly in the ICE space there today. It’s delivering a level of capability, meaning both on road and off road capability, that’s also not seen in that price point. And it has entirely new features like things like a front trunk or some of the dynamics of the vehicle, but given the low center of gravity, that just are not seen in the SUV space, know, they call it the $50,000 ICE SUV space or $40,000 to $50,000 ICE SUV space.

And so we do see it as a very large market and our hope and what we’re driving towards is to continue being able to draw a lot of non EV customers into this, not simply because it’s an EV, but rather because it’s the best choice they have. And that’s how our engineers are thinking about the product, making it the best choice, the best SUV that you can buy, you know, between, let’s call it, you know, dollars 45,000 to $55,000 And and that’s ultimately how we’ll drive significant market share both in the EV space, but also we we look at it as through the lens of driving significant market share just in the, you know, the the midsize SUV space.

Derek Mulvey, Vice President of Finance, Rivian3: Thank you. And maybe as a a brief follow-up, any news to share on on commercial vehicle momentum, any additional wins or or traction there? Thank you.

RJ Skirinj, CEO and Founder, Rivian: There’s been a a few vehicle settings that have that are different than different than the Amazon vehicles. But, you know, I think the most important thing here, and Claire referenced it, I said it as well. You know, we continue to work very, very closely with Amazon. They’re an outstanding partner. Of course, they’re a major shareholder in Ravine as well.

And we are seeing more deliveries of our vans with them through the second half of this year. The partnership continues to be very healthy, great close relationship with the users of the vehicles, the drivers of the vehicles and the operators of the vehicles. And that continues to allow us to make improvements and tweaks to the vehicle such that, you know, we hoped to achieve this a few years ago when we were developing the vehicle. We can now say this with confidence. It is the best platform for logistics and commercial delivery, bar none.

It’s an outstanding product. And so to be able to harden that product and refine it in conjunction and partnership with Amazon has been great. And we do think as other fleets start to electrify, they’ll see this as a great choice.

Call Moderator: This concludes the Q and A section of the call. I would now like to turn the call back to RJ Spirinj for closing remarks.

RJ Skirinj, CEO and Founder, Rivian: Thanks, everyone, for joining us today. Hopefully, you’re hearing just the enormous excitement that we have for R2, the state of the program and the health of the program in terms of its cost structure, its development status, the close work that we’re doing with the suppliers, as Javier and Boot spoke to. These are fully engaged suppliers that are working with us in the development of the vehicle. You’re also, if you’re living in the Bay Area or Southern California, you’re probably starting to see these camouflage vehicles out on the roads. It’s certainly exciting, but we’re really focused on getting the vehicles ready for a very smooth and very healthy launch of the product.

And along with that, the focus that we have on building out our autonomy and self driving platform, We’ll see that make continued big steps forward on the R1 vehicle. And as we launch R2, with the further enhancement to our perception stack, we’ll see, again, really leadership in the R2 vehicle around our self driving platform. And so those are core efforts for us and really, we think, create an outstanding future state for us. And we are very, very bullish on R2. We’re very, very bullish because of that on the outlook for the business.

And we appreciate everybody’s support and everybody joining this call.

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