2 Reasons to Buy Rivian Now

Core Viewpoint - Rivian is navigating a challenging environment with tariff uncertainties and delivery challenges while preparing for the launch of its R2 SUV, yet it has seen a 56% stock increase over the past year despite being below all-time highs [1] Operational Improvement - Rivian achieved its first quarter of gross profit in Q4 2024, with expectations for modest gross profit in full-year 2025, posting a gross profit of $206 million in Q1, down from $527 million the previous year [2] - The automotive division contributed $92 million and the software and services division contributed $114 million to the gross profit, alongside an 85% improvement in cash flow from operating activities compared to the prior year [3] Financial Milestones - The achievement of two consecutive quarters of gross profit unlocks a $1 billion payment from Volkswagen Group, marking a significant milestone for Rivian [4] - Rivian reduced automotive cost of goods sold by over $22,600 per vehicle delivered in Q1 compared to the previous year, resulting in five consecutive quarters of improving gross margin [5] Demand Generation - Rivian is launching its first major marketing campaign, focusing on real user stories and utilizing various media platforms to enhance brand awareness [8] - The company provided over 36,000 demo drives in Q1, aiming to increase consumer experience and drive demand ahead of the R2 launch [9] Future Outlook - Rivian's expected funding from Volkswagen, combined with $7.2 billion in cash and cash equivalents, is projected to support operations through the ramp-up of the R2 and R3 models, targeting a more mainstream consumer base and a path to positive free cash flow [11] - Despite being speculative and experiencing rapid cash burn, Rivian is positioning itself for a strong 2026, with recent profitability and marketing efforts providing reasons for optimism [12]