Why Rivian Stock Dropped Thursday

What happened

Ahead of what could be one of the most highly anticipated earnings reports of the year, investors in EV start-up Rivian Automotive (NASDAQ: RIVN) are taking profits today. After a very successful initial public offering (IPO) last month, shares of Rivian have since dropped 36% from their high. But the stock is still 41% above its $78 per share IPO price. Investors today, however, are selling its shares, which as of 1:50 p.m. ET were down 4.5%. The stock had been down as much as 7% earlier in the session.

So what

Rivian is set to announce its first quarterly financial report as a public company after the closing bell this afternoon. Investors won't be overly concerned with the profit and loss numbers, however. But with Rivian already valued at a market cap of almost $100 billion, there will be plenty of high expectations for what the company says, and how fast it will ramp up to begin selling its electric vehicles at scale.

Rivian R1T pickup truck and R1S SUV. Image source: Rivian Automotive.

Now what

One expectation from this afternoon's report is that the company will announce plans for a new EV and battery factory in Georgia. That has been rumored since last month, and CNBC reports today that sources told the Associated Press that the $5 billion plant will be announced later today. The report said the factory to be built east of Atlanta will employ 7,500 people, and could grow to as many as 10,000 workers.

Rivian plans to utilize its R1 EV platform to manufacture a pickup truck as well as an SUV. It will also make a fleet of electric delivery vans for Amazon, which is an early investor and customer. The e-commerce giant led a $700 million investment round in Rivian in 2019, and has placed an order for 100,000 commercial delivery vans.

Rivian said it also had 55,400 preorders for its R1T and R1S truck and SUV in the U.S. and Canada as of Oct. 31, 2021. Investors will want to hear if that has increased, and what progress Rivian has made on shipping its commercial vans to Amazon. Ahead of the report, however, some investors seem to be happy cashing out for now.

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