Prediction: This Crucial Rivian Metric Will Turn Positive by Year-End
Investors should always break down Rivian's gross profit into two segments, and its automotive segment has much upside in the near term as the EV maker adds a second R2 production shift and improves scale.
Overview
One of the most important ways Rivian (NASDAQ: RIVN) has separated itself from rival Lucid (NASDAQ: LCID) has been its ability to improve vehicle unit economics. It's well known that Rivian expects the R2 to check in at about half the production cost of even the more recent R1 vehicles. Rivian's improving unit economics have consistently improved its gross margins, even achieving its first full-year gross profit in 2025.
Rivian is about to be put to the test during the R2 ramp-up, and my prediction is that we're about to see Rivian's automotive gross profit finally turn positive as early as the third quarter -- software and services have largely been driving overall gross profitability. Let's take a look at where the EV maker's automotive gross profit is trending and why it matters.
Details
Here's a quick look at the consistent progress that Rivian has made in its gross profitability compared to rival Lucid, which has been unable to make the same improvements to vehicle costs and scale.
Source
Originally published at www.fool.com.