Rivian Posts Biggest Gain Since IPO After Q4 2025 Earnings

Aspiring electric vehicle contender Rivian Automotive (NASDAQ: RIVN) just saw one of its best stock price performance days on record. The stock popped nearly 27% on Feb. 13. This came as investors reacted to its latest earnings report, released the previous day. This was Rivian’s largest single-day gain in its history, aside from its stock market debut, when shares closed up by 29% following its November IPO.

Investors clearly overvalued Rivian initially. Even after its latest spike, the stock remains down over 75% from its IPO price of $78. Despite excitement among many that EVs will eventually replace gas-powered vehicles, very few EV companies have built profitable businesses and delivered strong returns. Rivian is attempting to become the next name that will succeed on this journey.

Let’s dive into the firm’s latest report that led to its record day and break down the implications going forward. 

Rivian Beats on Net Loss, Showing Gross Margin Resilience

In Q4 2025, Rivian generated revenue of $1.29 billion, a decrease of 26% year-over-year (YOY). This figure slightly beat estimates of $1.27 billion. The company’s more impressive metric was its adjusted loss per share of 54 cents. This loss deepened by 15% YOY, but was significantly better than expectations for a 68-cent loss.

Rivian achieved this better-than-expected profitability by delivering a strong gross margin. At 9%, the figure fell just slightly from 10% during the same period in 2024. At first, the falling metric may not appear impressive. However, Rivian nearly maintained its gross margin even though vehicle deliveries fell by 31% YOY, and vehicle production fell 14% YOY.

Higher volumes typically support gross margins, as companies can spread fixed costs over a larger amount of sales. Thus, the fact that Rivian’s gross margin barely declined despite volume tanking is a positive sign.

Two important dynamics supported Rivian’s gross margin resilience. Throughout 2025, Rivian’s average selling price (ASP) per vehicle rose by $5,500. Additionally, automotive costs of goods sold (COGS) fell by around $9,500 per unit during the full year.

Lower materials costs were the primary driver of COGS improvements. The company’s shift to the Gen 2 R1 architecture and lower lithium prices were key contributors to this. While the Gen 2 contribution could represent a structural cost improvement, lithium prices are volatile and may not benefit the company consistently.

Deliveries Forecast to Soar in 2026 As R2 Ramps Up

Rivian also provided positive forward-looking statements. The launch of its next-generation R2 vehicle remains on track, with initial deliveries slated for Q2 2026. At the midpoint, the firm expects to deliver 64,500 vehicles across all models. This would be a strong 53% increase versus 2025.

On the other hand, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) may only improve moderately. Rivian forecasts adjusted EBITDA of -$1.95 billion at the midpoint, which would be just 5% better than its 2025 figure of -$2.06 billion. Additionally, it projects capital expenditures of $2 billion at the midpoint, a 17% increase over 2025.

The firm expects the majority of its deliveries to occur in the second half of 2026, as it is still ramping up R2. The R2 launch will pressure profitability in Q2 and Q3, but the firm expects to exit 2026 with a positive automotive gross profit.

The company describes its “North Star” as getting deliveries from its Normal, Illinois facility to 4,000 per week. This, they believe, would allow them to achieve their goal of adjusted EBITDA profitability in 2027. However, 4,000 deliveries a week implies over 200,000 deliveries a year, a far cry from the company’s 2026 guidance. Achieving this will require very strong execution and robust R2 demand from consumers.

Analysts Eye Moderate Upside in RIVN After Latest Report

The consensus price target on Rivian sits at $17.62, nearly equal to its Feb. 13 closing price of $17.73. However, targets generally moved in the right direction after the company’s earnings. MarketBeat found only one analyst that lowered their target, and several that raised it.

Additionally, two analysts upgraded their rating on the stock. UBS Group moved from Sell to Neutral, and Deutsche Bank moved from Hold to Buy. Among price targets released after earnings, the average was $19. This figure implies upside in shares of 7%. These targets ranged from $15 to $25, highlighting significant differences of opinion among analysts assessing Rivian’s outlook.

Overall, Rivian provided investors with reasons for optimism in its latest report. However, the sustainability of this gain, and the potential to deliver further up-moves, remain questionable. Ultimately, R2 demand and the company’s ability to meet it will be the primary determinants of Rivian’s path forward. As 2026 progresses, the true long-term potential in Rivian shares should begin to reveal itself.

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