0001874178-25-000052
SEC filingRevenue grew 78% YoY in Q3 2025 driven by automotive and JV services, achieving first positive gross profit, but net loss widened due to litigation settlement.
In Q3 2025, total revenue surged 78% year-over-year to $1.558 billion, driven by both segments. Automotive revenue rose 47% to $1.142 billion, reflecting a 32% increase in deliveries (to 13,201 vehicles) and higher average selling prices, partly from accelerated purchases ahead of the expiration of 45W tax credits. Software and Services revenue skyrocketed 324% to $416 million, primarily from vehicle electrical architecture and software development services performed under the Joint Venture with Volkswagen Group, which were not present in the prior year. Gross profit turned positive for the first time at $24 million, compared to a loss of $392 million in Q3 2024. Automotive gross loss narrowed to $130 million from $379 million due to ASP increases and lower material costs from engineering improvements, while Software and Services achieved a record gross profit of $154 million (from a $13 million loss). Operating expenses rose 30% to $1.007 billion, driven by higher R&D investments in the R2 platform and SG&A expansion for go-to-market infrastructure. Operating loss improved to $983 million from $1.169 billion. Net loss attributable to common stockholders was $1.173 billion, slightly wider than $1.100 billion last year due to a $183 million litigation settlement charge recorded in other expense, partially offset by a $101 million gain on the Also investment.
The Automotive segment saw production volume drop 19% to 10,720 units due to a planned paint shop upgrade in late September, but deliveries increased 32%, indicating strong demand pull-through. Cost of revenues per unit improved, with lower raw material and component costs benefiting from second-generation R1 redesign and supplier negotiations. Regulatory credit sales also contributed to revenue. The Software and Services segment was the standout, with cost of revenues rising 136% but gross profit swinging positive, driven by high-margin JV development work. The segment now represents 27% of total revenue versus 11% a year ago, underscoring the strategic pivot toward recurring and services revenue.
Management expects automotive gross profit to continue improving through the launch of the R2 midsize platform in H1 2026, material cost reductions, and factory efficiencies from the expanded Normal Factory capacity of 215,000 units annually. Software and Services gross profit is expected to grow as the Joint Venture progresses toward satisfying its performance obligations and as paid offerings like Connect+ and FleetOS expand. The company secured a $1.0 billion equity investment from Volkswagen Group upon achieving a milestone and has access to a committed $1 billion loan through the JV. Additionally, a DOE loan of up to $6.0 billion was arranged to support the Stanton Springs North Facility. Despite positive gross profit, Rivian still faces significant operating losses and expects to invest heavily in R&D and capex for future platforms. The company emphasized that incoming order rates for R1 must improve to meet delivery targets, and tariff and trade policy uncertainties pose near-term headwinds. Liquidity of $7.7 billion (including ABL availability) is deemed sufficient for at least 12 months.
As of September 30, 2025, Rivian held $4.44B in cash and equivalents and $2.65B in short-term investments (marketable securities), totaling $7.09B in liquidity. Total debt was $4.44B, unchanged from year-end 2024 after a $1.25B refinancing: the 2026 Notes were repaid with proceeds from the new 10% 2031 Green Secured Notes. Shareholders' equity decreased to $5.08B from $6.56B at December 2024, driven by net losses and stock issuance to Volkswagen Group. Inventory declined to $1.64B from $2.25B, reflecting improved working capital management.
Unconditional purchase obligations totaled $593M as of September 30, 2025, primarily under the data services agreement with Amazon. The payment schedule: $38M remaining in 2025, $168M in 2026, $198M in 2027, and $189M in 2028 and thereafter. Additionally, warranty reserves stood at $491M ($199M current, $292M non-current), and contract liabilities (deferred revenue) surged to $2.34B, largely from Volkswagen Group joint venture prepayments.
Rivian did not repurchase shares or pay dividends. The primary capital allocation action was the debt refinancing: in June 2025, the company issued $1.25B of 2031 Green Secured Notes at 10% and used the proceeds plus cash to retire the $1.25B 2026 Notes. Capital expenditures were $1.25B for the nine months ended September 30, 2025, representing 30.4% of total revenues, up from $814M in the prior-year period, reflecting continued investment in manufacturing and infrastructure. The DOE loan facility (up to ~$6B) remains undrawn.
Rivian reports two segments: Automotive and Software and Services. For Q3 2025, Automotive generated $1.14B revenue, a 47% YoY increase, but posted a gross loss of $130M. Software and Services revenue surged to $416M (up 324% YoY) driven by the Volkswagen Group joint venture, delivering a gross profit of $154M. The CODM uses segment gross profit as the primary performance measure. No geographic mix was disclosed.
CFO vs Net Income: Net loss improved from -$4.0B to -$2.8B, while CFO improved from -$2.9B to -$0.1B. The divergence is largely due to favorable working capital changes: accounts receivable decreased by $267M (vs. +$57M in prior period), inventory decreased by $511M (vs. +$208M), and accounts payable increased by $488M (vs. -$339M). Deferred revenues also contributed $495M (vs. $65M). Non-cash adjustments included depreciation ($583M), stock-based compensation ($551M), and a gain on equity method investment ($101M).
Capex Intensity: Capital expenditures rose to $1,247M (9.2% of trailing revenue? assuming ~$13.5B revenue? Not provided, but trend is higher). The company continues to invest heavily in manufacturing expansion.
FCF Coverage: Free cash flow is not explicitly stated, but CFO minus capex implies -$1,345M, compared to -$3,713M in the prior period. No share repurchases or dividends were paid.
Anomalies: Proceeds from issuance of long-term debt and repayments of $1,250M each net to zero. The $750M capital stock issuance relates to the Volkswagen Group investment. The gain on equity method investment of $101M is a non-cash item. No significant one-time tax payments.