--- title: "RIVN (4Q25 Trans): All-in on R2 and AD, Can It Mount a Comeback?" description: "We are highly confident in R2 demand. The order backlog is substantial." type: "topic" locale: "en" url: "https://longbridge.com/en/topics/38715251.md" published_at: "2026-02-13T03:40:45.000Z" author: "[Dolphin Research](https://longbridge.com/en/news/dolphin.md)" --- # RIVN (4Q25 Trans): All-in on R2 and AD, Can It Mount a Comeback? Below is Dolphin Research's Trans of the $Rivian Automotive(RIVN.US) FY25Q4 earnings call. For the earnings review, see '[Rivian: Farewell to state subsidies — can R2 lead the turnaround?](https://longbridge.com/en/topics/38714431)' **1\. Key financials recap** **FY2026 guidance:** - Total deliveries: 62,000–67,000 units (R1, R2 and commercial vans). - Delivery cadence: approx. 9,000–11,000 units per quarter in 1H26. - Adj. EBITDA loss: -$2.1bn to -$1.8bn (incl. higher R&D). - Capex: $1.95bn–$2.05bn, focused on R2 and Normal plant build/tooling, initial vertical construction at the Georgia plant, and expansion of sales/service/charging networks. **Earnings call details** **2.1 Management highlights** **Product and biz. updates** **1) R2: cornerstone of mass-market strategy** **Status:** only months from start of deliveries, with manufacturing validation vehicles off the line since mid-Jan. **Product strength:** - Launch edition: dual-motor AWD, 650+ hp, 300+ miles of range. - Positioning: extends the R1 experience (design, performance) with a smaller footprint and more accessible pricing. **Media feedback:** pre-production units received extremely positive reviews, with critics calling it 'possibly the best all-around EV I have driven'. **Reveal plan:** more product, pricing and lineup details on Mar 12. **Production ramp:** launch edition starts on a single shift, moving to two shifts before year-end. **2) Autonomous driving and AI** **In-house chip (RAP1):** pursued for speed, performance and cost efficiency, and a key pillar of the AD platform. **Feature progress:** - General hands-free: now mapped to 3.5mn+ miles of North American roads; post-launch usage doubled. - Rivian Assistant: demoed at AI Day, slated for early 2026. - 2026 targets: LiDAR for customers by year-end, first RAP1 chips, and limited point-to-point capability. **Underlying stack:** 'Rivian Unified Intelligence' — a common AI foundation spanning design, development, manufacturing, service and customer interactions. **3) JV with Volkswagen Group** **Progress:** 13 months post-formation, vehicles have been delivered for winter testing across multiple VW brands. **Strategic significance:** validates the scalability of Rivian's electrical hardware and software platforms. **4) R1 and brand positioning** **Market performance (Q4 2025):** R1S was the best-selling luxury EV priced above $70k in CA, NY and NJ. In CA, it was also the top-selling SUV above $70k, including ICE. **2026 outlook** **GP outlook:** while we expect full-year GP to rise YoY, the complexity of launching new vehicles will weigh on auto GP in Q2–Q3. In Q4, higher production and deliveries should turn into a positive contributor to operations. 2026 is a transition year for auto profitability. Year-end execution on R2 production and deliveries is the team's primary focus. **Adj. EBITDA and R&D outlook:** Adj. EBITDA loss of $2.1bn–$1.8bn for 2026, including higher R&D as we accelerate the autonomy roadmap, aiming to offer LiDAR, the first RAP1 chips and limited P2P capability by year-end. We view autonomy as a core long-term competitive edge. **SG&A outlook:** as R2 scales, expansion of service and sales networks will drive continued SG&A growth. **Capex:** $1.95bn–$2.05bn, focused on R2 and Normal plant build/tooling, initial vertical construction at the Georgia plant, and expansion of sales/service/charging networks. **2.2 Q&A** **Q: Does the 9,000–11,000 per quarter cadence in 1H26 refer to R1 plus EDV for 2026? Will the 2H uplift mainly come from R2?** A: R2 should start delivering in Q2 with small initial volumes, contributing little to the 1H26 cadence. In 2H, R2 ramps alongside commercial vans and R1. Full-year R1 plus commercial volumes are roughly flat vs. 2025. **Q: What are the R2 volume assumptions and read on demand? Will customers take delivery before the new ADAS platform/hardware is installed, and how much would that constrain deliveries?** A: We have been driving manufacturing validation units for months, especially over the past month. The vehicle excels in feature mix, space, dynamics and steering, and we are highly confident in the product. At the ~$50k price point, choice is scarce and share is concentrated in a single model, making R2 the first true alternative and very compelling to legacy mid-size SUV owners. On that basis, we are confident in overall demand and are investing accordingly. **Q: Specifically on ADAS: will customers take delivery before the new hardware is on the car?** A: Tech always iterates. Many customers just want a great mid-size SUV. Given the large backlog, R2 will launch with an upgraded Gen 2 AD system, with Gen 3 to follow; those who want to wait can wait, and those who want early delivery can get cars sooner. We do not see this as a major issue. **Q: Update on partnerships or licensing with other OEMs? Beyond in-house use, could the custom processor be sold to others, and what discussions are underway?** A: Within 13 months of the VW JV, testing has been completed across several VW brand programs, proving scalability across forms, price points and brands. We maintain broad relationships with other manufacturers. Over the next few years, each OEM will choose to build in-house, buy from third parties — Rivian is uniquely proven at external scale — or cede share. We are optimistic about the platform's potential as a key part of our future mix. **Q: Progress and expansion potential with VW? DOE loan guarantee for the GA plant and overall liquidity?** A: The JV is 13 months old with winter testing underway across multiple VW Group products, targeting a 2027 first launch. The partnership is strong, the tech scales across price points and form factors, and this opens doors to other OEMs. Software and services are projected to grow ~60% YoY with a 35% GPM target, a major GP driver. On capital: we ended 2025 with $6.1bn in cash, expect another $2.0bn from VW in 2026 and about $0.5bn in 2027. The DOE loan supports job onshoring — roughly 2,000 roles at Normal for R2 and 7,500 at the future GA plant. Rivian is committed to advancing U.S. auto tech, with JV technologies benefiting the broader industry. **Q: If R2 order conversion is strong this year, is there upside to the delivery guide? Any year-end production bottlenecks?** A: Ramp speed is gated by the slowest link — the plant and hundreds of suppliers can each be bottlenecks. We planned to start with one shift, add a second by year-end, and a third in 2027 to ensure a smooth supply ramp. Backlog is substantial, media feedback is extremely positive, and we are carefully aligning production with supply. **Q: With R2 pricing and costs now defined, do prior targets still stand — positive EBITDA in 2027 and long-term 25% GPM with high-teens EBITDA margin?** A: 2026 is a transition year for auto GP. At Normal, we target a weekly run-rate of ~4,000 units; achieving this would position us well for our Adj. EBITDA goal. Long term, auto GPM is targeted at 20%, with software/services and potential licensing lifting blended GPM above 25%. **Q: With a second shift starting by year-end, does guidance assume exiting 2026 at two full shifts? How should we think about the 2027 starting point?** A: The second shift will still be ramping at year-end, so we do not exit 2026 at full two-shift capacity. We will keep driving efficiency to support a full-year ramp through 2027. **Q: On Mar 12 will configuration open for reservation holders? Any order updates? How do lithium, metals and memory cost moves affect R2 pricing and the EBITDA guide?** A: On Mar 12 we will fully showcase the R2 lineup, including launch trims (dual-motor performance, premium trims) and combinations of trims, drivetrains and battery sizes. Configurations open then, with deliveries beginning in late Q2. Drawing on popular R1 specs, we are confident in demand, and full details will be shared on Mar 12. The Adj. EBITDA guide factors in raw-material inflation and the current supply environment. **Q: Main drivers of sequential and YoY declines in auto COGS? Where can R2 costs land, and does the 50% BOM reduction vs. R1 still hold?** A: Q4 per-vehicle COGS was $92,000, a ~$4,000 QoQ improvement driven by a higher commercial mix and better Normal plant efficiency. Full-year YoY gains reflected material cost declines (full transition to Gen 2, lower raw materials and lithium) and continued ops efficiency. For R2, joint sourcing of low-voltage electronics via the JV is already delivering material cost benefits, with further mid-size platform synergies expected at the GA plant. We also expect lower per-unit tariff costs (we did not fully receive Section 232 offsets in Q4), which should benefit R2. **Q: EDV volumes are roughly flat in 2026, yet you plan new variants, including longer-range for Amazon. When do these launch and what do they mean for deliveries and the commercial opportunity?** A: We expect EDV demand to rise in 2026. AWD and larger-pack variants will unlock specific use cases within Amazon's network. We are working closely with Amazon on requirements; the relationship is strong and EDV performance is excellent. **Q: With second and third shifts coming, has hiring at Normal begun? How is it structured and is it a constraint?** A: Hiring processes are in place and tracking to plan, with ample candidates and strong inbound interest. Some R2 line roles will transition from existing lines, with additional external hiring. Training has been bolstered, including pre-hire programs, and we are very pleased with the talent pipeline. **Q: Why not a consumer-electronics style 'announce-and-buy-now' for R2, but instead leave a gap? Is it psychology or production limits?** A: R2 backlog is large, and the challenge is sequencing deliveries. Opening configurations helps organize the backlog and schedule deliveries. Production is ramping and demand will far exceed capacity, so we will apply prior lessons to prioritize and deliver in an orderly way. **Q: Early feedback on general hands-free since Dec launch? What upgrades and OTAs are planned this year, and how do you think about paid subscriptions annually?** A: General hands-free is the first step in expanding autonomy, now covering ~3.5mn miles on any lane-marked roads. This year we will unlock point-to-point navigation where the vehicle navigates to an entered address. Roadmap: achieve hands-off, eyes-off on highways, expand to more scenarios, then move to geo-fenced L4 where vehicles can operate empty. We are convinced autonomy will shift from a 'nice-to-have' to a core purchase driver this decade and will reshape the biz. model. **Q: How should we expect working capital to move in 2026, especially during the initial R2 ramp?** A: Working capital will be a cash outflow in 2026, partly driven by inventory build tied to the R2 launch. **Q: If autonomy will drive value in coming years and some current or new R2 owners lack Gen 3 and LiDAR, will existing R1 owners get Gen 3 hardware upgrades? When does LiDAR enter R1 production?** A: No hardware upgrade is planned for R1. Gen 2 vehicles (R1 Gen 2 and R2 launch) will continue to receive OTA updates, but no hardware retrofits are planned. Hardware upgrades (Gen 3) arrive in early 2027. The AI Day P2P demo was on a second-gen R1, and that capability will be available on R1 Gen 2 and R2. **Q: Can Gen 2 deliver eyes-off P2P, or is Gen 3 required?** A: The upgraded architecture coming in 2027 serves key goals: raise the performance ceiling beyond P2P and strengthen the data flywheel. Adding LiDAR and higher compute turns every vehicle into a ground-truth collector, improving end-to-end model training. Continuous model gains depend on unique on-road events fed back from the fleet into the large driving model training loop. **Q: When Gen 3 becomes available in early 2027, is that for R1 or still for R2?** A: For R2. **Q: In the maturing relationship with VW, have you discussed data usage? Can VW's larger fleet data be used to train Rivian models?** A: The platform delivered to VW includes the embedded software stack, ECU topology and zonal architecture, but not the autonomy stack. **Q: Long-term outlook for the RAP1 chip — limited to Rivian, or applicable to partners, other OEMs, or even non-auto use cases like humanoid robots?** A: Autonomy is our most R&D-capital-intensive focus. As capabilities evolve toward L4, the platform's use will extend beyond Rivian, with monetization via higher share and volumes, new mobility biz. models, and tech sales to other OEMs. RAP1 and successors have broad potential in vision-based robotics — vehicles are the near-term robotics platform, and the newly created Mind Robotics is a key customer use case. **Q: Given recent lithium carbonate price moves, what is your latest thinking on in-house cell manufacturing and pack assembly once planned for Stanton Springs?** A: We have strong partnerships with cell suppliers and take an active role in upstream precursor sourcing such as lithium. Leveraging partners' invested capacity and cell designs helps us allocate capital efficiently. **Q: A key competitor will discontinue two premium models next quarter, freeing roughly 20k units p.a. of U.S. market share. Will R1 naturally capture this demand?** A: Model X's discontinuation is indeed an opportunity. R1S is the best-selling luxury SUV over $70k in CA, the best-selling luxury EV SUV in the U.S., and the top luxury EV in multiple states. Fewer choices help R1, and the scarcity in R2's price band is an even larger share opportunity for us. **Q: Can you quantify VW's expected contribution to this year's strong GP, given the ~60% YoY growth reference?** A: Roughly half of software and services revenue comes from the VW JV, and we expect a similar share in 2026. This segment contributes a disproportionate share of GP. **Risk disclosure and statements:**[**Dolphin Research disclaimer and general disclosures**](https://support.longbridge.global/topics/misc/dolphin-disclaimer) ### Related Stocks - [RIVN.US - Rivian Automotive](https://longbridge.com/en/quote/RIVN.US.md) - [VWAGY.US - Volkswagen](https://longbridge.com/en/quote/VWAGY.US.md) - [VWAPY.US - Volkswagen](https://longbridge.com/en/quote/VWAPY.US.md) --- > **Disclaimer**: This article is for reference only and does not constitute any investment advice.