Release Date: February 20, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Can you outline your assumptions for policy shifts, including tariffs and credits? A: Claire McDonough, CFO: Our outlook reflects our current view on potential adjustments, including incentives, regulations, and tariff structures. We anticipate hundreds of millions of dollars of impact on Rivian's EBITDA, inclusive of potential demand impacts. This is based on management's current outlook, recognizing the fluid environment.
Q: What is the trajectory for R1 COGS, and how does it relate to R2's cost structure? A: RJ Scaringe, CEO: We've made significant progress in reducing R1's cost of goods sold (COGS) by resourcing over half of the bill of materials, leading to substantial cost reductions. For R2, we project the bill of materials to be about half of R1's, with more than a 50% reduction in non-bill material COGS. This positions R2 as a lower-cost product, opening a mass market for us.
Q: Can you provide details on the Rivian autonomy platform and its cost implications? A: RJ Scaringe, CEO: We've shifted to an end-to-end approach with a 10x increase in compute levels from Gen 1. This architecture supports AI training for self-driving capabilities. While the GPUs for training are costly, we're exploring creative ways to access them without significant CapEx, leveraging partnerships and innovative financing structures.
Q: What are the expectations for software and services revenue, particularly regarding regulatory credits and the joint venture with Volkswagen? A: Claire McDonough, CFO: We expect approximately $300 million in regulatory credits for 2025, similar to 2024. The joint venture contributed significantly to software and services revenue, which we expect to exceed $1 billion in 2025, with the JV playing a significant role in this growth.
Q: How do you view the potential for monetizing the Rivian autonomy platform and software services? A: RJ Scaringe, CEO: In the short to medium term, we see opportunities to price hands-free, eyes-off features. Over time, the competitive landscape will influence whether these features are priced separately or embedded in vehicle pricing. Regardless, we believe these features will create economic value for Rivian.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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