Rivian Automotive experienced a significant drop in its stock, plummeting 18% on Tuesday following the announcement of a public offering of 75 million shares of its Class A common stock. This marks the company’s worst trading day since 2024 and its fifth worst in history. The announcement came shortly after Rivian’s shares had risen 8.1% on Monday and increased by 19% the previous week.
Based on the closing price of $20.14 per share on Monday, Rivian is expected to raise approximately $1.51 billion from the offering. The funds are intended to finance equity contributions tied to a loan agreement with the U.S. Department of Energy. Furthermore, Rivian indicated in its filing that underwriters will have a 30-day option to purchase an additional 11.25 million shares.
This capital raise follows Rivian’s decision to suspend its profitability target for 2027, citing anticipated increases in research and development expenses for autonomous and next-generation vehicle technologies. Additionally, the company is set to launch its new R2 midsize SUV, which Rivian hopes will lead it toward profitability by the end of the decade.
In a separate filing, Rivian provided preliminary second-quarter results, estimating revenues between $1.55 billion and $1.65 billion, exceeding analyst expectations of around $1.45 billion. The company’s estimated balance of cash, cash equivalents, and short-term investments increased to approximately $5.3 billion, up from $4.8 billion at the end of the first quarter.
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