By Jaspreet Singh
(Reuters) -Rivian surpassed analysts' expectations for fourth-quarter deliveries on Friday and said its production was no longer constrained by a component shortage, a positive sign for the electric vehicle maker aiming to turn its first profit.
Shares of the California-based company rose nearly 19%. The stock lost more than 40% of its value in 2024.
The shortage of the part used in its R1 SUV and R1T pickups, as well as its delivery vans, started in the third quarter and forced Rivian to slash its annual production target in October.
"The previously discussed shortage of a shared component on the R1 and RCV platforms is no longer a constraint on Rivian's production," the company said on Friday.
Rivian handed over 14,183 vehicles in the three months ended Dec. 31, compared with estimates of 13,472, according to 15 analysts polled by Visible Alpha.
That was a 42% jump from the previous quarter and marked Rivian's highest deliveries in more than a year, even though Amazon.com (NASDAQ:AMZN), its biggest backer, takes fewer deliveries in the fourth quarter due to its focus on holiday season sales.
Rivian produced 12,727 vehicles in the quarter, compared with estimates of 11,398 units.
For 2024, production came in at 49,476 vehicles, down about 13% from a year earlier but above the company's lowered target of between 47,000 and 49,000 units.
"Improved production, coupled with its focused product strategy, puts Rivian on a competitive footing during a time when Tesla (NASDAQ:TSLA) might benefit from refreshing its consumer appeal to counter current market conditions," said eMarketer analyst Jacob Bourne.
Tesla reported its first fall in yearly deliveries on Thursday, also weighed down by the EV pioneer's aging lineup.
Rivian has cut costs sharply by renegotiating supplier contracts and revamping its manufacturing processes to turn a gross profit for the fourth quarter. It also closed a $5.8 billion investment from German automaker Volkswagen (ETR:VOWG_p) as part of their technology joint venture.
EV makers are grappling with slowing demand as higher borrowing costs push buyers toward cheaper gasoline-powered hybrid vehicles and legacy automakers focus on rolling out electric vehicles.
Rivian said it would report its fourth-quarter results on Feb. 20 after markets close.