Rivian surpassed Wall Street’s expectations for its third-quarter earnings as it increased production of the R2, its new entry-level SUV. For the period ending September 30, the company reported an adjusted loss per share of 48 cents, better than the expected loss of 62 cents, and revenue of $2.16 billion, exceeding the anticipated $1.99 billion. The stock initially dipped to a 52-week low before gaining about 7% in afterhours trading.

The electric vehicle manufacturer updated its 2026 guidance to reflect anticipated improvements in key metrics, including vehicle deliveries, pre-tax adjusted earnings, and capital expenditures. Rivian now projects a pre-tax adjusted loss between $1.75 billion and $1.85 billion, an improvement of $100 million at the midpoint. Vehicle deliveries are expected to reach between 67,000 and 70,000 units, up from the previous estimate of 65,000, while capital expenditures are forecasted at $1.4 billion to $1.5 billion, down $300 million at the midpoint.

The R2 model, which started customer deliveries in June, has quickly become Rivian’s best-selling vehicle and contributed significantly to the quarter-over-quarter growth. The company delivered a record 19,248 units during Q3. Despite remaining unprofitable on the whole, Rivian narrowed its losses to $913 million compared to $1.17 billion in the same period last year. Gross profit increased to $176 million, aided by a strong performance from its software and services segment, which brought in $605 million in revenue with a 42% gross margin.

CEO RJ Scaringe emphasized the importance of scaling R2 production to achieve profitability, aiming for a positive gross margin on the R2 by year-end. He indicated that scaling beyond the current production plan of 160,000 units will be crucial for overall business profitability. Rivian also reported a cash balance of $5.5 billion as of the end of Q3, slightly higher than the $5.3 billion at the close of Q2.