Rivian CEO RJ Scaringe, 35, introduces his company’s R1T all-electric pickup truck and R1S all-electric SUV at the Los Angeles Auto Show in Los Angeles, California on November 27, 2018.
mike-blake | Reuters
In its earnings report on Thursday, Amazon had a $7.6 billion loss on its Rivian stake. Shares of the electric vehicle maker plunged more than 50% in the first three months of 2022, reversing course from the fourth quarter, when the company maintained its stock market debut and saw his value skyrocket.
While Amazon has big ambitions for Rivian, signing a deal to produce 100,000 delivery vehicles by 2030, current market conditions are tough. Rivian said last month that the company expects to produce just 25,000 electric trucks and SUVs this year, half the number forecast to investors last year as part of its IPO tour.
Like most manufacturers, Rivian is struggling with supply chain constraints and the drawbacks of in-house production. But Rivian was valued at $86 billion after its IPO, making the stock particularly vulnerable to a major pullback.
The fall of Rivian in 2022
The Nasdaq Composite fell 9.1% in the first quarter, its worst period since the first quarter of 2020, when the Covid-19 pandemic began. Riskier bets suffered the biggest hits as investors pivoted to assets seen as safer in a period of rising inflation and interest rates.
Rivian’s slide has continued into the second quarter, with the stock plunging another 36%. It is now more than 80% below its November high.
Amazon’s downgrade is particularly big, but it’s not the only tech company taking a beating on its capital investments.
Earlier this week, Alphabet Recorded a loss of $1.07 billion on their investments “given market volatility.” Alphabet’s investment arms have backed companies including UiPath, Freshworks, lyft Y Duolingowho have been caught up in the market swoon.
Microsoft it said this week that its first-quarter earnings were hit by $174 million in part due to “market losses in our equity portfolio.” and last week Break it said it had an unrealized loss of $92 million “on investments that became public in the second half of 2021.”