Rivian CEO says chip shortage will reduce this year

The earnings report comes after the electric car maker halved its 2022 production forecast earlier due to parts and materials constraints.

Electric vehicle startup Rivian Automotive Inc. RIVN -9.61% maintains its 2022 production guidance, with executives saying supply chain issues that have hampered factory production in recent months will ease later this year and are expected to reduce.

Rivian, which reports quarterly results after the market closed on Wednesday, said first-quarter revenue of $95 million was below Wall Street expectations.

The company's net loss nearly quadrupled to $1.6 billion in January-March, from $414 million in the previous quarter.

According to Rivian, higher logistics costs also affected results due to faster shipping costs as a solution to supply chain disruptions. Since late March, the company has suspended production lines for longer than expected, losing about a quarter of its planned output due to supply shortages, Rivian said.

CEO RJ Scaringe said he is working with suppliers to provide more parts and believes the company is overcoming previous hurdles faced in semiconductor procurement. He said Rivian plans to add a second layer factory in the second half of this year.

"We've really seen the worst or something like a valley of supply shortages," Scaringge said, referring to the shortage of computer chips.

Rivian executives said the company's losses had to be cut as it began work at total capacity at the Normal, Illinois, facility capable of producing 150,000 vehicles a year. The company produced 2,553 cars in three months and delivered 1,227 units to customers.

The earnings report follows a week-long decline in Rivian share price, which hit a week low, trading at nearly a quarter of its initial asking price of $78 per share.

Following the results, Rivian shares were up 7% in after-hours trading. Earlier, the stock fell 9.6% during the regular session to close at $20.60 a share.