Rivian’s Stock Dips Over 22% as Company Announces $1.5 Billion Convertible Notes Offering
On a surprising note, Rivian Automotive witnessed a sharp decline in its stock value after unveiling plans to offer $1.5 billion in convertible notes. Additionally, the company released a preliminary estimate for its third-quarter revenue, which closely aligned with Wall Street expectations.
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Rivian
In a regulatory filing made on a late Wednesday, Rivian projected its third-quarter revenue to fall within the range of $1.29 billion to $1.33 billion. This forecast closely matched Wall Street’s consensus estimate of $1.3 billion, as reported by LSEG (formerly known as Refinitiv).
As of September 30, Rivian estimated its cash and equivalents to be $9.1 billion, reflecting a decrease from the $10.2 billion reported at the end of the second quarter.
Rivian had previously implemented cost-saving measures to strengthen its financial position, including a 6% reduction in staff in February and a $1.3 billion sale of convertible notes in March. Furthermore, the company rescheduled the launch of its forthcoming smaller R2 vehicle platform from 2025 to 2026. However, the announcement of the latest convertible notes offering came as a surprise to investors.
Rivian’s plan involves offering $1.5 billion worth of senior, unsecured “green” convertible notes that will mature in 2030. Buyers will also have the option to acquire an additional $225 million worth of notes, as indicated by the company.
Despite the stock setback, Rivian reported better-than-expected third-quarter deliveries earlier in the week. The electric vehicle manufacturer is set to disclose its third-quarter earnings after the U.S. markets close on November 7.
