What Are Rivian Stock Bulls Not Worried About? Trefis Team Tue, November 10, 2026 at 8:16 PM EST 3 min read RIVN -2.07% ^GSPC -0.38% TSLA +1.22% F -0.49% GM -0.33% Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
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Rivian Automotive (RIVN) has a winner in the R2 entry-level SUV, which outsold its other vehicles in the third quarter of 2026. Rivian stock lost 8.0% over the past year, however, while the S&P 500 returned 13.7%. Bulls may be counting on the R2 to lower the cost of building each vehicle, and management says the model is already helping. So what could still push Rivian's costs back up?
Rivian Is Paying More For Memory And Commodities
The parts Rivian buys are getting more expensive. Management raised the issue itself on its October 29 call for the third quarter of 2026, noting that macro and geopolitical factors are adding cost and uncertainty. The team is working to manage supply chain risks alongside rising commodity and memory costs, management said. Higher costs for core components have hurt profitability, management added, and it expects them to keep doing so.
During the question session, management said commodity prices had come in much higher than it expected, with memory playing a really important part of that. Rivian is looking for other ways to offset those costs so it can still deliver its announced trims, which range from $45,000 for the base trim to about $57,000 at the top. This suggests Rivian would rather absorb the cost of more expensive parts than raise those prices.
How Much Of Rivian Do Higher Parts Costs Touch?
Higher parts costs hit Rivian's vehicle sales, which made up 71.1% of its revenue in fiscal 2025. Automotive revenue fell 14.6% that year. In the third quarter of 2026, however, it reached $1.55 billion, up 36% from a year earlier. Rivian still sold those vehicles at a gross loss of $80 million in that quarter, leaving the company with no gross profit on vehicles to absorb higher parts costs.
At the November 9 close, Rivian stock traded at 3.1 times its sales over the past twelve months, the same multiple as the S&P 500. Its price-to-earnings ratio is not meaningful, because Rivian lost $2.97 billion over those twelve months. The stock closed 37.6% below its highest close of the past year. Even so, for a company still losing money, the price appears to assume that the R2 will bring vehicle costs down.
How Worried Should Rivian Holders Be?
Rivian holders should treat dearer parts as a real risk, but so far a slow one. In the third quarter of 2026, the gross loss on vehicles was $50 million smaller than a year earlier. Management said that came mainly from higher deliveries at a better margin per unit, more regulatory credits and a tariff refund, partly offset by the cost of ramping up R2. Management put that ramp cost at about $120 million in the quarter, from running below full production, and expects some of it to fade as Rivian scales. Part of that improvement came from credits and a refund rather than from building vehicles more cheaply. Still, the reported loss narrowed while parts got dearer, so for now higher parts costs have not reversed Rivian's progress.
Management still expects the vehicle business to be making a gross profit by the end of 2026, though not for the fourth quarter as a whole, and it also expects rising component costs to keep hurting profitability. Rivian's automotive gross profit for the fourth quarter of 2026 is the number to watch when it reports, expected in February 2027.
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