Amazon records $3.9 billion loss on Rivian holding in second quarter

Amazon’s stake in electric powered automobile maker Rivian Automotive was once value $27 billion. That was in November, shortly soon after Rivian’s IPO, which took place just before the Nasdaq peaked.

But with investors rotating out of chance in 2022 and providing off very last year’s large-priced IPOs, Amazon has now taken paper losses on its Rivian stake totaling $11.5 billion for the first two quarters, a extend through which Rivian dropped a few-quarters of its price.

Amazon reported in its next-quarter earnings report on Thursday that it recorded a $3.9 billion loss on its Rivian holdings during the period. The report will come a working day immediately after Ford, which is also one of Rivian’s top backers, took a $2.4 billion mark-to-current market writedown.

Amazon’s financial commitment is now worth about $5 billion.

Rivian CEO RJ Scaringe and Amazon CEO Andy Jassy tour a single of the company’s electric powered supply vans.


The markdowns do not effects the Amazon’s operations or dollars situation, and just reflect the large gyrations in the marketplace due to the fact late very last 12 months. The financial investment could turn out to be problematic if Rivian’s nascent business hits a snag or operates reduced on cash, hampering the firm’s means to manufacture shipping and delivery motor vehicles at the pace it promised Amazon.

Amazon explained past week it truly is commencing to roll out some of the electric powered delivery vans that it created with Rivian. Amazon stated it expects to have thousands of Rivian vans in a lot more than 100 cities by the close of this 12 months, the first step towards its purpose of possessing 100,000 electric powered delivery motor vehicles on the road in the U.S. by 2030.

Rivian, which reviews quarterly outcomes on Aug. 11, has struggled to satisfy output goals of its R1T and R1S electric powered vehicles, which are centered a lot more on the client current market. The company cut its 2022 production forecast in half in March, to just 25,000 automobiles, like Amazon vans, as it discounts with supply chain constraints and problems with its assembly line.

However, optimism has rebounded some in the 3rd quarter. The inventory is up about 29% due to the fact the end of June. It got an additional strengthen on Wednesday immediately after Senate The vast majority Leader Chuck Schumer, D-N.Y., and Sen. Joe Manchin, D-W.V., said they’ve reached a deal on what would be the most formidable local weather investing package in U.S. historical past.

The Inflation Reduction Act of 2022 incorporates $369 billion for clean power provisions. Rivian rose about 3%, signing up for a broader rally in solar and substitute electrical power shares.

Check out: Initial glimpse at Amazon and Rivian’s electric powered shipping vans