Rivian is saved by the program in 2025

Rivian is, by all accounts, a maker and seller of electric vehicles. But in 2025, it was the company’s software and services that helped its annual revenue grow 8%.

Rivian on Thursday reported $5.38 billion in total revenue in 2025, up from $4.97 billion from the previous year. That rosy picture looks a bit dull when looking only at auto revenue, which fell 15% to $3.8 billion in 2025. That decline was driven by a $134 million decline in regulatory credit sales and lower vehicle deliveries, which were partially offset by higher average selling prices, according to Rivian.

Meanwhile, software and services revenue more than tripled to $1.55 billion for the year. The joint venture with the Volkswagen Group was behind most of this growth, according to Rivian. The “Services” component of this clause, which Rivian does not detail, includes a variety of items, including vehicle repairs, vehicle trade-ins, and maintenance services. The rest, and the bulk of revenue, comes from software, specifically due to the joint venture with the Volkswagen Group.

VW and Rivian formed a technology joint venture in 2024 worth up to $5.8 billion. The joint venture is based on outstanding achievements, and in 2025 Rivian has reached the target, which means paying $1 billion in the form of a share sale. Under the terms of the joint venture, Rivian will supply the VW Group with its existing electrical architecture and software technology suite.

Rivian received an initial $1 billion convertible note in 2024 and another $1 billion payment in July 2025.

Rivian is expected to continue receiving payments from Volkswagen Group through 2027. Rivian is expected to receive an additional $2 billion in capital as part of the joint venture in 2026, Chief Financial Officer Claire McDonough said Thursday on the company’s earnings call. About $1 billion of this amount is subject to the successful completion of winter testing currently underway. The remaining $1 billion is non-refundable debt, and is expected to be received in October.

While the money provides a huge buffer, Rivian’s financial success in 2026 will largely hinge on the rollout of its next electric vehicle, the R2.

Rivian confirmed in its earnings report Thursday that the R2 SUV, designed to be cheaper to build and less expensive for customers, will hit the market by June 2026. This “cheaper to build” provision is particularly critical for Rivian, which has historically lost money on every vehicle it builds.

Rivian has spent years trying to lower its cost of goods sold. It has made progress with the introduction of the second generation of its flagship R1T truck and R1S SUV. For example, “In the fourth quarter, I was able to deliver $92,000 of gears per unit, which was an improvement of about $4,000 per unit compared to the third quarter,” McDonough said. Rivian gears per unit were $99,000 in Q4 2024.

The company saw its total cost of automotive revenue decline year-over-year from $1.4 billion in the fourth quarter of 2024 to $898 million in the same quarter of 2025. Notably, the company’s cost of revenue from software rose steadily throughout 2025.

The R2 SUV, which will initially be launched as a dual-motor all-wheel drive model, is an opportunity to further reduce costs. The company is expected to release more information about the R2, including final specifications, on March 12.

Rivian’s 2026 guidance is based on demand for R2 and its ability to ramp up production. The company said Thursday that it expects to deliver between 62,000 and 67,000 vehicles in 2026, which could provide a 59% increase over last year. Rivian will deliver 42,247 vehicles in 2025, including its R1 consumer vehicle and electric delivery van (EDV).

RJ Scaringe, CEO of Rivian, noted that the company expects some growth in EDV sales in 2026. Rivian plans to produce an all-wheel drive version and a larger battery pack variant of the EDV, of which Amazon is a primary customer.

“Both are intended to help unlock specific use cases within the Amazon network,” Scaring said. “We are working closely with Amazon in defining the requirements for these and are excited to launch those.”

The company isn’t reporting profitability — on an adjusted basis — yet. But it offers a huge improvement on this front. Rivian reported a net loss of $3.6 billion in 2025; It expects an adjusted net loss of between $1.8 billion and $2.1 billion for 2026. Rivian also expects capital expenditures to be between $1.95 billion and $2.05 billion this year.