Rivian Is Pumping the Brakes on Spending and Production Growth. That's a Green Flag for Investors.
Investors reacted with disappointment when Rivian Automotive (NASDAQ: RIVN) provided its fourth-quarter 2022 financial and operational update yesterday evening. It wasn't because of its growing losses -- that was expected from the electric vehicle (EV) start-up. Rather, it was what the company said about 2023 that spooked investors and sent the stock down.
But savvy readers of its shareholder letter may find that what some took as negative could turn into an opportunity for long-term investors. The company is throttling its investment spending and provided an outlook for 2023 vehicle production below Wall Street expectations. That could be the right long-term move.
A look back through the last year helps show why Rivian might now have a winning strategy. The company's first full year of production was marred by supply chain disruptions, manufacturing struggles, and rising raw material costs.
Source Fool.com
