Rivian Automotive shares fell 18 percent Tuesday, their worst single-day decline since 2024 and the fifth worst on record, after the electric-vehicle maker announced a public offering of 75 million Class A shares to fund a federal loan commitment.
The offering, valued at roughly $1.51 billion based on Monday's $20.14 closing price, is intended to cover equity contributions required under a loan agreement with the U.S. Department of Energy, according to a regulatory filing. Rivian also granted underwriters a 30-day option to purchase up to an additional 11.25 million shares.
The selloff erased gains from a recent rally that had lifted the stock 8.1 percent on Monday alone and 19 percent over the previous week. Tuesday's drop marked a sharp reversal for a stock that had been building momentum ahead of the company's next product cycle.
Rivian separately pre-released second-quarter estimates showing revenue between $1.55 billion and $1.65 billion, above the $1.45 billion average analyst estimate compiled by LSEG. The company's cash, cash equivalents and short-term investments balance rose to an estimated $5.3 billion, up from $4.8 billion at the end of the first quarter.
The capital raise follows Rivian's decision to suspend its 2027 profitability target, a move the company attributed to an expected spike in research and development spending for autonomy and next-generation vehicle technologies. Rivian is counting on its new R2 midsize SUV, now entering production, to put it on a path toward profitability by the end of the decade.
Investors will weigh whether the strengthened liquidity position and upcoming R2 ramp can justify the dilution and the extended timeline to positive earnings.