Here’s Why Rivian Shares Plunged Today

Shares of Rivian Automotive (NASDAQ: RIVN) plummeted 18%% on Tuesday, giving back much of a recent rally after the electric vehicle maker announced a surprise stock offering late Monday.

Rivian said after Monday’s close that it was launching an underwritten public offering of 75 million Class A shares, with underwriters granted a 30-day option to purchase an additional 11.25 million shares.

Based on Monday’s closing price of $20.14, the sale could raise roughly $1.5 billion. The company said proceeds would fund general corporate purposes, including equity contributions required under its amended loan agreement with the U.S. Department of Energy tied to its Georgia manufacturing plant.

WELCOME BONUS - Free Share Bundle When You Invest £50! Get up to £500 cashback for investing with IG.

Invest in 15,000+ shares and ETFs. Open an account now, invest at least £50, and you’ll get a free share bundle worth between £40 and £200. T&Cs apply.

5.0

Open Account Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

The timing rattled investors. Rivian shares had surged 19% over the prior week and jumped another 8.1% on Monday alone, closing near multi-month highs — momentum that management appeared to seize on to raise fresh capital. Shares fell nearly 8% in after-hours trading Monday and extended losses Tuesday.

The dilution overshadowed otherwise encouraging news. Rivian also pre-announced second-quarter revenue of $1.55 billion to $1.65 billion, topping the $1.44 billion analysts expected, and said cash and short-term investments grew to $5.3 billion from $4.83 billion at the end of the first quarter.

The offering news also spooked rival Lucid Group, whose shares fell as much as 10% as investors began scrutinizing its own capital position.

Adding to the pressure, broader markets were weak Tuesday as a semiconductor selloff — sparked by underwhelming Samsung earnings — dragged down the Nasdaq, while rising oil prices tied to Middle East shipping tensions pushed Treasury yields higher, souring risk appetite across growth stocks.