Is Rivian Stock a Buy Before Feb. 12?

On Feb. 12, embattled electric vehicle maker Rivian Automotive (NASDAQ: RIVN) will announce fourth-quarter earnings. In this report, investors will be closely watching to see if the company can successfully diversify its business model to include more contributions from software and services, which could be more reliable growth drivers than traditional vehicle sales. Let's discuss what investors should expect and decide if the stock is a buy.

Production and delivery numbers were lackluster

While investors have to wait until Feb. 12 for Rivian's official earnings report, fourth-quarter delivery and production numbers are already available. The picture isn't pretty.

Deliveries fell 31% year over year to 9,745, mainly because demand was pulled forward to the third quarter (when Rivian delivered 13,201 vehicles) as customers rushed to get ahead of President Donald Trump's decision to axe a $7,500 tax credit for new electric vehicle (EV) purchases.

Similar trends occurred throughout the EV sector. And management says it had expected the volume decline. That said, there is some cause for concern.

In 2025, Rivian vehicles generally weren't even eligible for the tax credit because of failure to meet requirements for domestic battery sourcing. And with Rivian's flagship R1S having a starting suggested price of $76,990, the company's products appeal to wealthier households and individuals who may not have even qualified for the incentives.

Unfortunately, these factors were not able to shield Rivian from uncertainty related to the tax credit that is hurting the rest of the EV industry. With this in mind, it is more important than ever for the company to diversify its business model outside of just manufacturing and delivering cars.

Can software save the day?

The most exciting thing about Rivian might no longer be its cars. As far as the market is concerned, software and services are arguably the bigger story.

In late 2024, the company teamed up with Volkswagen on a joint venture to work on software and vehicle electronics. The German automaker reports that the agreement is showing strong progress with 1,500 employees and state-of-the-art systems that will be used across both companies' lineups.

This deal benefits Rivian by giving it an infusion of cash (Volkswagen will invest up to $5.8 billion in the company and the joint venture by 2027). And it provides the EV maker with economies of scale by being able to buy components in larger volumes -- bringing down costs.

The joint venture could also become a revenue opportunity. According to Rivian's chief software officer, Wassym Bensaid, other original equipment manufacturers (OEMs) are interested in potentially incorporating Rivian's architectures into their vehicle platforms.

The company seems to have established a substantial lead in vehicle electronics development, with Reuters reporting that its systems require fewer control units and wiring than alternatives, leading to a simpler manufacturing process and reduced vehicle weight.

Image source: Getty Images.

Rivian's third-quarter earnings give a glimpse of what a software- and services-led future could look like. Consolidated revenue jumped 78% year over year to $1.5 billion, helped by a 324% jump in its software and services contribution (to $416 million).

Obviously, investors shouldn't expect Rivian's fourth-quarter revenue to be quite as good as the stellar third-quarter results. This segment includes after-sale services like repairs and remarketing trade-ins. And the decline in fourth-quarter deliveries could hurt the service side of the business. That said, the Volkswagen joint venture could help make up for some of these headwinds.

Is Rivian stock a buy before Feb. 12?

Rivian's production and delivery report lets us know that the company is far from immune to the fallout resulting from President Trump's removal of EV tax credits. With this in mind, investors shouldn't expect fourth-quarter earnings to come close to the blowout seen in the third quarter. Furthermore, the weakness may continue into 2026 until new-model releases like the Rivian R2 potentially reignite consumer demand.

The stock still looks like a winner. But buying shares before an important earnings announcement is usually a coin toss. And this time is no exception. Investors who decide to pull the trigger should focus on Rivian's long-term potential instead of short-term price fluctuations.

Will Ebiefung has no position in any of the stocks mentioned. The Motley Fool recommends Volkswagen Ag. The Motley Fool has a disclosure policy.