Shares of Rivian $RIVN Automotive tumbled more than 10% in premarket trading Tuesday after the company disclosed plans to sell 75 million shares of its Class A common stock to the public.
At Monday's closing price of $20.14 a share, the share sale would generate approximately $1.51 billion in proceeds. Net proceeds would go toward general corporate purposes, the company said, with a portion earmarked for equity contributions tied to an amended loan arrangement with the U.S. Department of Energy, according to Bloomberg. Goldman Sachs $GS is leading the share sale, according to Bloomberg. The offering was expected to be priced after Tuesday's market close.
As part of the deal, underwriters received a 30-day option covering up to 11.25 million additional shares, the company said. Should the full allotment of 86.25 million shares find buyers at Monday's price, gross proceeds could top $1.74 billion, Benzinga reported.
The fundraise follows a strong stretch for the stock, which had climbed 8.1% in Monday's session and notched a 19% gain over the prior week, according to CNBC. The gains were driven in part by strong second-quarter delivery results and investor interest in the company's new R2 SUV line.
Concurrent with the share sale announcement, Rivian issued a preliminary look at its second-quarter financials, putting revenue for the period at between $1.55 billion and $1.65 billion, an improvement from $1.30 billion in the year-earlier quarter. The company said the increase was driven by higher vehicle deliveries, partially offset by lower average selling prices from a higher mix of commercial vans. The company's combined cash, equivalents, and short-term investments were roughly $5.3 billion at quarter-end, up from $4.8 billion at the end of the first quarter.
Second-quarter deliveries totaled 12,194 vehicles, and the company nudged its annual delivery target upward to a range of 65,000 to 70,000 units from a prior forecast of 62,000 to 67,000.
The R2 SUV, which began reaching reservation holders last month, is central to Rivian's path toward profitability. The company dropped a previously stated goal of achieving adjusted profitability by 2027 earlier this year, with no replacement target announced. Chief Financial Officer Claire McDonough signed the SEC filing disclosing the preliminary second-quarter results.
Rivian's full second-quarter earnings report is due out July 30.