Shares of Amazon.com Inc. are on the rise, approaching a 10-month high, as the value of the e-commerce giant’s stake in Rivian Automotive Inc. continues to grow. In the past eight sessions alone, this stake has swelled by approximately $1.9 billion.
Amazon’s latest disclosures reveal that it holds 158.36 million shares of Rivian, making it the electric-vehicle manufacturer’s largest shareholder with a 17% stake.
While this investment hasn’t been particularly profitable for Amazon so far, the company did record an $11.8 billion gain on Rivian’s stock in 2021 when the EV maker went public. However, in 2022, Amazon faced a loss of $12.7 billion, followed by another loss of $467 million in the first quarter of 2023.
Despite these setbacks, Rivian’s stock has been soaring, experiencing a 17% increase and reaching a seven-month high during afternoon trading on Friday. This surge has contributed to an $1.88 billion increase in the value of Amazon’s stake during this record-breaking eight-session winning streak.
As a result of these positive developments, Amazon’s stock also jumped by 1.8% on Friday, putting it on track for its highest close since September 12, 2022.
Amazon’s Investment in Rivian Proves Beneficial
In its first-quarter filing in late April, Amazon explained the reasons behind its investment in Rivian. Amazon stated that they have the means to exert significant influence over Rivian through their equity investment, commercial arrangement for purchasing electric vehicles, and an employee serving on Rivian’s board of directors.
Electric Delivery Vans Arrival in Europe Boosts Rivian’s Stock
Amazon’s recent announcement of the arrival of their custom-made electric delivery vans in Europe has greatly contributed to the recent surge in Rivian’s stock. This development has proven Amazon’s strategic investment in Rivian to be a fruitful one.
Huge Fleet Expansion Plans
Currently, Amazon already has more than 3,000 Rivian-made vans in operation within the United States. By 2030, their goal is to have a staggering 100,000 of these electric delivery vehicles operating globally. Such ambitious plans further emphasize the enormous trust and confidence Amazon has in Rivian’s abilities.
Impressive Performance and Ford’s Stake
Rivian’s stock has experienced a remarkable 63.4% surge since the end of the first quarter. In comparison, Amazon shares have risen by 26.5%, and the S&P 500 has seen an increase of 7.9%.
Additionally, it is worth noting that Ford Motor Co.’s stock showed a 1.2% climb on Friday. Ford currently owns 10.5 million shares of Rivian, representing 1.15% of the company’s outstanding shares. In the past eight sessions alone, Ford’s stake in Rivian has appreciated by a staggering $124.35 million.
Overall, these developments showcase the immense growth potential and significant impact that Amazon’s investment in Rivian continues to have on both companies.