Rivian (RIVN) reported better-than-expected first quarter results on Tuesday and posted a second straight quarter of gross profits, but President Trump’s tariffs on auto parts will push the pure-play EV maker’s capital expenditures higher by $1.8 billion to $1.9 billion this year. Rivian stock was down slightly in after-hours trade following the announcement.

“This quarter we hit our second consecutive gross profit and our highest gross profit to date at $206 million,” CEO RJ Scaringe said in a statement. “We have continued to make significant progress on R2, including vehicle validation builds underway and our Normal, Illinois manufacturing facility expansion on track.”

Rivian further said hitting the gross profit milestone unlocked an additional $1 billion investment from Volkswagen Group as part of its investment in Rivian following the formation of their joint venture. The funding is expected on June 30.

But the company said “evolving trade regulation, policies, tariffs,” as well as the impact on consumer sentiment and demand have led Rivian to cut its 2025 delivery outlook to 40,000 to 46,000 units (from 46,000 to 51,000) and raise its capital expenditures guidance to $1.8 billion to $1.9 billion.

The company did maintain its 2025 full-year adjusted EBITDA loss projection in the range of $1.7 billion to $1.9 billion.

“While Rivian has 100 percent US vehicle manufacturing and a majority of its bill of materials (excluding cells) coming from the US or [United States-Mexico-Canada Agreement] USMCA-qualified, Rivian is not immune to the impacts of the global trade and economic environment,” the company said.

Rivian reported revenue of $1.240 billion vs. $981.21 million estimated by Bloomberg, slightly higher than the $1.204 billion reported a year ago. The company posted an EPS loss of $0.48 vs. $0.92 estimated, with an adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) loss of $329.0 million vs. $546.4 million expected.

The company said in early April that it produced 14,611 vehicles at its manufacturing facility in Normal, Ill., and delivered 8,640 vehicles, in line with its expectations.

Continued improvements in cost-cutting will now come face to face with Trump’s auto tariffs, which will raise the company’s bill of materials (BOM) figures for each EV sold. Internal components, battery cells, and even steel and aluminum tariffs will likely hit Rivian, though as a US producer, it will have the ability to get “offsets” for some tariffs on foreign-made parts.