What happened

Investors in Arrival (ARVL) were treated to a pleasant surprise Tuesday morning when shares of the electric vehicle (EV) start-up skyrocketed as high as 14.1% at one point in early trading.

Those gains quickly faded, though, as the stock markets slipped into the negative territory. Arrival stock was barely in the green by 11:30 a.m. ET, but it pays to know what sent the penny stock so high.

So what

Arrival released its first-quarter earnings report this morning. For a change, the embattled EV maker had some good news to share with investors.

A worried person studying a falling graph on a laptop.

Image source: Getty Images.

Arrival reported a loss of only $10.4 million for the first quarter versus a loss of nearly $1.1 billion in the year-ago period. That massive turnaround alone spiked interest in the stock, but it appears the market soon realized it wasn't a turnaround after all.

Arrival's huge losses last year were the result of one-time charges related to its reverse merger with a special purpose acquisition company (SPAC) last year through which Arrival went public. Adjusting for those charges, Arrival's adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) loss more than doubled year over year to $67 million in the first quarter.

For the full year, Arrival expects to see an adjusted EBITDA loss of $185 million to $225 million. 

Now what

For investors in Arrival right now, the progress the company is making on its production and delivery timelines is far more important than any numbers. That's because Arrival has yet to manufacture and sell vehicles commercially, and unless the company hits its first production and delivery milestones and generates its first revenue, investing in Arrival stock is nothing but speculation.

From that standpoint, Arrival tried to convince investors about its progress by announcing today that it expects to start production of its vans as well as start public road trials for its buses in the third quarter. It expects to produce 400 to 600 vans this year. That's still well short of the number of vehicles companies such as UPS tentatively have on order with Arrival.

Arrival stock could get a lift if the company can hit those milestones, but it's still a big if, and Arrival will need do a lot more a lot faster to win back investor confidence.