Lucid Motors Group (LCID:NSD) Misses on Earnings, Stock Falls

LCID Ratings by Stock Target Advisor

Lucid Earnings

Lucid Motors, the California-based electric vehicle maker, reported a disappointing Q1 2023 revenue and earnings miss, causing the company’s shares to fall in extended trading. Despite a year-over-year increase in revenue from $57.7 million to $149.4 million, Lucid missed Wall Street’s revenue estimate of $197.8 million, as well as its own Q4 2022 revenue of $257 million. Furthermore, the company reported an adjusted EPS loss of $0.43, wider than the $0.40 loss per share expected by analysts.

Lucid’s management team sought to reassure investors, stating that the company ended Q1 with approximately $4.1 billion in total liquidity, which is expected to fund the company through at least Q2 2024. The company also indicated that it is on track to produce over 10,000 vehicles in 2023 and has ongoing initiatives that will enable it to pivot to higher volumes as market conditions allow.

Lucid produced 2,314 vehicles in Q1, delivering only 1,406 of those cars to customers. Although the company is on track to produce over 10,000 vehicles in 2023, this falls on the low end of Lucid’s 10,000 to 14,000 production forecast. In addition, the company announced its own $7,500 “credit” for certain Air sedans in Q1 to boost sales as its sole product doesn’t qualify for the $7,500 federal EV tax credit. Management is expected to address whether this incentive lifted pre-orders during the quarter and its impact on profitability.

The future of Lucid’s ownership structure and its status as a public entity are also a significant concern for investors. Lucid’s stock surged in January on speculation that Saudi Arabia’s Public Investment Fund (PIF) would buy out the remainder of the company it doesn’t already own and take it private. PIF’s stake in Lucid currently stands at approximately 65%, and the partnership goes beyond a financial agreement. Last year, Lucid announced that it would build a factory in Saudi Arabia, with a planned annual capacity of 155,000 EVs a year.

Looking ahead, the company’s upcoming earnings call will likely address these concerns and provide investors with more information about Lucid’s profitability and production outlook. The market conditions for electric vehicles are rapidly evolving, with new competitors emerging and changing consumer preferences. Still, Lucid’s management team is confident in the company’s ability to continue growing and expanding its production capabilities, as evidenced by its ongoing initiatives and plans to unveil the Gravity SUV later this year. Despite the disappointing Q1 results, Lucid remains a key player in the electric vehicle market and has the potential to achieve significant success in the coming years.

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