Lucid Secures More Funding, Beats Analysts Q2 Earnings Estimates

by Michael Strong | August 6, 2024

EV maker Lucid Motors offered up good news during its second quarter earnings call as it secured as much as $1.5 billion in new cash just in time to begin production of its second vehicle, the Gravity SUV. The company also managed to beat analysts’ estimates for the quarter.

Lucid produced more than 2,300 Air flagship sedans during the second quarter.

The California-based company reported revenue of $200.6 million, which is an increase over the $150.9 from the year-ago result. Revenue for the second quarter was $200.6 million, compared with analysts’ estimate of $192.1 million, according to LSEG data.

“Our Q2 financial performance reflects the positive momentum of increased sales of Lucid Air and the results of our cost reduction efforts, which contribute to the journey toward improving gross margin,” said Gagan Dhingra, Interim Chief Financial Officer and Principal Accounting Officer at Lucid.

Revenue increase

The company also reported year-to-date revenue of $373.3 million, a jump from the $300.3 million through the end of the first six months of 2023.

However, the company reported a net loss of $790.3 million for Q2, slightly more than last year’s $764.2 million for the same period. Through six months, the company’s lost $1.48 billion, an improvement over last year when it lost $1.54 billion during the first half of the year.

Lucid secured as much as $1.5 billion in additional funding, insuring the launch of the Gravity SUV later this year.

Losses like this aren’t uncommon for an automotive startup. Competitor Rivian is in the same boat and Tesla, the EV leader, lost money for years before moving from the red to the black a few years ago.

The company also reported second-quarter revenue above analysts’ estimates as price cuts helped drive sales of its luxury electric sedans during the second quarter. In February, the company cut up to 10% off the price of its flagship Air sedans hoping to jump start sales.

Cash going forward

The company announced it secured an influx of as much as $1.5 billion from its majority stockholder, Ayar Third Investment fund. An affiliate of the Saudi-controlled Public Investment Fund, it plans to purchase $750 million of convertible preferred stock via private placement and provide for a $750 million unsecured delayed draw term loan facility at later date.

The new Lucid Air Pure is now the first EV to achieve 5 miles of range per kilowatt hour of energy.

Lucid officials said the company has not borrowed under the Delayed Draw Term Loan Facility. The automakers intends to use the net proceeds from the private placement and any proceeds from the term loan for general corporate purposes, which may include, among other things, capital expenditures and working capital. The PIF holds about 60% of Lucid’s stock.

However, the real use of the money aims to ensure a successful launch of the company’s second vehicle, the all-electric Gravity SUV. Lucid is currently preparing its vertically integrated factory in Arizona to begin production of the Lucid Gravity SUV.

“We ended the second quarter with $4.28 billion in total liquidity and remain committed to maintaining a healthy balance sheet to execute on our strategic vision,” Dhingra said. “The additional $1.5 billion commitment by an affiliate of the PIF announced today is expected to provide sufficient liquidity into at least the fourth quarter of 2025.”

On a roll

Lucid has developed a number of new technologies expected to yield even more efficiency.

Lucid’s been enjoy a run of good news lately. Not only did it beat analysts’ estimates for the quarter, it delivered 2,394 during the quarter, It predicted deliveries would hit the 9,000-vehicle mark for the full year.

Last month, it set a new benchmark for efficiency. The new Lucid Air Pure is now the first EV to achieve 5 miles of range per kilowatt hour of energy, resulting in its 84 kWh battery traveling an EPA-rated 420 miles on a full charge.

That translates to 146 MPGe. MPGe is the EPA’s equivalent of miles per gallon used by gas-powered vehicles. One gallon of gas equals 33.7 kWh of energy. The Pure is Lucid’s entry-level model.

The new number puts it above other EVs like the newly released 2024 Tesla Model 3 long range rear-wheel drive at 4.4 mi/kWh, or 2024 Hyundai Ioniq 6 Long range RWD at 4.2 miles per kWh or 140 MPGe, the 2024 Lexus RZ 300e at 3.7 mi/kWh or 125 MPGe.